ASFMRA Best in Business Ethics
Core concepts
Ethics questions test professional conduct, not calculation. Know the core duties: competence (only accept work you are qualified to perform), objectivity and independence, confidentiality of client information, integrity and avoidance of conflicts of interest, and full disclosure of any interest that could bias an opinion. Understand the distinction between advocacy (acceptable within limits when representing a client's position) and misrepresentation (never acceptable). Appraisers and managers must not accept contingent fees tied to a predetermined value or outcome, must document the basis for opinions, and must correct errors promptly. Respect for the public interest and compliance with applicable laws and standards are baseline expectations.
Traps
The most common trap is the contingent-fee scenario: a client offers a bonus if the value hits a target. The right answer is to decline the contingency while remaining willing to do the unbiased work. Another trap is confidentiality versus legal obligation-confidentiality does not shield illegal conduct or a court-ordered disclosure. Watch for questions where a colleague asks you to sign off on work you did not perform or cannot verify; the ethical response is to decline and document. Conflicts of interest must be disclosed, not merely avoided silently.
Worked example
A lender pressures you to raise an opinion to support a loan. Rule of thumb: the value must be supported by evidence regardless of who wants what. Disclose the pressure, document your analysis, and deliver the supportable opinion. If the relationship cannot continue objectively, withdraw and say why in writing.