Marketing materials claim "GIPS compliant" without following GIPS procedures. Violation?

• A. Standard IV.D (GIPS)
• B. Standard IV.D Performance Presentation
• C. Standard II.A Material Nonpublic Information
• D. Standard I.B Independence and Objectivity

Answer: (A)

Claiming GIPS compliance when you haven’t followed GIPS procedures is a violation of the standard that governs GIPS and how performance is communicated. GIPS sets the rules for preparing and presenting performance, and a marketing claim of compliance is meaningful only if the firm actually adheres to all the required procedures. Saying you’re GIPS compliant while skipping parts of the process misleads clients and prospective clients about the integrity and comparability of your performance data, which CFA ethics prohibit.

This isn’t about insider information or independence. It’s specifically about the responsibility to present performance truthfully under the GIPS framework, which covers how performance is calculated, aggregated into composites, disclosed, and verified. Misrepresenting compliance erodes trust and violates the obligation to provide accurate and complete information.