Lesson 4 of 4 · All lessons in this module
This lesson is part of the 2027 curriculum. You are following the 2026 curriculum, where it is not taught in this form. Switch if you are sitting the exam under the 2027 curriculum.
Lesson 4 of 4 · 11 min
Standard VI cases: what is new in 2027
The 2027 text adds a duty to mitigate a conflict and explain how, removes the materiality limit on conveying information about client transactions, and names clients as well as the employer in the reciprocal-referral case.
In short
- VI(A): when a conflict cannot reasonably be avoided, disclose it, seek to mitigate it to the extent possible and disclose how it was mitigated.
- VI(B): members are prohibited from benefiting from or conveying information about client transactions. The 2027 wording has no materiality condition; the 2026 text barred conveying nonpublic information to anyone if it could be deemed material.
- VI(B) practices are framed as duties: members must comply with the employer's personal-investing policies, including holdings reports, duplicate confirmations and preclearance.
- A beneficial owner is someone who ultimately owns, controls, has the power to direct or has a material interest in a security.
- VI(C): in the reciprocal-commission case the member failed to inform both her employer and the referred clients.
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