CFA Level I Exam · Guidance for Standard I: Professionalism

Standard I(C) Misrepresentation in CFA Level I Ethics

Updated 7 October 2026 · Fact-checked

Standard I(C) Misrepresentation says members and candidates must not knowingly make misrepresentations relating to investment analysis, recommendations, actions or other professional activities. To solve a question, find the false or misleading statement, omission or copied work, check whether it relates to professional activities, and pick the answer that corrects or avoids it.

Understand Standard I(C) Misrepresentation

Standard I(C) sits inside Standard I: Professionalism. The official wording is: "Members and Candidates must not knowingly make any misrepresentations relating to investment analysis, recommendations, actions, or other professional activities."

A misrepresentation is any untrue statement or omission of a fact, or any statement that is otherwise false or misleading. It also covers outright lies and half-truths. Leaving out a fact that makes the rest of a statement misleading counts. The word knowingly matters: the Standard prohibits knowing misrepresentations. Still, you should verify facts before you state them, because careless or unchecked statements may breach Standard V(A) (Diligence and Reasonable Basis) or V(B) (Communication with Clients) rather than I(C) itself.

The Standard covers what you say about your own work, your qualifications and your services. Examples: overstating your experience, claiming a past record you did not earn, promising returns you cannot guarantee, or describing a firm's services inaccurately. It also covers how you present performance and how you describe your credentials.

Plagiarism is a main application. Plagiarism means using someone else's work, such as reports, research, charts, quotes or ideas, and presenting it as your own. Copying without attribution is a misrepresentation of who did the work. Protection comes from giving credit. You must name the source when you use another person's words, ideas, data or models.

Third-party research is allowed. The risk is using it without checking it or without credit. You may rely on it only if you know the provider is reputable and you have a reasonable basis for the work. You still need to attribute it. Standard V(A) covers the diligence side of this, while I(C) covers the honesty of the presentation.

One point is clear: work that colleagues produce for your firm is generally the firm's property. Using it within the firm's products does not require you to credit the individual colleagues. But you must not claim that you personally did work that others did. Work from outside the firm always needs credit. If you use another firm's research or other published work, you must attribute it, and you must not copy it without credit.

Key formulas to remember

Standard I(C) wording: Members and Candidates must not knowingly make any misrepresentations relating to investment analysis, recommendations, actions, or other professional activities.; Quote the idea of "knowingly" and "professional activities" when you test an answer option.
What counts as misrepresentation: Misrepresentation = false statement + misleading statement + omission of a fact that makes a statement misleading; Silence can violate the Standard when the omitted fact is needed to avoid misleading the audience.
Plagiarism test: Plagiarism = using another person's work or ideas + presenting them as your own (no credit); Fix: attribute the source. This applies to words, data, charts, models and ideas.
Third-party research rule: May use third-party research if: source is reputable + you have a reasonable basis + you give credit; You cannot rely blindly. Unchecked reliance may breach Standard V(A) as well.

How to solve Standard I(C) Misrepresentation questions

Use this order for any Standard I(C) question. It keeps you away from the traps in the three options.

1Read the stem and find what was said, written or presented, and to whom.
2Ask: is it false, misleading, or missing a fact that changes the meaning?
3Ask: does it relate to analysis, recommendations, actions, qualifications, services or other professional activities?
4Check whose work it is. If someone else's work is presented without credit, think plagiarism.
5For third-party research, check three things: reputable source, reasonable basis, attribution.
6Decide whether a violation occurred. Standard I(C) prohibits knowing misrepresentations. Careless or unchecked statements may breach Standard V(A) (Diligence and Reasonable Basis) or V(B) (Communication with Clients) rather than I(C) itself. An honest mistake that is promptly corrected is different.
7Pick the option that matches the Standard: add attribution, disclose the omitted fact, correct the statement, or stop the misleading practice.
8Eliminate options that excuse the act because of firm practice, client consent or difficulty of attribution.

Quickest way: Three-question filter

When to use it: Use it when time is short and the stem describes a statement, a report or a marketing claim.

Is anything untrue, misleading or left out?
Is someone else's work used without credit?
Is there a fix that adds truth or credit?
Choose the option that does the fix, or that identifies the violation. Drop options that allow the misleading act to continue.

Common mistakes in Standard I(C) Misrepresentation

Thinking plagiarism only applies to copied text.
Students link plagiarism to school essays.
Fix: Remember it covers data, charts, models, ideas and research reports presented as your own.
Believing any use of third-party research is a violation.
Students confuse attribution with prohibition.
Fix: Use is allowed with a reasonable basis, a reputable source and credit.
Ignoring omissions.
Students look only for false statements.
Fix: Ask whether a missing fact makes the message misleading. If so, I(C) is engaged.
Mixing up I(C) with V(A).
Both mention research.
Fix: I(C) is about honest presentation and credit. V(A) is about diligence and a reasonable basis for the recommendation.
Assuming a guarantee of returns is fine if the client agrees.
Students think consent cures the issue.
Fix: Client consent does not make a false or misleading claim acceptable. Avoid guarantees you cannot back.
Overstating credentials in a bio.
Candidates think a minor stretch is harmless.
Fix: Describe qualifications and experience accurately, including your candidacy status.

Worked examples

Example 1

An analyst at a research firm finds a detailed industry chart in a report by an outside provider. She inserts it into her own client report without a source note. Her work is otherwise accurate. Which is most likely correct under Standard I(C)? A) No violation, because the chart is accurate. B) A violation, because she presented another party's work without credit. C) No violation, because the chart is publicly available.

Show the solution

The chart was made by an outside provider, so it is someone else's work.
She presented it without a source, so readers would think it is hers.
That is plagiarism, which is a form of misrepresentation.
Accuracy does not cure missing credit, so A fails. Public availability does not remove the duty to attribute the source, so C fails.

Answer: B

Example 2

A portfolio manager's marketing brochure states that his fund "has never lost money for clients" but omits that this refers only to the best-performing three-year period. Under Standard I(C), the manager has most likely: A) not violated, since the statement is literally true for that period. B) violated, because the omission makes the statement misleading. C) not violated, because past performance is public.

Show the solution

The claim is true only for a selected period.
The brochure leaves out that limit, so a reader would think it covers all of the fund's history.
An omission that makes a statement misleading is a misrepresentation.
A fails because literal truth is not enough. C fails because public data does not remove the duty to present it fairly.

Answer: B

Exam tips

Look for the words "without attribution", "omits" or "guarantee". They usually signal I(C).
When an option says to add the source or disclose the missing fact, it is often the best fix.
Separate I(C) from V(A): honest credit versus reasonable basis. Some questions test both.
Do not accept excuses such as "everyone does it" or "the client agreed".
With no penalty for wrong answers, always answer. Remove the option that allows the misleading act, then choose between the other two.

Practice questions from Guidance for Standard I: Professionalism

Standard I(C) Misrepresentation in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Standard I(C) Misrepresentation: frequently asked questions

What does Standard I(C) Misrepresentation prohibit?

It prohibits knowingly making misrepresentations about investment analysis, recommendations, actions or other professional activities. This includes false statements, misleading statements and omissions that mislead. It also covers plagiarism.

What is the difference between misrepresentation and plagiarism?

Misrepresentation is the wider idea of a false or misleading statement or omission. Plagiarism is one kind of it: presenting another person's work or ideas as your own. All plagiarism is misrepresentation, but not all misrepresentation is plagiarism.

How can I use third-party research without violating the Standards?

Use work from a reputable source, make sure you have a reasonable basis for relying on it, and give credit to the source. Do not present the work as your own. Doing the checks also supports Standard V(A).

Does a misrepresentation have to be intentional?

Standard I(C) says "knowingly", so it targets knowing misrepresentations. You should still check facts before you communicate them. Careless or unchecked statements may breach Standard V(A) (Diligence and Reasonable Basis) or V(B) (Communication with Clients) instead.