NISM Certifications · NISM-Series-X-A: Investment Adviser (Level 1) · Ethical Issues
An investment adviser registered under the SEBI (Investment Advisers) Regulations, 2013 learns that a client's spouse, who is not the client, has called asking for details of the client's portfolio. Which action is most consistent with the adviser's ethical duty of confidentiality?
The adviser should decline to disclose the information without the client's consent. Client information is confidential, and a spouse is a third party unless the client has authorised disclosure. Even partial details or a promise of secrecy do not remove the duty, unless the law requires disclosure.
- AShare the details since spouses share family finances
- BShare only the current portfolio value, not the holdings
- CDecline to disclose without the client's consentCorrect
- DShare the details if the spouse promises to keep them private
Explanation
Client information is confidential and may be disclosed only with the client's consent or when required by law. A spouse is a third party unless authorised by the client. Partial disclosure, such as the portfolio value, is still disclosure of confidential data.
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