Which remedy requires turning all conflicting assets over to an independent manager and must be approved prior to execution?

Which remedy requires turning all conflicting assets over to an independent manager and must be approved prior to execution?

• A. Waiver
• B. Certificate of Divestiture
• C. Blind Trust
• D. Misuse of Position

Answer: (C)

Removing control of the conflicting assets from your hands and placing them under an independent manager is the essence of a blind trust. In a blind trust, all assets that could create a conflict are placed into a trust managed by an impartial trustee, and the beneficiary does not direct or even know the holdings. This separation prevents the individual from making or influencing decisions based on those assets, eliminating the appearance and reality of impropriety. Because such an arrangement can change how assets are controlled and requires careful oversight to ensure it’s set up correctly, it typically must be approved before it can take effect. This differs from other remedies: a waiver simply allows you to proceed despite the conflict without transferring assets; a certificate of divestiture requires selling assets rather than transferring management of them; misuse of position is the misconduct itself, not a corrective measure. The blind trust best satisfies the requirement of turning all conflicting assets over to an independent manager and getting prior approval.

Removing control of the conflicting assets from your hands and placing them under an independent manager is the essence of a blind trust. In a blind trust, all assets that could create a conflict are placed into a trust managed by an impartial trustee, and the beneficiary does not direct or even know the holdings. This separation prevents the individual from making or influencing decisions based on those assets, eliminating the appearance and reality of impropriety. Because such an arrangement can change how assets are controlled and requires careful oversight to ensure it’s set up correctly, it typically must be approved before it can take effect.

This differs from other remedies: a waiver simply allows you to proceed despite the conflict without transferring assets; a certificate of divestiture requires selling assets rather than transferring management of them; misuse of position is the misconduct itself, not a corrective measure. The blind trust best satisfies the requirement of turning all conflicting assets over to an independent manager and getting prior approval.