Planners Institute Adopts Ethics Code
Sudo, Philip T., American Banker
NEW YORK -- The Institute of Certified Financial Planners, or ICFP, has announced a new code of ethics that it called "the strongest and most comprehensive set of professional guidelines in the financial planning industry."
The announcement Monday came a few days after the Denver-based group and its sister organization, the College for Financial Planning, were criticized for unilaterally pursuing educational and testing standards for certified financial planners.
Last week, the institute and the college, which is also in Denver, announced formation of an international board of standards and practices to develop model state and federal legislation for uniform certified financial planner examination standards. The move was blasted as "disruptive" by the American College, a financial planning school in Bryn Mawr, Pa., because the plan did not involve other industry organizations.
Despite the intra-industry squabble, there is widespread agreement among organizations on the need for ethical and professional guidelines. The number of financial planners in the country has doubled in the last three years, according to the International Association for Financial Planning, known by the acronym IAFP, an Atlanta-based trade group.
The growth has been attributed to several factors:
* The rise in two-income households, creating more disposable income with less time to manage it.
* Deregulation of the financial services industry and the increasing complexity of the nation's tax code, leading to widespread consumer confusion about how to invest money.
* The societal trend toward specialization, with people paying experts to handle different aspects of their lives.
The growth has given financial planning schools a boon and has led hundreds of bankers, insurance agents, accountants, and lawyers into the field as well. …