QUESTIONS 1 THROUGH 18 RELATE TO ETHICAL AND PROFESSIONAL STANDARDS.

16. Jimmy Lee, CFA, is an investment banker in a country with strict confidentiality

laws. He is working on an acquisition for Panda Mining Co. (PMC). While

performing due diligence, Lee notices that PMC has a number of questionable

offshore partnerships. He investigates the legality of the partnerships and finds

evidence of illegal activity. According to the Standards of Professional Conduct,

Lee’s best course of action would be to:

A. alert CFA Institute.

B. consult outside counsel.

C. notify regulatory authorities.