The stunning developments come just weeks after Goldfarb and Keller made joint presentations at the annual FPA national conference in San Antonio and talked about the organization’s future plans, and two months after Ron Rhoades, the chairman-elect of NAPFA, stepped aside following a compliance violation at this firm. (Rhoades, who received a letter of noncompliance from Florida regulators, was not fined and won approval to continue working as an investment advisor.)
The CFP Board said chairwoman-elect Nancy Kistner, a CFP who is a wealth planning director at US Trust, was elected by the board to fill the remainder of Goldfarb’s term and will continue to chair the board through Dec. 31, 2013.
“I am certain that this was a misunderstanding and I welcome the opportunity to engage in good faith the CFP Board’s enforcement process,” Goldfarb said in a statement released by the board. “It is my responsibility to put the interests of the organization ahead of my own. I believe that, under the circumstances, it is best for the organization that I resign pending the outcome of the process as both chair and a member of the Board of Directors, effective immediately.”
Details on the alleged violations were not disclosed, nor were the names of the two members of the disciplinary and ethics commission who also stepped down.
In an email, Keller told Financial Planning: “While proceedings under CFP Board’s disciplinary rules and procedures are confidential and, because of that confidentiality provision, [we] cannot disclose details related to allegations against CFP professionals, I think it is important to clarify that the matter announced today does not involve alleged violations of criminal or civil laws.”
Keller added that disciplinary proceedings that result in a public sanction are made public once the process is complete. Goldfarb did not respond to a phone call or email seeking further comment.
Goldfarb, who is also director of wealth management at Weaver Wealth Management in Dallas, has been a leading voice in the industry on the importance of mentoring young planners, and was chosen as an Influencer Award winner last year by Financial Planning for that work.
Without disclosing the circumstances, the CFP Board said it “became aware of broad allegations” involving Goldfarb and the two others and created a special committee made up of public board members who have no ties to the financial services industry.” It added that the special committee retained outside counsel to investigate and reported its findings directly to the committee.
“The committee found sufficient merit in the allegations against Mr. Goldfarb and the two members of the disciplinary and ethics commission to refer them for further proceedings under CFP Board’s Disciplinary Rules and Procedures. When presented with the committee’s findings, they decided to resign from their positions,” the board said.
Kistner emailed a letter to CFP Board members on Friday, saying, “I want to assure you that CFP Board takes all allegations of violations of our Standards of Professional Conduct very seriously. That is why the board of directors put in place a very careful and deliberative process to address allegations made against members of the board and other volunteer leaders. The board’s strong and proactive response, as outlined in our statement, demonstrates our unwavering commitment to uphold the integrity of the CFP certification and to rigorously enforce compliance with our standards by all CFP professionals.”
She added: “Under my leadership, the board of directors will remain focused on advancing the organization’s mission – to benefit the public by granting the CFP certification and upholding it as the recognized standard of excellence for personal financial planning.”
Kistner, who is a managing director in the Wealth Planning Solutions department at U.S. Trust, which is part of the Bank of America Private Wealth Management in New York, also serves on the board of the Coalition for Debtor Education through Fordham Law School.
She previously served as director and head of financial planning at Citi Private Bank, and as head of financial planning training at MetLife Financial Services. She could not immediately be reached for comment Friday.