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Answer: encourage L2M to disseminate information about the new technology to the public.
## Explanation According to CFA Institute Standard II(A): Material Nonpublic Information, when members and candidates possess material nonpublic information, they must not act or cause others to act on the information. In this scenario: - Material nonpublic information was disclosed during a conference call - Patterson should encourage the company (L2M) to make the information public - Option B is incorrect because Patterson's firm should not issue a press release on behalf of L2M - Option C is incorrect because the information has already been disclosed to conference attendees, so confidentiality cannot be preserved The most appropriate action is to encourage the company to disseminate the information publicly to ensure fair disclosure to all market participants.
Author: LeetQuiz Editorial Team
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Sam Patterson, CFA, hosts a conference call about the auto industry on behalf of his investment firm. The call is held for a small number of clients. Aditya Rao, the CFO of L2 Motors (L2M), an electric car manufacturer, is a featured guest. In response to a question during the call, Rao mentions a recent major advance in L2M's battery technology not previously disclosed to the public. Patterson determines the information is material.
According to the Standards, Patterson should:
A
encourage L2M to disseminate information about the new technology to the public.
B
promptly issue a press release on behalf of his firm to make the information about the new technology publicly available.
C
immediately have conference attendees sign a nondisclosure agreement to preserve confidentiality of the information.
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