Which duty requires that clients not be adversely affected by conflicts of interest?

Which duty requires that clients not be adversely affected by conflicts of interest?

• A. Duty of loyalty
• B. Equal treatment of clients
• C. Chronological order
• D. Prohibition of price fraud

Answer: (A)

The main idea is about acting in the client’s best interests and keeping conflicts of interest from harming them. The duty of loyalty is a fiduciary-like obligation that requires the adviser to put the client’s interests ahead of their own or of others and to manage any conflicts transparently. If a conflict could influence the advice given, the adviser must disclose it, obtain the client’s informed consent, or decline the particular arrangement to avoid adverse effects. This is what ensures clients aren’t disadvantaged by conflicts. While equal treatment of clients is related to fairness, it doesn’t specifically address how conflicts are handled in practice. The other options are not about conflicts of interest or the protection of the client in this context.

The main idea is about acting in the client’s best interests and keeping conflicts of interest from harming them. The duty of loyalty is a fiduciary-like obligation that requires the adviser to put the client’s interests ahead of their own or of others and to manage any conflicts transparently. If a conflict could influence the advice given, the adviser must disclose it, obtain the client’s informed consent, or decline the particular arrangement to avoid adverse effects. This is what ensures clients aren’t disadvantaged by conflicts. While equal treatment of clients is related to fairness, it doesn’t specifically address how conflicts are handled in practice. The other options are not about conflicts of interest or the protection of the client in this context.