CFP Board Imposes Public Sanctions on 13 Individuals

WASHINGTON, Nov. 1, 2022 /PRNewswire/ -- Certified Financial Planner Board of Standards, Inc. (CFP Board) announced today public sanctions against 13 current or former CFP^® professionals or candidates for CFP^® certification, effective immediately or on the date noted in each case. Public sanctions taken by CFP Board, in order of increasing severity, include Public Censures, Suspensions, Temporary Bars, Permanent Bars and Revocations of the right to use the CFP^® marks.

As part of their certification, CFP^® professionals make a commitment to CFP Board to abide by CFP Board's Code of Ethics and Standards of Conduct (Code and Standards) or its predecessor, theStandards of Professional Conduct (Standards), which included the Code of Ethics and Professional Responsibility, Rules of Conduct and Financial Planning Practice Standards. Individuals on the pathway to CFP^® certification make a commitment to abide by CFP Board's Pathway to CFP^® Certification Agreement (Pathway Agreement). 

CFP Board's Procedural Rules set forth the process for investigating matters and imposing sanctions where violations have been found.

CFP Board enforces its ethical standards by investigating alleged violations and, where there is probable cause to believe there are grounds for sanction, presents a Complaint containing the alleged violations to CFP Board's Disciplinary and Ethics Commission (Commission). The Commission meets at least six times a year to review any matter in which CFP Board has alleged that a CFP^® professional has violated CFP Board's Code and Standards or its predecessor Standards, or an individual pursuing initial CFP^® certification has violated the Pathway Agreement. The Commission functions in accordance with the Procedural Rules and reviews all matters on a case-by-case basis, considering the details specific to an individual case. If the Commission determines there are grounds for sanction, then it may impose a sanction. Commission orders may be appealed by a Respondent or CFP Board pursuant to the Procedural Rules.

In certain circumstances, such as when a CFP^® professional is in default due to failure to acknowledge receipt of a Notice of Investigation or file an Answer, CFP Board staff must deliver an Administrative Order of Suspension, Temporary Bar, Revocation or Permanent Bar. Administrative Orders are subject to appeal.

More information on CFP Board's enforcement process can be found at CFP.net/enforcement. In addition, at CFP.net/verify, CFP Board provides the public with:

• An individual's CFP Board disciplinary history and CFP^® certification status.
• Links to other sources of information about CFP^® professionals that may be more recent or that may contain information that has not led to CFP Board discipline and does not appear on CFP Board's website. This information may include customer disputes, disciplinary actions taken by a regulator or employer, certain criminal matters and certain financial matters (such as bankruptcy proceedings and unpaid judgments or liens).
• Links to the Financial Industry Regulatory Authority's (FINRA's) BrokerCheck and the U.S. Securities and Exchange Commission's (SEC's) Investment Adviser Public Disclosure databases for individuals who are subject to FINRA or SEC oversight.

A short summary of each sanction can be found below.

Scott Taubman, CFP^® (Peoria, Arizona): In September 2022, CFP Board issued a Public Censure to Mr. Taubman pursuant to Article 3.4.d. of the Procedural Rules after Mr. Taubman admitted he filed a single personal bankruptcy in the U.S. Bankruptcy Court, District of Arizona on September 1, 2022; confirmed that he has no other bankruptcy matters; and admitted that his conduct violated Standard E.2.c. of the Code of Ethics and Standards of Conduct. Accordingly, Mr. Taubman received a Public Censure.

Kristopher Moody, CFP^® (Boca Raton, Florida): In September 2022, the Disciplinary and Ethics Commission (Commission) and Mr. Moody entered into a Consent Order in which Mr. Moody agreed that CFP Board would issue a Public Censure with Remedial Work in the form of continuing education. In the Consent Order, Mr. Moody consented to findings that he breached his fiduciary duty while providing financial planning services to a couple that was involved in divorce proceedings. Specifically, after he was informed that the couple would be divorcing, he failed to make any conflict of interest disclosure, which was required when he learned of the impending divorce because his duties to one spouse were adverse to his duties to the other spouse. Mr. Moody also violated his fiduciary duty to the spouses when he failed to avoid the conflict of interest presented by the clients' divorce and provided financial advice to one spouse using information Mr. Moody obtained in the joint representation of the clients that was potentially detrimental to the other spouse while both spouses remained his clients. In the Consent Order, Mr. Moody consented to findings that he violated Standards A.1.a.ii. and A.1.a.iii. of the Code of Ethics and Standards of Conduct based on his breach of his duty of loyalty for failing to avoid a conflict of interest and by providing advice to one client that was potentially detrimental to the other client. Additionally, Mr. Moody consented to findings that his conduct violated Rules 2.2(b) and 2.2(e) of the Rules of Conduct when he failed to make the required written conflict of interest disclosure after his financial planning clients informed him of an impending divorce. Accordingly, the Commission issued to Mr. Moody a Public Censure with Remedial Work.

Robert A. Goshen, CFP^® (Highwood, Illinois): In September 2022, CFP Board issued a Public Censure to Mr. Goshen pursuant to Article 3.4.d. of the Procedural Rules after Mr. Goshen admitted he filed a single personal bankruptcy in the U.S. Bankruptcy Court, Northern District of Illinois (Eastern Division) on May 16, 2022; confirmed that he had no other bankruptcy matters; and admitted that his conduct violated Standard E.2.c. of the Code of Ethics and Standards of Conduct. Accordingly, Mr. Goshen received a Public Censure.

Gregory A. Chona (Crown Point, Indiana): In August 2022, the Disciplinary and Ethics Commission (Commission) issued an order in which Mr. Chona received a Public Censure. The Commission determined that Mr. Chona violated Rule 6.5 of the Rules of Conduct, which provides that a certificant shall not engage in conduct which reflects adversely on his integrity or fitness as a certificant, upon the CFP^® marks, or upon the profession, when he incurred a tax liability and failed to timely pay taxes to the Internal Revenue Service (IRS), resulting in the IRS filing a federal tax lien against him. While the lien has since been released to permit a short sale of Mr. Chona's property, he has outstanding taxes due for tax years 2011, 2012, and 2014 through 2016 totaling approximately $131,000. The Commission noted as mitigating factors that personal issues and an attempted business acquisition affected his ability to pay taxes. The Commission also noted that Mr. Chona was making payments to the IRS but had not yet established an Offer in Compromise or Installment Agreement with the IRS. Accordingly, the Commission determined to issue Mr. Chona an Order of Public Censure. Mr. Chona relinquished his CFP^® certification in February 2022.

John R. James, CFP^® (Rapid City, South Dakota): In September 2022, the Disciplinary and Ethics Commission (Commission) and Mr. James entered into a Consent Order in which Mr. James agreed that CFP Board would issue a Public Censure. In the Consent Order, Mr. James consented to findings that he was convicted for Driving Under the Influence in 2013 and Hit and Run in 2016, both misdemeanors. Mr. James consented to findings that this conduct reflected adversely on himself, the CFP^® marks and the profession, in violation of Rule 6.5 of the Rules of Conduct. In addition, due to his failure to report these convictions, the California Department of Insurance issued a 2017 Decision and Order Adopting Proposed Decision wherein it revoked Mr. James' California insurance license. Based on this license revocation, Mr. James received a statutory disqualification from the Financial Industry Regulatory Authority (FINRA) and subsequent termination from his firm. Mr. James consented to findings that this conduct represented a failure to comply with applicable laws, rules and regulations governing his professional services, in violation of Rule 4.3 of the Rules of Conduct. The Commission issued to Mr. James a Public Censure.

Lee G. Harris (Muskegon, Michigan): In September 2022, CFP Board issued an administrative order temporarily barring Mr. Harris from applying for or obtaining the CFP^® certification marks for one year and one day. This sanction followed Mr. Harris' relinquishment of his certification and failure to acknowledge receipt of CFP Board's Notice of Investigation, as required by Article 1.1 of the Procedural Rules. CFP Board sought to investigate two civil judgments filed against Mr. Harris for a total of $29,908. Mr. Harris' conduct may have violated Standard E.2 of the Code of Ethics and Standards of Conduct, which provides that a CFP^® professional may not engage in conduct that reflects adversely on the CFP^® professional, the CFP^® marks or the profession. Under Article 4.1.a. of the Procedural Rules, Mr. Harris has been deemed in default, and CFP Board issued an Administrative Order of Temporary Bar. Mr. Harris' administrative temporary bar was effective as of October 10, 2022.

David A. Dickson (Orangevale, California): In June 2022, CFP Board issued an order in which Mr. Dickson received a three-month suspension of his certification and right to use the CFP^® marks with Remedial Work. This sanction followed an appeal of a December 2021 decision by the Disciplinary and Ethics Commission (Commission). The Code and Standards Enforcement Committee of CFP Board (Enforcement Committee) affirmed the Commission's findings that Mr. Dickson prioritized making payments for his children's private education over payment of taxes to the Internal Revenue Service (IRS) for nine tax years, resulting in the IRS filing a federal tax lien against Mr. Dickson totaling $89,725. As of August 2020, Mr. Dickson had an outstanding tax balance of $239,156, and at the time of the hearing before the Commission, Mr. Dickson was making timely payments to the IRS pursuant to an Installment Agreement. The Enforcement Committee also affirmed the Commission's finding that Mr. Dickson's conduct violated Rule 6.5 of the Rules of Conduct, which provides that a certificant shall not engage in conduct which reflects adversely on his integrity or fitness as a certificant, upon the CFP^® marks, or upon the profession. In addition, the Enforcement Committee affirmed the Commission's requirement that Mr. Dickson perform additional remedial work by certifying that he has fully complied with all requirements of the Installment Agreement at the end of the suspension. Any failure to comply with the certification requirement shall be considered a default, as defined by Article 11.4 of the Procedural Rules, with Mr. Dickson subject to an Administrative Order of Suspension for one year and one day. Accordingly, CFP Board issued to Mr. Dickson a Suspension for three months with Remedial Work. Mr. Dickson's suspension is effective from September 6, 2022, until December 6, 2022.

Edwin G. Treimanis (Tampa, Florida): In September 2022, the Disciplinary and Ethics Commission (Commission) issued an order in which Mr. Treimanis received a suspension of one year and one day of his certification and right to use the CFP^® marks. The Commission determined that Mr. Treimanis violated Rule 6.5 of the Rules of Conduct, which provides that a certificant shall not engage in conduct which reflects adversely on his integrity or fitness as a certificant, upon the CFP^® marks, or upon the profession, when he failed to pay his taxes in full or timely file his tax returns for 14 tax years from 2003 to 2020, resulting in the Internal Revenue Service (IRS) filing four federal tax liens against him that totaled more than $66,043.35, for a total amount due for all outstanding tax years, with accrued interest and penalties, of $114,252.06. As of the date of the hearing, Mr. Treimanis did not have an Installment Agreement or Offer in Compromise in place with the IRS. Accordingly, the Commission issued to Mr. Treimanis a Suspension of one year and one day. The suspension is effective from October 10, 2022, to October 11, 2023.

Steven J. Thompson (Salt Lake City, Utah): In September 2022, the Disciplinary and Ethics Commission (Commission) issued an order in which Mr. Thompson received a suspension of one year and one day of his certification and right to use the CFP^® marks. The Commission determined that Mr. Thompson violated Rule 6.5 of the Rules of Conduct, which provides that a certificant shall not engage in conduct which reflects adversely on his integrity or fitness as a certificant, upon the CFP^® marks, or upon the profession, when he incurred a tax liability for more than 10 years from 2006 through 2018, resulting in the Internal Revenue Service (IRS) filing federal tax liens against him that totaled more than $300,000 with accrued interest and penalties. As of the date of the hearing, Mr. Thompson had reduced his debt but did not have an Installment Agreement or Offer in Compromise in place with the IRS and had failed to implement his own plan to pay off the tax debt by refinancing his home. Accordingly, the Commission issued to Mr. Thompson a Suspension of one year and one day. The suspension is effective from October 3, 2022, to October 4, 2023.

Mark W. Just (Carmel, Indiana): In July 2022, CFP Board issued an administrative order permanently barring Mr. Just from applying for or obtaining the CFP^® certification marks. This sanction followed Mr. Just's failure to renew his certification and failure to file an Answer to CFP Board's Complaint within the required time frame. CFP Board alleged that Mr. Just failed to cooperate with CFP Board's investigation of two customer arbitrations and a Financial Industry Regulatory Authority (FINRA) Letter of Acceptance, Waiver, and Consent (AWC) dated May 12, 2022, for two unreported tax liens. The AWC imposed a three-month suspension and a $5,000 fine. CFP Board's Complaint alleged that Mr. Just failed to satisfy his Duty of Cooperation, thereby violating Standard E.5 of the Code of Ethics and Standards of Conduct. Mr. Just failed to file an Answer to CFP Board's Complaint within 30 calendar days of the date of service, as required by Article 3.2 of the Procedural Rules. Under Article 4.1.b. of the Procedural Rules, Mr. Just has been deemed in default, and CFP Board issued an Administrative Order of Permanent Bar. Mr. Just's administrative permanent bar was effective as of August 15, 2022.

Donald Padilla (Encino, California): In August 2022, CFP Board issued an order in which Mr. Padilla received a revocation of his certification and his right to use the CFP^® certification marks. This sanction followed an appeal of a March 2022 Order of Revocation from the Disciplinary and Ethics Commission (Commission). The Appeals Commission of CFP Board affirmed the Commission's findings that Mr. Padilla failed to comply with applicable regulatory requirements governing professional services to the client and his firm's policies and procedures when he used unapproved email accounts and hid the unapproved emails from his firm during branch audits, resulting in his voluntary resignation from the firm, a five-month suspension in all capacities, and a $10,000 fine from the Financial Industry Regulatory Authority (FINRA). The Appeals Commission also affirmed the Commission's finding that Mr. Padilla was terminated from a second firm for his failure to follow company policy regarding correspondence and marketing designations and from a third firm while he was under investigation by FINRA with respect to his email usage at the first firm. Because forgivable loans extended to Mr. Padilla by these two firms became due when he was terminated, he became indebted to one firm for $275,000 and the other for over $333,000. When Mr. Padilla failed to repay these amounts, one firm filed an arbitration with FINRA, resulting in an award against Mr. Padilla for over $333,000. The Appeals Commission also affirmed the Commission's finding that Mr. Padilla failed to comply with the arbitration award and that FINRA suspended him until the debt was satisfied or discharged. It further affirmed the Commission's finding that Mr. Padilla then filed for Chapter 7 bankruptcy protection to discharge these outstanding firm debts as well as an additional $100,000 in personal consumer credit card debt, resulting in over $600,000 discharged in bankruptcy. In addition, the Appeals Commission affirmed the Commission's finding that Mr. Padilla's bankruptcy filing demonstrated his inability to manage responsibly his personal and business financial affairs, which reflects adversely on his integrity or fitness as a CFP^® professional, upon the CFP^® marks, or upon the profession in violation of Standard E.2 of the Code of Ethics and Standards of Conduct and Rule 6.5 of the Rules of Conduct. Pursuant to the decision of the Appeals Commission, Mr. Padilla's revocation was effective August 12, 2022.

David M. Hoff (Lake St. Louis, Missouri): In July 2022, CFP Board issued an administrative order permanently revoking Mr. Hoff's right to use the CFP^® certification marks. This sanction followed Mr. Hoff's failure to participate in CFP Board's investigation and failure to file an Answer to CFP Board's Complaint within the required time frame. CFP Board alleged that it was investigating an August 2, 2021, Securities and Exchange Commission (SEC) Cease and Desist Order (Order) entered into by a firm of which Mr. Hoff is a control person. The Order stated that the firm breached its fiduciary duty by failing to disclose three types of compensation received by its affiliated broker and the associated conflicts of interest. The Order provided that this compensation included the receipt of revenue-sharing payments from an unaffiliated clearing broker as a result of the firm's advisory clients' investments in certain mutual funds, including certain cash sweep money market mutual funds. According to the Order, the mutual funds and money market funds that resulted in revenue-sharing payments were generally more expensive than lower-cost options available to clients, including in many instances when there were lower-cost share classes of the same mutual funds available to clients that did not result in any revenue sharing. In addition, since at least January 2014, the firm's affiliated broker received compensation resulting from the markup of several clearing broker fees charged to the firm's advisory clients. CFP Board's Complaint alleged that Mr. Hoff failed to satisfy his Duty of Cooperation, thereby violating Standard E.5 of the Code of Ethics and Standards of Conduct. Mr. Hoff failed to file an Answer to CFP Board's Complaint within 30 calendar days of the date of service, as required by Article 3.2 of the Procedural Rules. Under Article 4.1.b. of the Procedural Rules, Mr. Hoff has been deemed in default, and CFP Board issued an Administrative Order of Revocation. Mr. Hoff's administrative revocation was effective as of July 6, 2022.

David R. Nute (Sequim, Washington): In July 2022, CFP Board issued an order in which Mr. Nute received a revocation of his certification and his right to use the CFP^® certification marks. This sanction followed an appeal of a January 2022 Order of Revocation from the Disciplinary and Ethics Commission (Commission). The Code and Standards Enforcement Committee of CFP Board (Enforcement Committee) affirmed the Commission's findings that Mr. Nute failed to treat fellow professionals and others with dignity, courtesy, and respect in violation of Standard A.7 of the Code of Ethics and Standards of Conduct (Code and Standards). The Enforcement Committee also affirmed the Commission's finding that a former prospective Client, who submitted a written grievance to CFP Board, asked Mr. Nute if she could drop off copies of documents needed for a potential transaction in person at his office, rather than transmit them electronically. When Mr. Nute responded that his time was "too valuable" to make the trip to his office to pick up the documents, the former prospective Client sent him an email stating that she no longer desired to work with him. Mr. Nute replied to her email, stating, among other things: "It is totally ridiculous to expect me to drive into town and waste a couple hours of $1,000 hourly time" and "I was only trying to help and your reactions tell me why your husband left you." The Enforcement Committee also affirmed the Commission's finding that, by using this language with the former prospective Client, Mr. Nute violated Standard A.7 of the Code and Standards. The Enforcement Committee affirmed the Commission's finding of many relevant aggravating factors, including that (1) Mr. Nute contended that he was entitled to behave in this manner because the individual was no longer a prospective Client and, therefore, he could personally insult her; (2) he did not show any remorse during the investigation or the hearing; (3) Mr. Nute did not treat CFP Board Counsel with dignity, respect, or professional courtesy and frequently referred to CFP Board Counsel in derogatory terms and insulted them in written correspondence and verbally during the hearing; (4) at the hearing, Mr. Nute failed to testify with decorum and blatantly ignored instructions to engage with civility; (5) he received multiple negative reviews on the internet from customers detailing similar unprofessional behaviors, which is evidence of a pattern of misconduct; (6) Mr. Nute's misconduct was emotionally abusive, causing harm to the former prospective Client, and he refused to acknowledge his cruelty; and (7) the Commission issued a warning to him in 2013 about a similar interaction with a prospective Client. Pursuant to the decision of the Enforcement Committee, Mr. Nute's revocation was effective July 19, 2022.

Certified Financial Planner Board of Standards, Inc. is the professional body for personal financial planners in the U.S. CFP Board sets standards for financial planning and administers the prestigious CFP^® certification – one of the most respected certifications in financial services – so that the public has access to and benefits from competent and ethical financial planning. CFP Board, along with its Center for Financial Planning, is committed to increasing the public's awareness of CFP^® certification and access to a diverse, ethical and competent financial planning workforce. Widely recognized by the public, advisors and firms as the standard for financial planning, CFP^® certification is held by more than 93,000 people in the United States.

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SOURCE Certified Financial Planner Board of Standards, Inc.