In a long-running legal battle with the CFP Board, two financial advisers' bid for an appeal in a U.S. District Court is moving forward.
Jeffrey and Kimberly Camarda, who faced disciplinary action by the CFP Board in 2012 for allegedly advertising themselves as fee-only when they were not, had their previous court case dismissed in 2015. They had sought damages against the board for alleged breach of contract and other misconduct.
Now, the Camardas will have a chance to present oral arguments in favor of a public trial before the United States Court of Appeals for the District of Columbia on Sept. 16, according to court documents.
Neither the couple nor their attorney could be reached for immediate comment.
A spokesman for the CFP Board says: "We were pleased with the trial court's decision, which affirmed the integrity of the process by which CFP Board enforces its standards. We look forward to having oral arguments heard by the Court of Appeals."
The source of the lengthy dispute began in February 2011, when the CFP Board began investigating whether the adviser couple had violated the board's policies, according to court documents. The Camardas, who are based in Fleming Island, Fla., own two firms: Camarda Financial Advisors and Camarda Consultants.
At the same time the board began investigating the Camardas, it was allowing nearly 500 wirehouse advisers to call themselves fee only in their marketing profiles on the board's own website, according to a Financial Planning data analysis of planner profiles from a handful of firms on the site three years ago. A subsequent, broader investigation by The Wall Street Journal found 8,122 commission-based advisers engaged in this misrepresentation. The findings prompted critics such as former board officials, including a cofounder of the board's predecessor organization, to accuse the board of holding some of its CFPs to different standards by permitting commission advisers, many from large financial services firms, to use the fee only term to market themselves, while selectively sanctioning others, mainly from smaller firms, for doing the same thing. The board's CEO later said the board had made "a mistake" in allowing the wirehouse advisers to call themselves fee only on its site.
The board moved to take disciplinary action against the Camardas, saying that the advisory firm billed itself as fee-only but had common ownership of Camarda Consultants, which was not fee-only.
After attempting to appeal the disciplinary action through the CFP Board's internal procedures, the couple filed a lawsuit against the board in 2013, according to court documents.
The advisers were longtime holders of the CFP designation; Mr. Camarda had it for 22 years and Ms. Camarda for 14 years, according to court documents. Their advisory firm was founded in 1992 while the consulting firm was founded in 2007.
Though the advisory firm provides fee-only investment advice, Camarda Consultants is a "licensed insurance agency and financial consulting firm providing business planning, tax, estate planning, insurance, and other non-investment-advisory services to its clients for both fees and commissions," the couple said in court documents.
The Camardas maintained in court filings that the firms "were two separate and distinct legally formed and organized entities under Florida law."
In July 2015, U.S. District Judge Richard Leon dismissed the couple's case. "In reviewing a disciplinary action by a private organization, courts do not 'second-guess' the organization's interpretation of its own rules or its evaluation of the evidence," the judge wrote in his decision.
The Camardas filed their appeal in August 2015.
"This road has been long for us and we do not undertake its continuation lightly," the couple said in a statement at the time. "We believe there are grave wrongs to be righted here, with the welfare of the profession, and of the client public, hanging in the balance."