Managing Conflicts of Interest in Recommendations

Rachel is a compliance officer at an investment advisory firm. She discovers that one of the firm's portfolio managers, David, holds a significant amount of stock in a company he frequently recommends to clients. Rachel is concerned that this ownership may create a conflict of interest. She raises the issue in a team meeting, suggesting that David should disclose his ownership to clients, but David argues that the firm’s investment decisions are made independently of personal stakes. What course of action should Rachel recommend to properly address this conflict of interest?