Arbaaz, an AIMR member, works for an investment advisory firm, Leon Investments. His friend, Shahzad, recently asked him for some investment recommendations. Arbaaz analyzed Shahzad's portfolio over a weekend and suggested some changes. While he did not accept any remuneration, Shahzad promised him some gifts if his portfolio "performed well." Arbaaz did not inform his employer since he thought he was helping a friend and in any case, the
Shahzad's account was extremely small and there were no financial payments. Arbaaz has:
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A. B. C. D.A
While Arbaaz did not receive any monetary compensation, there is a possibility of gifts in the future. Standard III (B) applies even when there is no actual receipt of compensation; what is important is the possibility of future payments in cash or kind. By not obtaining a written permission from his employer before advising
Shahzad, Arbaaz violated Standard III (B).