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CFA Level I · CFA Level I Exam · Guidance for Standard III: Duties to Clients

Two years ago, Priya Nair, a CFA charterholder, ended her advisory relationship with a client, Mr. Okafor. A journalist now asks her about the client's past portfolio holdings. Under Standard III(E), Nair most likely should:

Nair should decline to disclose. Standard III(E) covers current, former and prospective clients, so confidentiality continues after the relationship ends. Only client permission, a legal requirement, or information about client illegal activity would allow disclosure.

  1. Adecline to disclose, because confidentiality continues after the client relationship has endedCorrect
  2. Bdisclose the holdings, because the duty ended when the client became a former client
  3. Cdisclose the holdings, provided she does not name the client in the article

Explanation

Standard III(E) protects information about current, former and prospective clients. The relationship ending does not release Nair from the duty. The second option is wrong because the duty continues after termination. The third is wrong because disclosing the holdings still breaches the duty without the client's permission, law, or illegal activity.

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