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Home My WebLink About991300.tiff MEMORANDUM V © COU :TY'^ ElkTO: Board of County Commi si ers May 21;116'997 II: i COLORADO From: Art Willis, Treasurer CLER: C1 ; SUBJECT: Notification of Pro sional Standards As a candidate for certification as a Chartered Financial Analyst from the Association for Investment Management and Research (AIMR), I am required to inform my employer of my obligation to comply with AIMR's Code of Ethics and Standards of Professional Conduct and to deliver a copy of the Code and Standards to my employer. Although I am not technically in an employer-employee relationship with the Board of Commissioners, my investment activity and performance fall under the Board's purview. To comply with the Standards, I have attached a copy of AIMR's Code and Standards for the Board's files. Should the Board desire further information regarding my responsibilities and activities in relation to AIMR, I would be happy to provide it. cc: Don Warden, Director of Finance Bruce Barker, County Attorney 991300 "4"' IMR Association for Investment Management and Research Code of Ethics and Standards of Professional Conduct As amended and restated May 5, 1996 The Code of Ethics Members of the Association for Investment Management and Research shall: • Act with integrity, competence, dignity, and in an ethical manner when dealing with the public, clients, prospects, employers, employees, and fellow members. • Practice and encourage others to practice in a professional and ethical manner that will reflect credit on members and their profession. • Strive to maintain and improve their competence and the competence of others in the profession. • Use reasonable care and exercise independent professional judgment. The Standards of Professional Conduct STANDARD I: FUNDAMENTAL RESPONSIBILITIES STANDARD III: RELATIONSHIPS WITH AND RESPONSIBIUTIES TO Members shall: THE EMPLOYER A. Maintain knowledge of and comply with all applicable laws, A.Obligation to Inform Employer of Code and Standards. rules, and regulations (including AIMR's Code of Ethics and Members shall: Standards of Professional Conduct) of any government, 1. Inform their employer, in writing,through their direct regulatory organization, licensing agency, or professional supervisor, that they are obligated to comply with the Code association governing the members'professional activities. and Standards and are subject to disciplinary sanctions for B. Not knowingly participate or assist in any violation of such violations thereof. laws, rules, or regulations. 2. Deliver a copy of the Code and Standards to their employer STANDARD II: RELATIONSHIPS WITH AND RESPONSIBILITIES TO if the employer does not have a copy. THE PROFESSION B. Duty to Employer. Members shall not undertake any A.Use of Professional Designation. independent practice that could result in compensation or 1. Membership in AIMR,the Financial Analysts Federation other benefit in competition with their employer unless they (FAF), or the Institute of Chartered Financial Analysts obtain written consent from both their employer and the (ICFA) may be referenced by members of these persons or entities for whom they undertake independent organizations only in a dignified and judicious manner.The practice. use of the reference may be accompanied by an accurate explanation of the requirements that have been met to C. Disclosure of Conflicts to Employer. Members shall: obtain membership in these organizations. 1. Disclose to their employer all matters, including beneficial 2. Holders of the Chartered Financial Analyst designation may ownership of securities or other investments,that use the professional designation"Chartered Financial reasonably could be expected to interfere with their duty to Analyst"or the mark"CFA,"and are encouraged to do so, their employer or ability to make unbiased and objective but only in a dignified and judicious manner.The use of the recommendations. designation may be accompanied by an accurate 2. Comply with any prohibitions on activities imposed by their explanation of the requirements that have been met to employer if a conflict of interest exists. obtain the designation. 3. Candidates may reference their participation in the CFA D.Disclosure of Additional Compensation Arrangements. Program, but the reference must clearly state that an Members shall disclose to their employer in writing all individual is a candidate for the CFA designation and may monetary compensation or other benefits that they receive for not imply that the candidate has achieved any type of their services that are in addition to compensation or benefits partial designation. conferred by a member's employer. B. Professional Misconduct. Members shall not engage in any E. Responsibilities of Supervisors. Members with supervisory professional conduct involving dishonesty,fraud, deceit, or responsibility, authority, or the ability to influence the conduct misrepresentation or commit any act that reflects adversely on of others shall exercise reasonable supervision over those their honesty, trustworthiness, or professional competence. subject to their supervision or authority to prevent any violation of applicable statutes, regulations, or provisions of the Code C. Prohibition against Plagiarism. Members shall not copy or and Standards. In so doing, members are entitled to rely on use, in substantially the same form as the original, material reasonable procedures designed to detect and prevent such prepared by another without acknowledging and identifying the violations. name of the author, publisher, or source of such material. Members may use, without acknowledgment, factual STANDARD IV: RELATIONSHIPS WITH AND RESPONSIBILITIES TO information published by recognized financial and statistical CLIENTS AND PROSPECTS reporting services or similar sources. A.Investment Process. A.1 Reasonable Basis and Representations. Members shall: a. Exercise diligence and thoroughness in making investment recommendations or in taking investment actions. b. Have a reasonable and adequate basis, supported by regarding the purchase or sale of a security or ether investment, appropriate research and investigation,for such they shall give their clients and employers adequate opportunity recommendations or actions. to act on the recommendation before acting on their own behalf. c. Make reasonable and diligent efforts to avoid any material For purposes of the Code and Standards, a member is a misrepresentation in any research report or investment "beneficial owner if the member has: recommendation. a. a direct or indirect pecuniary interest in the securities; d. Maintain appropriate records to support the reasonableness b. the power to vote or direct the voting of the shares of the of such recommendations or actions. securities or investments; c. the power to dispose or direct the disposition of the security A.2 Research Reports.Members shall: a. Use reasonable judgment regarding the inclusion or or investment. exclusion of relevant factors in research reports. B.5 Preservation of Confidentiality.Members shall preserve b. Distinguish between facts and opinions in research reports. the confidentiality of information communicated by clients, c. Indicate the basic characteristics of the investment involved prospects, or employers concerning matters within the scope of when preparing for public distribution a research report that the client-member, prospect-member, or employer-member is not directly related to a specific portfolio or client. relationship unless the member receives information concerning illegal activities on the part of the client, prospect, or employer. A.3 Independence and Objectivity.Members shall use reasonable care and judgment to achieve and maintain B.6 Prohibition against Misrepresentation.Members shall not independence and objectivity in making investment make any statements, orally or in writing,that misrepresent: recommendations or taking investment action. a. the services that they or their firms are capable of B.Interactions with Clients and Prospects, performing; 8.1 Fiduciary Duties.In relationships with clients, members b. their member's qualifi a as omitr orq professional esi cf their talc shall use particular care in determining applicable fiduciary duty c. the ot academic imply, writing, , any and shall comply with such duty as to those persons and Members shall not make or ar orally investment in writing, any assurances or guarantees regarding any investment except to interests to whom the duty is owed. Members must act for the communicate accurate information regarding the terms of the benefit of their clients and place their clients'interests before their investment instrument and the issuer's obligations under the own. instrument. B.2 Portfolio Investment Recommendations and Actions. B.7 Disclosure of Conflicts to Clients and Prospects. Members shall: Members shall disclose to their clients and pros ts all matters, a. Make a reasonable inquiry into a client's financial situation, including beneficial ownership of securities or othher investments, investment experience, and investment objectives prior to that reasonably could be expected to impair the member's ability making any investment recommendations and shall update to make unbiased and objective recommendations. this information as necessary, but no less frequently than annually, to allow the members to adjust their investment 8.8 Disclosure of Referral Fees.Members shall disclose to recommendations to reflect changed circumstances. clients and prospects any consideration or benefit received by the b. Consider the appropriateness and suitability of investment member or delivered to others for the recommendation of any recommendations or actions for each portfolio or client.In services to the client or prospect. determining appropriateness and suitability, members shall consider applicable relevant factors, including the needs STANDARD V: RELATIONSHIPS WITH AND RESPONSIBILITIES TO and circumstances of the portfolio or client, the basic THE INVESTING PUBLIC characteristics of the investment involved, and the basic A. Prohibition against Use of Material Nonpublic Information. characteristics of the total portfolio. Members shall not make Members who possess material nonpublic information related a recommendation unless they reasonably determine that to the value of a security shall not trade or cause others to the recommendation is suitable to the client's financial trade in that security if such trading would breach a duty or if situation, investment experience, and investment objectives. the information was misappropriated or relates to a tender c. Distinguish between facts and opinions in the presentation offer. If members receive material nonpublic information in of investment recommendations. confidence, they shall not breach that confidence by trading or d. Disclose to clients and prospects the basic format and causing others to trade in securities to which such information general principles of the investment processes by which relates. Members shall make reasonable efforts to achieve securities are selected and portfolios are constructed and public dissemination of material nonpublic information shall promptly disclose to clients and prospects any disclosed in breach of a duty. changes that might significantly affect those processes. B. 8.3 Fair Dealing.Members shall deal fairly and objectively with1. Members shall not make any statements, orally or in writing, all clients and prospects when disseminating investment that misrepresent the investment performance that they or recommendations,disseminating material changes in prior their firm have accomplished or can reasonably be investment recommendations, and taking investment action. expected to achieve. 2. If members communicate individual or firm performance 8.4 Priority of Transactions.Transactions for clients andinformation directly or indirectly to clients or prospective employers shall have priority over transactions in securities or clients, or in a manner intended to be received by clients or other investments of which a member is the beneficial owner so prospective clients, members shall make every reasonable that such personal transactions do not operate adversely to their effort to assure that such performance information is a fair, clients'or employer's interests. If members make a recommendation accurate, and complete presentation of such performance. Hello