Explanation

Julian Johnson has not violated the Standard relating to preservation of confidentiality for the following reasons:

Key Standards Analysis:

• Standard III(E): Preservation of Confidentiality requires members to maintain confidentiality of client information, except when:
  1. The information concerns illegal activities
  2. Disclosure is required by law
  3. The client or prospective client permits disclosure

Application to the Scenario:

1. Securities Regulator Request: Johnson properly disclosed information to the securities regulator investigating suspected illegal market activities. This falls under the "illegal activities" exception.

2. Tax Authority Request: Johnson also properly disclosed information to the tax authority investigating tax fraud. Tax fraud constitutes illegal activities, making disclosure permissible under the Standards.

3. Client's Request: Smith's request not to disclose information came after Johnson had already properly disclosed to the securities regulator. The subsequent request does not retroactively create a violation.

Important Note:

The Standards permit disclosure when information concerns illegal activities, and both securities violations and tax fraud qualify as illegal activities requiring disclosure to proper authorities.

Therefore, Johnson acted appropriately in both instances and did not violate confidentiality standards.