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Answer: both to loyalty and to preservation of confidentiality.
## Explanation Ritu Jain has violated **both** the Standard relating to loyalty and the Standard relating to preservation of confidentiality: ### 1. **Violation of Standard IV(A) - Loyalty to Employer** - Jain disclosed negative information about her current employer (lack of confidence in firm's leadership) to clients - This action undermines her employer's reputation and could harm the firm's business - While employees can leave for better opportunities, they should not disparage their current employer during the transition ### 2. **Violation of Standard III(E) - Preservation of Confidentiality** - Jain disclosed confidential information about potential employee departures ("more employees are likely to leave soon") - This information is likely confidential internal information that should not be shared with clients - Even if true, sharing such information violates her duty to maintain the confidentiality of her employer's affairs ### Key Points: - **Proper conduct**: When leaving a firm, CFA charterholders should: - Notify clients professionally without disparaging the firm - Maintain confidentiality of internal firm matters - Focus on the positive aspects of their new opportunity rather than criticizing the current employer - Follow firm policies regarding client notification during transitions ### Correct Answer: C - both to loyalty and to preservation of confidentiality.
Author: LeetQuiz .
Ritu Jain, CFA, is preparing to leave her firm and join a new employer. Prior to leaving the firm, Jain calls all her clients informing them of her decision to leave. When asked by the clients, Jain states lack of confidence in the firm's leadership as the reason for her departure and also mentions that more employees are likely to leave soon. Jain has violated the Standard(s) relating:
A
only to loyalty.
B
only to preservation of confidentiality.
C
both to loyalty and to preservation of confidentiality.
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