CFA Practice Question

There are 361 practice questions for this study session.

CFA Practice Question

Janet Rodriguez is a senior advisor to several corporations that are clients of her company. She sits on the board of Grassroots Capital. In one of her meetings, she learns that the company had made political donations in excess of the legal limit to support a political campaign to enlist lobbying support for a certain piece of legislation in Congress. What is the appropriate action for Janet?
A. Janet should report the violation to the Election Commission and the SEC.
B. Janet should do nothing as she was not directly involved.
C. Janet should seek immediate objective and competent legal counsel. If any laws were broken, she should encourage the company to report the violation to the proper authorities. If the company fails to do so, she should resign from the board.
Explanation: While Janet is not obligated to report the matter to the authorities under the Code and Standards, she must dissociate herself from violations of the law. After seeking competent and objective legal advice, she must encourage the company to report the violations and remedy the situation. If the board or the company refuses to do so, she should resign from the board.

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