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IMCA, Ethics and the Broker's Wallet

The Investment Management Consultants Association is aiming to create a structure for rewarding ethical behavior.

The ethics committee of the Investment Management Consultants Association is taking their demands to the top.

The committee has geared a September ethics summit toward top brass at the major brokerage firms. The hope is that the meeting will generate methods for rewarding and promoting ethical behavior by brokers.

The ultimate goal, IMCA executives say, would be a specific compensatory structure for “good” actions, but, failing that, they at least want the meeting to generate some concrete ideas for giving brokers incentives to behave well.

“We're not going to sit around and wax ethical concerns and go our separate ways,” says Julie Updike, chair of IMCA's ethics committee.

Committee members told Registered Rep. at IMCA's late-May conference in Scottsdale, Ariz., that IMCA's interest in promoting ethics predates the research-related scandals on Wall Street, but they did say interest in ethical standards has grown in the wake of those troubling cases.

“If there's one way that the current corporate situation is playing into our hands, it is that people will now listen and say, ‘Okay, there needs to be a safe place for people who are raising these questions, and they need to be addressed when they're raised,’” says Updike.

In the few years since it was started, the IMCA ethics committee has created a number of programs, including a one-hour seminar on ethics that is part of IMCA's continuing education program.

Brian Buckley of Morgan Stanley, a member of the ethics committee, says IMCA's influence is likely to increase as financial advisors seek higher designations and as they handle the various, more complex types of wealth planning that IMCA members focus on.

The greater IMCA organization is made up of members from Wall Street firms and other organizations that are currently applying themselves to investment management consulting, a sophisticated form of wealth management. About 2,300 of the members are actively practicing CIMAs, or Certified Investment Management Associates, and there are 16 full classes of 50 reps enrolled for 2003.

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