Explanation:
The Global Association of Risk Professionals (GARP) has a Code of Conduct that its members are expected to adhere to. This Code of Conduct is a set of ethical guidelines that governs the behavior of GARP members in their professional activities. Violation of this Code can lead to serious consequences. One such consequence, as stated in the Code, is the withdrawal of the GARP member's right to use the FRM (Financial Risk Manager) designation for any purpose. This means that the member would no longer be able to refer to themselves as a FRM, which is a significant professional designation in the field of risk management. This consequence is intended to uphold the integrity of the FRM designation and to deter members from violating the Code of Conduct. It is a severe penalty that reflects the seriousness with which GARP views violations of its Code of Conduct.
Choice A is incorrect. While ethical training could be a potential consequence, it is not mandatory according to the GARP Code of Conduct. The code does not explicitly state that members who violate the code must participate in ethical training.
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Q.272 A formal investigation that confirms violation of the GARP Code of Conduct can bring about serious consequences. Which of the following is a potential consequence of such a violation?
A
Mandatory participation in ethical training.
B
A temporary suspension of the GARP member's right to work in the field of risk management.
C
Withdrawal of the GARP member's right to use the FRM designation for any purpose.
D
A formal request to the GARP member's employer to withdraw certain benefits such as bonuses and other fringe benefits.
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