QUESTIONS 1 THROUGH 18 RELATE TO ETHICAL AND PROFESSIONAL STANDARDS.

14. Sheila Schleif, CFA, is an equity analyst at an investment banking division of Mokara Financial

Group, a full service financial group. Schleif uses a multi-factor computer model to make stock

recommendations for all clients of Mokara. Schleif discovers the model contains an error. If the

error were corrected, her most recent buy recommendation communicated to all clients would

change to a sell. Schleif corrects the error, changing the buy to a sell recommendation, and then

simultaneously distributes via e-mail the revision to all investment banking clients who received

the initial recommendation. A week later, Schleif sells the same shares she held in her personal

portfolio. Concerning her actions, Schleif most likely violated which of the following CFA

Institute Standards of Professional Conduct?

A. Fair Dealing

B. Priority of Transactions

C. Diligence and Reasonable Basis