Question

Simon Layman is a trust investment officer at a bank in a small affluent town. He enjoys lunching every day with friends at the country club, where his clients have observed him having numerous drinks. Back at work after lunch, he clearly becomes somewhat intoxicated because of his drinking habits and has affected his investment decision-making. His colleagues make a point that Simon handles business with his client in the morning because they distrust his judgment after lunch.

Based on the above scenario, discuss on Simon’s professional conduct and the impact on his employer and investment industry in general by applying the CFA Standards of Practice Handbook.

Answer 1

Any one in a responsible position like that of a trust investment officer handling other people finances must be of sound nature. He/she must be within his/her senses during working hours and beyond. If Simon is having lunch and drink everyday and is getting noticed by his clients as well, then this habit brings bad repute to the employer. Any lesser than expected returns in future can be blamed on Simon's drinking habits. The employer can also get sued by clients for letting an unstable person handle their investments. This is a serious breach in conduct and can jeopardize the reputation of the employer as well. Drinking during working hours is also an unprofessional behavior and breaches all standards of investment practices. The employer need to immediately issue a show cause notice to Simon before taking necessary actions.