Journal of Financial Planning: August 2025
David I. Hantman is a principal at Bressler, Amery & Ross (www.bressler.com) in the New Jersey and New York offices. He leads the firm’s expungement practice and represents broker–dealers, investment advisers, and other financial institutions, along with senior officers, executives, financial advisers, branch management, and other individuals in a wide range of securities, civil and employment-related matters in state court, arbitration, mediation, and regulatory forums. He also serves as a primary contact for regulatory reporting and disclosure issues and has vast experience dealing with the CFP Board on nearly a daily basis.
Kirsten M. Nowak is an associate at Bressler, Amery & Ross in the firm’s financial institutions practice group in Florida. She focuses her practice on the financial services industry and also assists with the firm’s expungement practice and CFP Board matters.
Many CFP® professional applicants are unaware of the intricacies of the CFP® application process, specifically the ethics review and how to answer questions. Applicants are often confused about how to answer questions and what information to disclose. This article endeavors to assist applicants by walking through each stage of the application process to ensure they can quickly receive the CFP® designation after passing the CFP® exam and will address key concerns of which applicants should be aware.
Ethics Declaration
The application for CFP® certification requires completion of the ethics declaration relevant to fitness to become a CFP® professional. The ethics declaration contains a series of questions concerning: criminal charges, regulatory actions, civil actions (including arbitrations), customer complaints, employment separation, and personal financial issues (bankruptcy/liens). It is imperative to closely review the specific language of these questions. Many questions have key terms that are defined by the CFP Board in its Code of Ethics and Standards of Conduct, which should be referenced in conjunction with completing the declaration.
While complete and accurate disclosure on an application is required and essential, an applicant’s disclosure should be relevant and responsive to the specific questions. Many applicants incorrectly believe erring on the side of caution or over-disclosing will somehow evidence high ethical standards, benefiting their application. The two most frequent examples we see regarding inaccurate disclosures involve customer complaints and criminal charges. For customer complaints, just because an applicant has received a customer complaint does not necessarily mean that complaint is a reportable customer complaint requiring disclosure under the Code of Ethics. Rather, there are several elements of a complaint that must be satisfied to be a reportable customer complaint to the CFP Board. Similarly, we have seen numerous examples of confusion surrounding the dollar threshold for customer complaints leading to under-disclosure. Question 6 of the ethics disclosure requires applicants to disclose complaints that contain a claim for compensation of $5,000 or more or a sales practice violation that settled for an amount of $15,000 or more. Many applicants fail to recognize the “or” and as a result, fail to disclose a customer complaint otherwise requiring disclosure based on this oversight (e.g., when there is a claim for $7,000 that settles for $2,500, this is reportable).
Additionally, applicants tend to over-disclose whether they have been charged with a misdemeanor. As an initial matter, there is a difference between being arrested and being charged (the CFP Board requests disclosure of charges, not arrests). The CFP Board defines a “relevant misdemeanor” as “[a] criminal offense, that is not a felony, for conduct involving fraud, theft, misrepresentation, other dishonest conduct, crimes of moral turpitude, violence, or a second (or more) alcohol and/or drug-related offense.” Prior to disclosing, it may be necessary to research the applicable law for the specific elements of the crime charged to determine whether it meets the definition of a relevant misdemeanor. For example, there are certain classes of misdemeanor assault that are not considered crimes of violence and would, therefore, not be reportable as a relevant misdemeanor.
Providing responses to the CFP Board that are neither relevant nor responsive may subject applicants to further scrutiny, additional inquiries, and delay the application process. In the same vein, failing to disclose or affirmatively respond to questions when required may also delay the application process and lead to further scrutiny. If an applicant answers yes to any question on the ethics declaration or fails to answer yes when otherwise required (and is revealed in the background check described below), the CFP Board typically initiates a Notice of Inquiry, requiring the applicant to provide a detailed statement and additional documents. Simply stated, it is particularly important to provide disclosures that are only relevant and responsive, or seek guidance from a regulatory attorney experienced in dealing with the CFP Board.
Background Check
As part of the application process, the CFP Board will review the ethics declaration, disclosures available through FINRA BrokerCheck and the SEC’s Investment Adviser Public Disclosure database, and public records for items such as litigation, liens, judgments, bankruptcies, and criminal matters. While this is a separate step in the application process, the CFP Board will compare an applicant’s responses in the ethics declaration with the results of its background check. An applicant’s failure to disclose or accurately respond to an ethics disclosure question may lead to denial of the application, or, more likely, further investigation by the CFP Board, including a Notice of Inquiry or fitness determination.
Fitness Standards
The CFP Board will review the results of the ethics declaration and background check and determine whether the applicant’s conduct meets specific character and fitness standards. The fitness standards contain three categories of conduct that may prevent an individual from obtaining CFP® certification: (a) conduct that presents an Absolute Bar, (b) conduct that renders an applicant currently ineligible, and (c) conduct that requires the applicant to petition the disciplinary and ethics commission (DEC) for an order finding ethical fitness in accordance with CFP Board’s Procedural Rules. It is important for applicants to be aware of these fitness standards before studying for the exam, and when submitting an application, because they present potential impediments toward certification.
An Absolute Bar presents a permanent bar to certification. This includes professional discipline related to intentional or reckless fraud, theft of client funds, misrepresentation to clients, or other dishonest conduct involving clients. This also includes felony conviction for a variety of crimes, including theft, embezzlement, or other financially related crimes. If there is any confusion about whether conduct constitutes an Absolute Bar, the applicant should seek outside counsel or clarification from the CFP Board. Individuals subject to an Absolute Bar should not study for exams and should immediately cease the application process.
A Presumptive Bar will bar an individual from becoming certified unless the individual petitions the DEC for a fitness determination, and the DEC grants the petition. This conduct includes professional discipline (bar, suspension, revocation of professional license), statutory disqualification, and surrender of professional license due to Regulatory Action or Regulatory Investigation. Notably, if Enforcement staff detects information requiring further investigation (catch all), it will issue a Notice of Investigation. Applicants subject to a Presumptive Bar should strongly consider whether to proceed with their application, as this may provide a significant roadblock to certification.
A Petition for Fitness Determination is required for other conduct, including professional discipline, felony conviction (that is not an Absolute Bar), a relevant misdemeanor conviction (as defined), one or more personal or business bankruptcies, unsatisfied tax liens or judgment, a civil finding, and three or more client disputes, among other conduct. Applicants who engaged in this conduct should carefully evaluate the risks (and costs) of proceeding with their application and consider retaining experienced regulatory counsel to discuss their options and represent them.
Approval and Notification of Designation
Absent any disclosures, conduct, or other issues warranting further review, the CFP Board typically moves quickly in reviewing and approving applications. Once approved, the CFP Board sends a simple congratulations email notifying individuals they may use the designation. While the application and disclosure process can feel overwhelming, being aware of and providing only relevant and responsive disclosures to the CFP Board to facilitate its review is crucial for success.