CCRM Ethical Practice 5

Question 1

An ethical professional's duty of loyalty primarily runs to:

Accepted Answer

The client and adherence to applicable professional standards

Answer

Duty of loyalty in client relationship management flows first to the client and then to upholding professional ethical standards.

Question 2

What is 'churning' in the context of ethical client management?

Accepted Answer

Excessive transactions in a client account primarily to generate commissions

Answer

Churning is the unethical practice of executing unnecessary transactions to increase commissions at the client's expense.

Question 3

Ethical communication with clients requires that information be presented:

Accepted Answer

Accurately, clearly, and without misleading omissions

Answer

Ethical communication mandates that all information conveyed to clients be accurate, balanced, and free of misleading omissions.

Question 4

A client discloses sensitive personal information during an advisory session. The CCRM should:

Accepted Answer

Keep it strictly confidential and use it only as necessary to serve the client

Answer

Confidentiality requires that personal disclosures be protected and used only in ways that directly serve the client's interests.

Question 5

The concept of 'independent judgment' in ethical practice means:

Accepted Answer

Forming professional conclusions free from undue external influence or bias

Answer

Independent judgment requires that professional conclusions be based on objective analysis rather than pressure from clients, employers, or peers.

(CCRM) Certified Client Relationship Manager Practice Test