Ethical Decision-Making in Insider Information

Very Easy Professional Standards Application Ethical Decision-making

As a CFA charterholder working as an investment advisor, you receive a request from a long-time client to provide them with insider information about a company you are currently analyzing. The client insists that they would only use this information to make decisions on their investments and not disclose it further.

As you consider the request, it is essential to remember the CFA Institute's Code of Ethics and Standards of Professional Conduct, particularly regarding ethical decision-making and the prohibition of insider trading.

In this scenario, what should you do?

Agree to provide the insider information to the client as they are a trusted customer.

Politely decline the request and explain that sharing insider information would violate ethical standards.

Consult with a legal advisor before deciding whether to provide the information.

Hint

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