Skip to content

Level III Core · Guidance for Standard I: Professionalism

CFA Standard I(C) Misrepresentation Explained

Updated 8 October 2026 · Fact-checked

Standard I(C) says you must not knowingly make misrepresentations about investment analysis, recommendations, actions or other professional activities. This covers false statements, misleading omissions, plagiarism and inflated claims about services or performance. To solve a question, find the statement, test whether it is false or misleading, and check what the member knew or failed to check.

Understand Standard I(C) Misrepresentation

Standard I(C) protects clients, employers and the market from being misled. A misrepresentation is any untrue statement or any omission of a fact that makes a statement misleading. It applies to what you say or write about your analysis, recommendations, actions, services, firm and qualifications.

The Standard prohibits knowingly making misrepresentations. The Handbook also treats recklessly or carelessly misleading statements and omissions as a violation, for example failing to check a source's accuracy or leaving out a relevant fact. A good-faith error that is promptly corrected once found is not a violation.

Plagiarism is a core part of the Standard. You must not copy or use the ideas, words, charts, data or work of another person and present them as your own without giving credit. This includes material from research reports, websites, colleagues, and models. The work of others, including data, charts and ideas, must be credited, including when you rephrase it.

The only exception is work product of your employer. Because the employer owns it, the firm's employees may use it under the firm's policy, without crediting individual contributors. You must not claim individual credit for it, and you must not take it to a new employer without permission. Using third-party research is allowed when you check that it is sound and credit the source.

Performance and services claims also fall under I(C). You must not promise or guarantee returns that cannot be assured, overstate your qualifications, or imply that results are better than they are. Using the CFA designation or referring to candidacy wrongly is a misrepresentation too, and sits closely with Standard VII(B). Presenting performance fairly is covered in detail in Standard III(D).

Key rules to remember

Core rule
Members must not knowingly make misrepresentations relating to investment analysis, recommendations, actions, or other professional activities.
Knowing conduct violates the Standard. The Handbook also treats reckless or careless misleading statements and omissions as violations. A good-faith error promptly corrected is not a violation.
Plagiarism test
Using another's work (words, ideas, data, charts, models) + presenting it as your own = violation
Fix by giving credit to the source. Rephrasing does not remove the duty to credit.
Omission test
Statement + omitted fact that changes its meaning = misleading
Leaving out a relevant fact can be as serious as stating something false.
Work product rule
Work product owned by the employer may be used by the firm's employees under the firm's policy, without crediting individual contributors
Do not claim individual credit for it, and do not take it to a new employer without permission.
Guarantee rule
No guarantee or promise of investment results that cannot be assured
Claims about past performance must be fair, accurate and complete.

How to solve Standard I(C) Misrepresentation questions

Use this order for any I(C) vignette or short question. Keep each step to a line in your answer.

  1. 1Identify exactly what was said, written or presented, and to whom.
  2. 2Check whether the statement is false, or true but misleading because of an omission.
  3. 3Ask whose work it is. If it is someone else's, check whether credit was given. The only exception is the employer's own work product, used under firm policy and without claiming individual credit.
  4. 4Ask what the member knew, or should have checked, before making the claim.
  5. 5Check for guarantees, inflated qualifications or unfair performance claims.
  6. 6State clearly: violation or no violation, and name Standard I(C) (plus a related Standard if relevant).
  7. 7Give the corrective action: correct the statement, add the source, add the omitted fact or remove the claim.

Quickest way: Three-question screen

When to use it: Use it on multiple-choice items where options differ by small wording changes.

  1. Is the statement false or incomplete in a way that misleads? If no, it is probably fine.
  2. Is any part of it someone else's work without credit? If yes, it is plagiarism.
  3. Did the member know, or recklessly or carelessly fail to check? If yes, it is a violation. A good-faith error promptly corrected is not.
  4. Choose the option that corrects the statement or adds credit, not the one that only hides the issue.

Common mistakes in Standard I(C) Misrepresentation

  • Thinking rephrased work needs no credit.

    Students believe plagiarism means word-for-word copying only.

    Fix: Remember that ideas, data and analysis also need credit, even when put in your own words.

  • Treating all omissions as violations.

    Students over-apply the rule once they see a missing detail.

    Fix: Ask whether the omitted fact would change how a reasonable person reads the statement.

  • Saying any error, even a good-faith one that is quickly corrected, violates I(C).

    Students ignore the word knowingly and the difference between an honest error and careless conduct.

    Fix: Ask what the member knew and whether they checked. Knowing falsehoods and reckless or careless misstatements violate the Standard. A good-faith error that is promptly corrected does not.

  • Assuming a firm's own report can be reused with a personal name on it.

    Students confuse permission to use work product with authorship.

    Fix: The employer owns its work product, so employees may use it under firm policy. Do not claim individual credit for it, and do not take it to a new employer without permission.

  • Missing the link to other Standards.

    Students stop at I(C) and ignore overlap.

    Fix: If the issue is performance presentation, think of III(D); designation use, think of VII(B); research basis, think of V(A).

Worked examples

Example 1

An analyst at an asset manager copies two pages of an industry outlook from a third-party research firm into her client report. She changes some wording and does not name the source. Does she violate the Standards? What should she do?

Show the solution
  1. Identify the act: she used another firm's analysis in her own report.
  2. Check credit: the source is not named, so the work appears to be hers.
  3. Check the rewording: changing words does not remove the need to credit ideas or analysis.
  4. Apply the Standard: this is plagiarism, a misrepresentation under I(C).
  5. Corrective action: cite the third-party source, and confirm the material is sound before relying on it.

Answer: Yes. She violates Standard I(C) by presenting another firm's work as her own. She should credit the source in the report and correct the version already sent to clients.

Example 2

A portfolio manager tells prospective clients that his strategy 'has never lost money for clients and will keep protecting capital'. His strategy lost value in one year, but he reports only the other years. Evaluate the statements.

Show the solution
  1. Identify the statements: 'never lost money' and 'will keep protecting capital'.
  2. Test the first: the strategy lost value in one year, so it is false and he knows it.
  3. Test the second: it is a guarantee of future results, which cannot be assured.
  4. Test the omission: leaving out the losing year makes the record misleading.
  5. Conclude and correct: he must remove the claims and present performance fairly and completely.

Answer: He violates Standard I(C) because he knowingly made a false claim, guaranteed future results and omitted a losing year. He should withdraw the claims and give an accurate, complete performance record, consistent with Standard III(D).

Exam tips

  • Look for the word knowingly and check what the member knew or failed to check before choosing violation. Reckless or careless misstatements also violate the Standard.
  • In plagiarism items, the right answer usually adds credit or removes the unattributed material.
  • Watch for guarantees of returns and for performance shown without the unfavorable periods.
  • Name the Standard in constructed responses, then give one line of reasoning and one corrective action.
  • Do not stop at I(C) if the facts also touch III(D), V(A) or VII(B); name the related Standard if the question asks which are violated.

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 is Standard I(C) Misrepresentation?

It prohibits knowingly making false statements or misleading omissions about investment analysis, recommendations, actions or other professional activities. The Handbook also treats reckless or careless misleading statements as violations. It covers plagiarism and misleading claims about services, performance and qualifications.

Does rewording someone else's research avoid plagiarism?

No. If you use another person's ideas, analysis or data and present them as yours, you must credit the source. Changing the words does not remove that duty.

Can I use my firm's work product?

Yes. Work product owned by your employer may be used by the firm's employees under the firm's policy, without crediting individual contributors. Do not claim individual credit for it, and do not take it to a new employer without permission.

How do I avoid plagiarism under the CFA Standards?

Credit the source of any words, ideas, data, charts or models that are not yours. Check that third-party material is sound before relying on it. Keep records of where your material came from.