When must a CFP® professional disclose conflicts of interest during a client relationship?

A Certified Financial Planner (CFP®) professional is required to disclose conflicts of interest at the initiation of the client relationship, before providing any services. This disclosure is crucial because it ensures that the client is fully aware of any potential biases or interests that could influence the advice provided. By informing clients upfront, the CFP® professional promotes transparency and fosters trust, which are fundamental elements of a successful client-advisor relationship. This practice allows clients to make informed decisions about whether to engage with the CFP® professional's services, aligning with the ethical standards and fiduciary duty expected of financial planners.

Disclosing conflicts at the beginning of the relationship allows clients to weigh any potential conflicts against the advisor's expertise and their professional relationship. Any later disclosures, such as during data collection or upon presenting recommendations, may not provide clients with the same level of opportunity to consider the implications of those conflicts as part of their decision-making process. The timing of the disclosure is therefore integral to the ethical conduct of the CFP® professional.