For Financial Planners

Holding Out and Titles

It is the responsibility of the registrant firm and those representatives at the firm who hold themselves out as a “financial planner" to ensure they have proper proficiency in financial planning. As noted in BCP 31-601(s. 4.6), communications with the public should leave no uncertainty as to the dealer or representative proficiency. This means that the descriptions and titles used on the registrants signs, business cards and in advertising should not mislead the public about the proficiency and qualifications of the representative providing services or advise.

To comply with this policy, the firm should have proper procedures outlining the business names, styles, salesperson qualifications and business titles that can be used at that dealer or advising firm. The firm needs to ensure that all representatives have been given the guidelines and should take steps to institute an effective compliance program that will detect when representatives at the firm are offside. To be effective the firm’s policies also need to be enforced.

Section 1.2.1(e) of the MFDA Rules state that no approved person shall hold him or herself out to the public in any manner including, without limitation, by the use of any business name or designation of qualifications or professional experience that deceives or misleads the public, a client or any other person as to the proficiency or qualifications of the Approved Person under the Rules or any applicable legislation.

Financial Planning Qualifications
Any representative that wishes to hold himself out as a “Financial Planner” or advertise that he or she provides financial planning services must be licensed by the Financial Planners Standards Council of Canada. If the representative is not licensed by this body, but has one of the qualifications below, then that person may hold himself out as a financial planner:

These requirements are minimum requirements and are subject to change. If the representative has other qualifications not included above, they may only be eligible by applying to the Executive Director for approval, on a case-by-case basis.

What would not be acceptable is where an individual has participated in a seminar and taken a financial planning course, but has not completed all the courses in a program of study. Partial completion of a program does not entail you have successfully completed a designation.

Fee for Service
If the individual intends to provide financial planning services on a fee-for-service basis, the individual must also:

• satisfy the Executive Director that the individual has "errors and omissions" insurance for a minimum of $1,000,000 coverage
• file, as part of the individual’s application for registration, a copy of a client disclosure statement that discloses:
  • the name(s) of the company or companies through which the individual will provide clients with financial planning services and the name(s) of the registered dealer(s) or adviser(s) through which the individual holds her or his registration under the Act
  • the means by which the financial planner generates income, including a schedule of fees
  • that the client is entitled to go elsewhere to implement any plan that the financial planner prepares for the client
  • if the client wishes the financial planner to implement a plan, that the client will become a client of the registered dealer through which the financial planner holds her or his registration under the Act, and that the financial planner will receive commissions from the registered dealer as a result of the implementation of the plan
  • if the financial planner receives any commissions or referral fees, disclosure in accordance with statutory requirements (see section 3.3 of this policy statement)
  • if the individual is also registered as an insurance salesman or agent under the Financial Institutions Act, R.S.B.C. 1996, c.141, that any insurance products sold by the individual to the client will also generate commissions to the financial planner the individual’s category of registration under the Act and Rules, and
  • other licenses, if any, held by the individual, including licenses under the Financial Institutions Act, R.S.B.C. 1996, c. 141, and the Real Estate Act, R.S.B.C. 1996, c. 397
• undertake to provide clients with a copy of the disclosure statement described above
• send the disclosure statement described above to each client annually and whenever there is a change in the circumstances that are required to be disclosed
• file a copy of the disclosure statement described above with the Executive Director, whenever there is a change in the circumstances that are required to be disclosed, and
• file, as part of the person’s application for registration, a copy of the business cards and letterhead that the person proposes to use [Act s. 34(2) ].

For further information review BC Policy 31-601, Part 4.6.