Frequently Asked Questions: Ethics

Many of our representatives had the same concern when they initially considered getting into this business. And you’re right to be concerned, after all, you worked very hard to obtain your CPA designation, it’s your bread and butter, and I would want to protect that too.

There used to be a statutory concern for CPAs across the United States if they accepted commissions. However, since the Federal Trade Commission filed it’s injunction against the AICPA charging that the AICPAs restriction on commissions was a prohibitive trade practice in the late ‘80’s, 47 states and/or state CPA societies have overturned their statutes or rules in favor of CPAs receiving commissions.

If you are concerned and live in one of the states that do not allow CPAs to accept commissions, look into offering fee-based services by affiliating as a Fee-planning affiliate of H.D. Vest.

You are able to offer financial services to all of your clients except those your firm does audit work for. Because independence is crucial to audit work doing offering financial services in those situations may make it impossible for you to maintain your independence.

If you don’t feel comfortable accepting commissions, and many Advisors feel the same way, you should look at affiliating as a Fee-Planning affiliate. By choosing this affiliation option you will become an Advisory Representative which will enable you to charge fees on an hourly basis and offer any of our four world class fee-based money management programs. These programs cover just about all the different client needs you will encounter and are very flexible. The minimum investments start as low as $25,000. The bottom line is, no matter what method you choose commissions or fee-based, we have the support and solutions you need to be successful in this business.

Planning revenues are a form of compensation. They’re not a conflict of interest unless you allow them to be. While you want to maintain your objectivity, you can ill afford to devote time to a client for which you are not compensated. Balancing this seemingly opposing situation is not as difficult as it may first appear. The main consideration is meeting the needs of your clients.

Stop and think. You’re already a successful professional. Do you really think you would jeopardize what you have worked so hard to achieve just by making a commission? If the conflict of interest question really bothers you, ask your clients if they think it is a conflict of interest. When you ask your clients, you’ll find they do not consider it a conflict and that most prefer to pay someone they trust to help them with their financial planning needs.