CFA Level 1 - Ethics, Professional Standards, and GIPS

What does The Handbook connect?

Code of Ethics and Standards of Professional Conduct

What are recommended compliance procedures for members and candidates?

1. Stay informed 2. Review procedures 3. Maintain current files

What are violations of loyalty to employers?

1. Stealing trade secrets 2. Misuse of confidential information 3. Soliciting employer's clients prior to leaving 4. Self-dealing 5. Misappropriation of client lists

How long must discontinued composites be listed?

5 years

What is the minimum amount of data to be shown in a performance presentation under GIPS?

5 years initially (unless firm has existed for less) then add each year following the 5 years up until year 10. Always include the past 10 years of data following.

How long should all actual fee-paying, discretionary portfolios be included in a composite?

5 years or since the firm or composite inception

What is the recommended record retention period for a m/c when no regulatory standards or firm policies are in place?

7 year minimum holding period

What is a restricted list?

Companies that are removed from the research universe to avoid dissemination of adverse opinions

Stakeholders

Individuals or groups of individuals who could be affected either directly or indirectly by a decision (Have a stake in decision)

What is a 'firewall' at investment firms?

Information barriers within the firm (interdepartmental, review employee trading)

How should m/c vote proxies?

Informed and responsible manner

Who does GIPS apply to?

Investment management firms and their clients/prospects

What is a discretionary fund?

Investment manager actively manages the fund

When is m/c responsible for violations others committed?

Knowingly participate or assist

What is the applicable law?

Law that governs the m/c conduct

What is required for Standard III(A) Loyalty, Prudence, and Care?

M/c act in their clients' best interests and recommend products that are suitable given their clients' investment objectives and risk tolerances

When does Standard I(A) apply?

M/c know or should know that their conduct may contribute to a violation of applicable laws, rules, or regs of Code & Standards

What must members and candidates do when responsible for managing a portfolio to a specific mandate, strategy, or style?

Make only investment recommendations or take only investment actions consistent with the stated objectives and constraints of the portfolio

What must m/c in supervisory roles do?

Make reasonable efforts to ensure that anyone subject to their supervision complies and prevent them from doing so with applicable laws, rules, regulations, and the Code and Standards

What is a suitability standard?

Match client return requirements and risk tolerances and characteristics of the securities recommended

What is mezzanine financing?

Mostly convertible debt structures. Combined financing through use of both debt & equity.

What is required of m/c for brief presentations?

Must make detailed info available upon request and indicate that presentation only includes limited info

Are m/c allowed to imply or state ability to achieve a rate of return similar to that achieved in the past?

NO

Are the requirements of the Preservation of Confidentiality intended to prevent members and candidates from cooperating with a CFA PCP investigation?

NO!

Is Standard IV(A) Loyalty (Duties to Employers) applicable to independent contractors as well as employees?

NO! Contractors abide by their contract.

Should the firm know performance first or which composite each portfolio is included in?

Need to know which composite each portfolio is included in

When do client's interests not come first?

Never

What are issues that could be in a proxy statement?

New board of directors, compensation of executives, and declarations made my management

Does the Standard require the m/c to be an expert of laws that govern their profession?

No

Can you disclose illegal activity committed by a client if the law prohibits doing so?

No and you wouldn't be breaking any standard because you're following the stricter of the law or standard (Knowledge of the Law Standard)

Is it appropriate to prohibit all proprietary trading when a firm is in possession of non-public info?

No because it may send a signal to the market. Firms should only take OPPOSITE side of unsolicited customer trades.

Do candidates have to abide by CFA Member Agreement?

No but must follow CFA rules

When is it okay for a m/c to omit the names of individuals?

No longer with firm but cannot claim credit for their work either

Is the m/c required to put employer interest ahead of family and other personal obligations?

No! Only professional obligations. M/c is expected to balance these obligations with work.

Is everything in GIPS required?

No, some is just recommended

Is compliance with GIPS mandatory?

No- it is voluntary

Does fairly mean equally?

No. In normal course of business there is differences in the time emails, faxes, or other communications occur.

May a m/c discriminate against any clients when disseminating recommendations or taking investment action?

No. Never.

How can firms comply with Loyalty to Employers?

Not have incentive and compensation systems that encourage unethical behavior

Must m/c vote on all client proxies?

Not necessary if due to cost-benefit restraints (such a small # of shares owned, or the proxy is to vote on something that wouldn't impact price)

Fiduciary duty/standard

Obligation to deliver high standard of care when acting for the benefit of another party

What is an example of a blackout period?

Once investment decision has been made or is being considered, employee cannot purchase/front-run client.

Does the Code and Standards require m/c to report violations to government or regulatory agencies?

Only if required by law

What are soft commissions?

Payment of higher brokerage commissions to purchase of goods/services that don't benefit client

What are soft dollars?

Payment on behalf of the m/c for services they would pay for otherwise but are not responsibility of client to pay (i.e. training seminars)

What does The Handbook address?

Professional intersection where theory meets practice. Ethics crosses from abstract to concrete.

When can employee's loyalty to employer be broken?

Protect client or market integrity, not personal gain

Standards of Practice Handbook (Handbook)

Provides guidance to people who grapple with real ethical dilemmas in investment profession

What does reporting performance on a composite do for the client?

Provides info about the firm's success in managing various types of securities or results from investment styles

When does a m/c not have to credit sources?

Publicly recognized financial & statistical reporting services i.e. "yahoo finance" or "SEC.gov/edgar"

What is the mosaic theory?

Reaching an investment conclusion through perceptive analysis of public info combined with non-material nonpublic info is not a violation of the standard (small pieces of both, a mosaic)

What should m/c do regarding Distribution Area Laws?

Reasonable effort to understand the applicable laws for the countries and regions where their investment products are developed and distributed to clients

What is third party research?

Research conducted outside the firm

What must be done in the event of a violation by subordinates of a m/c?

Respond promptly and conduct a thorough investigation while stopping the activities

What is "cornering"?

Securing a controlling position in a financial asset to exploit price of a related derivative

What is the representative account issue?

Showing a top-performing portfolio as representative of the firm's results

What is varying time periods issue?

Showing performance for selected time periods with outstanding returns

Profession

Specialized skills and knowledge who serve others and agree to behave in accordance w/ a code of ethics

What is a proxy statement?

Statement to shareholders with information required by the SEC about matters that will be brought up at stockholder meetings

How should a firm handle private placements that employees might engage in?

Strict limits on employee acquisition of private placement securities and proper supervisory procedures in place

How can m/c comply with Loyalty, Prudence, and Care?

Submit to clients, at least quarterly, itemized statements showing all securities in custody and all transactions

What do most professions emphasize?

-Ethical approach -Importance of good service -Empathy with the client

Who is The Handbook intended for?

-Global audience -CFA institute members -Supervisors and direct/indirect reports determining responsibilities to each other, client, and market -CFA institute candidates

What separates professions from tradespeople?

-Licensed status and technical standards -Serve society

What is the Disciplinary Review Commitee (DRC)?

-Responsible for enforcement of the Code and Standards -Volunteers, all CFA charterholders -Reviews decisions of Professional Conduct staff if member/candidate disagrees

Code of ethics

-Written principles -Groups codification of beliefs about obligatory and forbidden conduct

What are factors for complying with GIPS?

1. Input data 2. Calculation methdology 3. Composite construction 4. Disclosures 5. Presentation and reporting 6. Real estate 7. Private equity 8. Wrap Fee/Separately Managed Account (SMA) Portfolios

What are the sub-standards of Professionalism?

1. Knowledge of the Law 2. Independence & Objectivity 3. Misrepresentation 4. Misconduct

How can members comply with Diligence and Reasonable Basis?

1. Review assumptions 2. Determine how rigorous analysis was 3. Identify how timely the research is 4. Evaluate objectivity and independence of recommendations

What is the SPC ensuring of Code and Standards?

1. Representative of high standards of professional conduct 2. Relevant to changing nature of profession 3. Globally applicable 4. Sufficiently comprehensive, practical, specific 5. Enforceable 6. Testable for CFA program

What is the CFA Code of Ethics?

1. Act w/ integrity, competence, diligence, respect for all 2. Place integrity of investment profession above their own interests 3. Use reasonable care & independent judgment for investing 4. Practice & encourage others to practice in a prof. & ethicla manner to reflect credit on themselves & profession 5. Promote integrity & viability of global cap. mkts for ultimate benefit of society 6. Maintain & improve prof. competence, encourage others

What is required for the definition of the firm?

1. Apply GIPS firm-wide 2. Total firm assets includes market value of discretionary, non-discretionary assets, fee paying and non-fee paying 3. Include performance of sub-advisors if firm has discretion over sub-advisor 4. Cannot change historical performance even if change in org

How should m/c comply with Standard VI(B) Priority of Transactions?

1. Avoid conflicts that arise with IPOs by not participating in them 2. Encourage their firms to adopt procedures for priority of transactions

How can m/c comply with Preservation of Confidentiality?

1. Avoid disclosing info received from a client except to authorized coworkers who are also working on client (need to know basis) 2. Follow firm procedures for storage of electronic data and recommend adoption of such procedures if they are not in place

What should an adequate compliance procedure for the code of ethics include?

1. Be clearly written 2. Easy to understand 4. Designate a compliance officer w/ authority clearly defined 5. Have a system of checks/balances 6. Outline scope of procedures 7. Outline conduct permitted

What is the difference between a gift and additional compensation?

1. Bonus for future performance of account, additional comp 2. Bonus for past performance, gift required to follow under Standard I(B) Independence and Objectivity

What should steps to disassociate be?

1. Bring to attention of employer 2. Disassociate/step-away

What are the fundamentals issues of complying with GIPS?

1. Definition of the firm 2. Documentation of policies and procedures with respect to GIPS compliance 3. Complying w/ GIPS updates 4. Claiming compliance appropriately 5. Appropriate verification standard

What is recommended to comply with Standard I(D) Misconduct?

1. Develop and adopt a code of ethics 2. Make clear unethical behavior will not be tolerated 3. Give employees list of potential violations and sanctions, including dismissal 4. Check references of potential employees

What are recommended compliance procedures for firms with Knowledge of the Law standard?

1. Develop/adopt code of ethics 2. Provide info on applicable laws 3. Establish procedures for reporting violations

What should a m/c supervisor do once a compliance program for the code of ethics is instituted?

1. Distribute to proper personnel 2. Update as needed 3. Continually educate staff 4. Issue reminders 5. Require professional conduct evaluations 6. Review employee actions for compliance/violations

How can firms comply with Responsibilities of Supervisors?

1. Do not co-mingle compliance with firms code of ethics as it dilutes it 2. During investigations, limit employees activities

What are reporting procedures that can be set up regarding priority of transactions by firms?

1. Duplicate trade confirmations 2. Disclosure of personal holdings 3. Beneficial ownership positions 4. Preclearance procedures

How can m/c comply with Performance Presentation?

1. Encourage firms to adhere to GIPS 2. Consider sophistication of audience at presentation 3. Present performance of composite of portfolios rather than performance of a single account 4. Include terminated accounts as part of historical performance & clearly state they were terminated 5. Include all appropriate disclosures to explain results 6. Maintain data and records used to calculate performance being presented

How can m/c comply with Responsibilities of Supervisors?

1. Encourage firms to adopt a code of ethics and provide code of ethics to clients

How can m/c comply with Standard IV(C) Referral Fees?

1. Encourage firms to adopt clear procedures regarding compensation for referrals 2. Provide their employers with updates at least quarterly

What should m/c do to comply with Fair Dealing?

1. Encourage firms to establish compliance proceures requiring proper dissemination of investment recommendations/fair treatment 2. Maintain list of clients and holdings & use to ensure holders are treated fairly

How should firms comply with Standard VI(B) Priority of Transactions?

1. Establish limits on employee participation in IPOs 2. Establish restriction on participation in private placements 3. Establish blackout/restricted periods 4. Establish reporting procedures

How can firms comply with Loyalty, Prudence, and Care?

1. Follow all rules and laws 2. Establish investment objectives of clients 3. Consider suitability of a portfolio relative to the client's needs & circumstances 4. Diversify 5. Deal fairly with all clients in regard to investment actions 6. Disclose conflicts 7. Disclose comp. agreements 8. Vote proxies in best interest of clients & beneficiaries 9. Maintain confidentiality 10. Seek best execution

How can member comply with Loyalty to Employers?

1. Give Employer a copy of the Code and the Standards 2. Use separate social media accounts for personal and professional communications (Facebook vs LinkedIn)

What are widely acknowledged fundamental ethical principles?

1. Honesty 2. Fairness 3. Diligence 4. Care and respect for others

What is the ethical decision making framework?

1. Identify (facts, stakeholders, duties, conflicts, etc) 2. Consider (influences, actions, guidance) 3. Reflect (was the outcome anticipated)?

When does a m/c not have to keep info about current, former, and future clients confidential?

1. Information concerns illegal activities by the client 2. Disclosure is required by law 3. Client or prospective client permits disclosure of info

What are the 2 forms of market manipulation?

1. Information-based manipulation 2. Transaction-based manipulation

What should firms do to comply with Fair Dealing?

1. Limit # of people who are aware change in recommendation will be made 2. Shorten time b/n decision & dissemination 3. Publish personnel guidelines for dissemination- prohibit those w/ knowledge from discussion or taking action prior to recommendation 4. Disseminate new or changed recommendations simultaneously (for all who it is suitable or express interest) 5. Develop written trade allocation procedures to ensure fairness, efficiency, and accuracy 6. Disclose trade allocation procedures 7. Establish systematic account review 8. Disclose all available levels of service

What are the 6 areas of the Asset Manager Code of Professional Conduct?

1. Loyalty to clients 2. Investment process 3. Trading 4. Complince 5. Performance evaluation 6. Disclosure

How can members comply with Standard V(B) Communication with Clients and Prospective Clients?

1. Maintain records indicating nature of research 2. Supply additional info if requested by client 3. Research review process 4. Make sure research is DEFENSIBLE

How can members comply with Additional Compensation Arrangement Standard?

1. Make immediate written report to employer for any proposed compensation and services 2. Part-time workers should discuss arrangements that may compete with employer's interest and abide by limitations set

What is recommended to comply with Standard II(A) Material Nonpublic Information?

1. Make reasonable efforts to achieve public dissemination by firm of info they possess 2. Encourage their firms to adopt procedures to prevent the misuse of material nonpublic info 3. Exercise substantial control of relevant interdepartmental communications through a clear area such as compliance 4. Review employee trades 5. Maintain "watch", "restricted", and "rumor" lists

What must members and candidates in an advisory relationship with a client do?

1. Make reasonable inquiry into client/prospect's investment experience, risk and return objectives, and financial constraints prior to making ANY recommendations/taking any action 2. Must reassess info in step 1 regularly 3. Determine that an investment is suitable for a client's situation & consistent with objectives before making recommendation or investment action

What changed in the 11th edition of The Handbook?

1. Mission (betterment of society) 2. Capital markets principle (betterment of society) 3. Responsibilities of Supervisors (increased compliance expectations) 4. Communicate w/ clients and prospects (implicit requirement to discuss risks and limitations) (disclosures change) 5. CIPM Program/CFA Investment Foundations certificate (expands to "participants")

What must a firm do when claiming complying w/ GIPS?

1. Must use standard compliance statement 2. No partial compliance 3. No statements in reference to calculation methodologies 4. No statements referring to one individual or fund as in compliance

How do professions establish trust?

1. Normalize practitioner behavior 2. Provide a service to society 3. Client focused 4. High entry standards 5. Possess body of expert knowledge 6. Encourage and facilitate continuing education 7. Monitor professional conduct 8 Collegial 9. Recognized oversight bodies 10. Encourage engagement of members

What can a m/c not to do their employer?

1. Not act for their benefit 2. Deprive employer of your skills or abilities 3. Divulge confidential information 4. Cause harm to employer

What do the private equity investment valuation standards not have to be followed?

1. Open-end fund 2. Evergreen fund

How can firms comply with Diligence and Reasonable Basis?

1. Policy requiring basis for decisions that can be substantiated 2. Detailed, written guidance on proper research and due diligence 3. Measurable criteria for judging quality of research, and base analyst comp on such 4. Written procedures that provide minimum level of scenario testing, standards for the scenarios, and measurement of cash flow sensitivity 5. Policy for evaluating outside providers of information for reasonableness and accuracy and how often to evaluate 6. Adopt standards of criteria for evaluating external how often to evaluate

What is recommended to comply with Standard I(C) Misrepresentation?

1. Prepare summary of experience, qualifications, and services m/c can perform 2. Encourage employers to verify marketing materials provided by 3rd parties concerning their abilities/products/services 3. Cite source of materials, even summaries 4. Keep copies of all materials used in prep of research 5. Provide a list, in writing, of firm's services and qualifications 6. Review docs and communications of m/c for any misrepresentation of employee or firm capabilities 7. Plagiarism policy

What are the CFA Standards of Professional Conduct?

1. Professionalism 2. Integrity of Capital Markets 3. Duties to clients 4. Duties to employers 5. Investment analysis, recommendations, and actions 6. Conflicts of interest 7. Responsibilities as CFA m/c

What are recommended procedures for firms to comply with independence and objectivity?

1. Protect the integrity of opinions 2. Create a restricted list 3. Restrict special cost arrangements 4. Limit gifts 5. Restrict investments 6. Implement review procedures 7. Independence policy 8. Appoint officer with oversight responsibilities

What must firm's do to comply with GIPS?

1. Provide compliant presentation to ALL prospects 2. Provide composite list & composite description 3. When requested, provide compliant presentation and composite description for any composite on the firm's list 4. When jointly marketing, make it clear which firms comply 5. Be aware of updates, guidance statements, and the like

What are recommendations for verifications?

1. Pursue independent verification on firm-wide basis 2. Verified firms should include a disclosure of the verification reports

How can m/c comply with Suitability?

1. Put needs, circumstances, and objectives into written IPS for each client 2. Consider type of client (beneficiaries vs mandate, objectives, constraints, performance benchmarks) 3. Review investor's objectives and constraints periodically to reflect any changes in client circumstances

What were misleading practices of reporting investment performance?

1. Representative accounts 2. Survivorship bias 3. Varying time periods

What are the fundamentals of compliance with GIPS?

1. Requirements 2. Recommendations

What is an Investment Policy Statement (IPS)?

A gathering of client information at the beginning of the relationship that considers clients needs, circumstances, and risk tolerance. Considers whether to use leverage for client.

What is a composite?

A grouping of individual DISCRETIONARY portfolios representing similar investment strategy, mandate, or objective

How should the m/c exercise prudence, care, skill, and diligence?

A person acting in a like capacity and familiar with such matters would use

What is Global Investment Performance Standards (GIPS)?

A set of ethical principles based on a standardized, industry-wide approach

Ethics

A set of moral principles and rules of conduct that provide guidance for our behavior

Who performs verification that investment performance is in compliance with GIPS?

A third party performs on a firm-wide basis

How should m/c manage pools of client assets?

According to terms of governing documents, such as trust documents or investment management agreements

How must private equity investments be valued?

According to the GIPS Private Equity Valuation Principles

What conflicts of interest must be disclosed?

All ACTUAL and POTENTIAL conflicts with clients, prospective clients, or employer (independence & objectivity)

What must a composite include?

All fee-paying, discretionary portfolios, current and past, managed with that strategy

What investments fall into private equity investments?

All investments not publicly traded regardless of their stage of business development

What is capacity in terms of portfolio/investment management?

An investment vehicle's ability to absorb additional investment without reducing the returns it is able to achieve

How are composite returns weighted?

Asset-weighted

What must the 3rd party verifier do?

Attest to: 1. Firm has complied with all GIPS requirements for composite construction on a firm-wide basis 2. Firm's processes and procedures are established to present performance with calculation methodology, data requirements, and format required by GIPS

Moral/ethical principles

Beliefs about what is good, acceptable, obligatory, and what is bad, unacceptable, or forbidden

Standards of conduct

Benchmarks for minimally acceptable behavior- clarifies code of ethics

Do moral/ethical principles pertain to yourself or others?

Both

What is difference between CFA Code and Standards and the Asset Manager Code of Professional Conduct?

CFA: Members or candidates Asset manager: Firms specifically

What should the client be aware of before an order for a security is accepted?

Change in recommendation of a security

Should m/c place client or employer interests first?

Client because that effects firm integrity and sustainability

What is secondary research?

Conducted by someone else in the firm

What is definition of a firm or purposes of GIPS compliance?

Corporation, subsidiary, or division that is held out to clients as a business entity

What are wash trades?

Creating fake activity through the use of multiple portfolios

How firms comply with Additional Compensation Arrangement Standard?

Details of additional comp by employees should be verified with other party by employers

For Standard IV(B) Additional Compensation Arrangements, what does comp include?

Direct and indirect compensation from client and other benefits from received from third parties

How should m/c comply with Standard VI(A) Disclosures of Interest?

Disclose any and all compensation agreements that could conflict with employer or client

What is strongly encouraged of members by The Handbook?

Discuss w/ supervisors, legal, and compliance departments the content of the Code and the Standards and the members' general obligations under such

How should the m/c respond to a clients request to purchase an investment the m/c knows is unsuitable?

Do not purchase until having discussed all reasons with client that he trade is not suitable for the client: 1. If the risk/return to overall portfolio is minimal, may follow firm policy is client acknowledges lack of suitability. 2. If the risk/return to overall portfolio is material, either update IPS, open client-directed account, or reconsider keeping client.

What should m/c do regarding dissociation?

Document the violation and their attempts to persuade the perpetrators to cease such conduct

What is required for document policies and procedures for GIPS?

Document, in writing, policies and procedures the firm uses to comply with GIPS

What is market manipulation?

Engaging in practices that distort prices or artificially inflate trading volume with the intent to mislead market participants

What should m/c keep in mind when leaving a firm in regard to social media?

Ensuring social media use complies with employers' policies for notifying clients about employee separations

What is survivorship bias?

Excluding "weak performance" accounts that been terminated

Situational influences

External factors that shape our thinking, decision making, and behavior

What is most likely to make people act unethically?

External factors, environmental or cultural elements

How are total assets presented in a GIPS presentation?

Fair value

What must m/c ensure regarding their performance presentation/information?

Fairness, accuracy, completion

How to compare fiduciary standard with suitability standard?

Fiduciary is stronger than suitability, requiring proessionals use their know and expertise to act in the BEST INTEREST of clients

What happens after 5 years of compliant data is presented?****

Firm must add annual performance each year going forward up to a minimum of 10 years

What to do when local country law conflicts with GIPS?

Follow country law but disclose conflict in presentation

What should CFA do when 2 laws (or the code) conflict?

Follow more strict law/code

When a law or regulation conflicts with GIPS what should m/c do?

Follow the law but disclose the conflict in the composite

Can a firm present performance in compliance with a Country Version of GIPS (CVG)?

For periods prior to January 1, 2006 and include until minimum of 10 years presented

What is the Asset Manager Code of Professional Conduct?

Help asset managers comply with regulations mandating codes of ethics for investment advisers

How can firms comply with Standard IV(C) Referral Fees?

If firm doesn't prohibit referral fees, they should have clear procedures for approval and policies regarding nature/value of comp received

Does the m/c have a requirement to report illegal activities by a client?****

If required by law

What is the role of SPC members at their respective firms?

Important supervisory responsibilities (typically)

How should m/c make investment decisions?

In context of the overall portfolio

What is recommended for definition of the firm?

Include broadest definition of the firm, including geographical offices marketed under the same name

In most cases, who does the recordkeeping requirement fall upon?

The firm rather than the employee. The employee might be held accountable to the firm's ultimate requirement.

When is a transaction considered personal to the m/c?

The m/c is the beneficial owner

What is the purpose of GIPS?

To avoid misrepresentations of performance

What is practice analysis?

Updating Global Body of Investment Knowledge (GBIK) and Candidate Body of Knowledge (CBOK)

When is the verification report available?

Upon request

What is the CFA Institute Standards of Practice Council (SPC)?

Volunteers (all CFAs) from many different countries, charged with maintaining/ensuring Code and Standards are effective

Can a m/c accept additional comp from someone that would create a conflict of interest with their employer?

With written consent from all parties involved

When must a prospect have received a presentation prior to signing with GIPS?

Within the last 12 months

Is it the m/c responsibility to take reasonable action to avoid conflicts of interest?

YES

Does Preservation of Confidentiality apply to former clients too?

YES!

Can disassociate include leaving employer?

Yes

Does written consent from an employer constitute email communication?

Yes

Must the m/c inform clients of any limitations in an advisory relationship?

Yes

Must you disclose all different levels of services available to clients and prospects?

Yes

Must you offer premium services to all clients willing to pay for them?

Yes

Is m/c allowed to practice independently while working for an employer?

Yes if all info of services provided to employer and employer consents to practice BEFORE it begins

Can firms presents periods of noncompliant performance immediately preceding the year of compliant performance?

Yes if presented for any years prior to 1/1/00

Should a m/c seek legal counsel?

Yes!

Would inclusion of broker-dealer market-making activities be included in Standard VI(A) Disclosure of Conflicts?

Yes!

Are different service levels for clients acceptable?

Yes, but cannot negatively affect or disadvantage any clients

Can m/c actions affect security values and trading volumes without violating market manipulation standard?

Yes. Key point is "intend to mislead". For example spreading false info or trying to mislead through trades.

What is the statement regarding compliancew ith CFA Program for nonmembers and firms?

[Name of party] claims compliance with the CFA Institute Code of Ethics and Standards of Professional Conduct. This claim has not been verified by CFA institute.