Attached files
EXHIBIT 14.1
Code of Ethics for Principal Executive and Principal Financial
Officers of Capital Financial Holdings, Inc.
This Code of Ethics (the “Code”) for Principal
Executive and Principal Financial Officers has been adopted by
Capital Financial Holdings, Inc., and its subsidiary
(“Company”) to effectuate compliance with Section 406
under the Sarbanes-Oxley Act of 2002 and the rules adopted to
implement Section 406.
This Code applies to Capital Financial Holding’s ("CFH")
principal executive officer, principal financial officer,
controller or persons deemed to be performing similar critical
financial and accounting functions (the “Covered
Officers”).
Purpose of the Code
This Code sets forth standards and procedures that are reasonably
designed to promote:
●
Honest
and ethical conduct, including the ethical handling of actual or
apparent conflicts of interest between personal and professional
relationships;
●
Full,
fair, accurate, timely and understandable disclosure in reports and
documents that a registrant files with, or submits to, the
Securities and Exchange Commission (“SEC”) and in other
public communications made by CFH;
●
Compliance
with applicable laws and governmental rules and
regulations;
●
The
prompt internal reporting of violations of the Code to an
appropriate person or persons identified in the Code;
and
●
Accountability
for adherence to the Code.
In general, the principles that govern honest and ethical conduct,
including the avoidance of conflicts of interest between personal
and professional relationships, reflect, at the minimum: (1) the
duty in performing any responsibilities as a Covered Officer, to
place the interests of CFH ahead of personal interests; (2)
the fundamental standard that Covered Officers should not take
inappropriate advantage of their positions; (3) the duty to assure
that CFH’s financial reports to its shareholders are prepared
honestly and accurately in accordance with applicable rules and
regulations; and (4) the duties performed by the Covered Officer on
behalf of Integrity are conducted in an honest and ethical
manner.
Each Covered Officer should adhere to a high standard of business
ethics and should be sensitive to situations that may give rise to
actual and apparent conflicts of interest.
Compliance with Governmental Laws, Rules and
Regulations
Each Covered Officer shall comply with applicable governmental
laws, rules and regulations, including the rules relating to
disclosure in reports and documents that CFH files with, or
submits to, the SEC. Covered Officers will, at all times,
take all necessary steps to ensure compliance with established
accounting procedures, CFH’s internal controls and generally
accepted accounting principles. Covered Officers will ensure
that CFH makes and keeps books, records, and accounts, which,
in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of CFH. Covered
Officers will also ensure that CFH devises and maintains a
system of internal accounting controls sufficient to provide
reasonable assurances that any attempt to enter inaccurate or
fraudulent information into CFH’s accounting system will not
be tolerated and will result in disciplinary action, up to and
including termination of employment.
Ethical Handling of Actual and Apparent Conflicts of
Interest
A “conflict of interest” occurs when a Covered
Officer’s private interest interferes with the interests of
CFH. Certain conflicts of interest arise out of the relationships
between Covered Officers and CFH. A conflict situation can
arise when an employee, officer or director takes actions or has
interests that may make it difficult to perform his or her work for
the Company objectively and effectively. Conflicts of interest also
arise when an employee, officer or director, or a member of his or
her family, receives improper personal benefits as a result of his
or her position in the Company. This Code does not, and is
not intended to, repeat or replace existing programs and
procedures, and such conflicts fall outside of the parameters of
this Code.
Prohibited Activities
The following list provides examples of conflicts of interest under
the Code, but keep in mind that these examples are not
exhaustive. The foremost principle is that the personal
interest of a Covered Officer should not be placed before the
interest of the Company or its shareholders.
Each Covered Officer must:
■
Not
use his personal influence or personal relationships improperly to
influence investment decisions or financial reporting by CFH
whereby the Covered Officer would benefit personally to the
detriment of CFH or its shareholders;
■
Not
cause CFH to take action, or fail to take action, for the
individual personal benefit of the Covered Officer rather than the
benefit the CFH;
■
Not
intentionally cause CFH to fail to comply with applicable
laws, rules and regulations, including failure to comply with the
requirement of full, fair, accurate, understandable and timely
disclosure in reports and documents that CFH files with, or
submits to, the SEC and in public communications made by
CFH;
■
Not
fail to acknowledge or certify compliance with this Code on an
annual basis.
There are some conflict of interest situations that should always
be discussed with the Compliance Department or, under certain
circumstances, the Board of Directors if material. Examples
of these include:
■
Service
as a director on the board of any public company absent prior
authorization by the Board;
■
The
receipt of any gifts of more than de minimis value, generally gifts
in excess of $100;
■
The
receipt of any entertainment from any company with which CFH
has current or prospective business dealings unless such
entertainment is business related, reasonable in cost, appropriate
as to time and place, and not so frequent as to raise a suggestion
of unethical conduct;
■
Any
ownership interest in, or employment relationship with, any of
CFH’s service providers, other than its investment adviser,
principal underwriter, administrator or any affiliated person
thereof.
Disclosure and Compliance
■
Each
Covered Officer must familiarize himself with the disclosure
requirements generally applicable to CFH;
■
Each
Covered Officer must not knowingly misrepresent, or cause others to
misrepresent, facts about CFH to others, including to
DFH’s directors and auditors, and to governmental regulators
and self-regulatory organizations;
■
Each
Covered Officer should, to the extent appropriate within his area
of responsibility, consult with other officers and employees
of CFH and the adviser with the goal of promoting full, fair,
accurate, timely and understandable disclosure in the reports and
documents CFH files with the SEC and in other public
communications made by CFH; and
■
It
is the responsibility of each Covered Officer to promote compliance
with the standards and restrictions imposed by applicable laws,
rules and regulations.
Reporting and Accountability
Each Covered Officer must:
■
Upon
adoption of the Code or upon becoming a Covered Officer, affirm in
writing to the Board that he has received, read, understands and
will adhere to this Code;
■
Annually
affirm to the Board that he has received and read the Code and that
he understands that he is subject to, and has complied with, the
requirements of the Code;
■
Not
retaliate against any other Covered Officer or any employee
of CFH or their affiliated persons for reports of potential
violations that are made in good faith; and
■
Notify
Compliance, who will then notify CFH’s Audit Committee or
CFH’s legal counsel promptly if he knows of any violation of
this Code or if a potential violation exists. Failure to do
so is itself a violation of this Code.
CFH’s Audit Committee (the ”Committee”) or in
their discretion, CFH’s legal counsel, is responsible for
applying this Code to specific situations in which questions are
presented under it and has the authority to interpret this Code in
any particular situation. Any approvals or waivers sought by
the Principal Executive Officer will be considered by the
Committee. In determining whether to waive any of the provisions of
this Code, the Committee will consider whether the proposed waiver
(1) is prohibited by the Code; (2) is consistent with honest and
ethical conduct; and (3) will result in a conflict of interest
between the Covered Officer’s personal and professional
obligations to Integrity.
Investigating Actual and Apparent Conflicts of
Interest
CFH will follow these procedures in investigating and enforcing the
Code:
■
The
Committee will take all appropriate action to investigate any
potential violations reported to them;
■
If,
after such investigation, the Committee believes that no violation
has occurred, no further action is necessary;
■
Any
matter that the Committee believes is a violation will be reported
to the Board;
■
If
the Board agrees that a violation has occurred, it will consider
appropriate action, which may include review of, and appropriate
modifications to, applicable policies and procedures; notification
to appropriate personnel of the investment adviser or its board; or
a recommendation to dismiss the Covered Officer;
■
The
Committee will be responsible for granting waivers, as appropriate;
and
■
Any
changes to or waivers of this Code will, to the extent required, be
disclosed as provided by SEC rules.
Amendments and Disclosure
At least annually, the Audit Committee of the Board will review the
Code and determine whether any amendments or waivers of the Code
are necessary or desirable. Any amendments to this Code,
other than amendments to Exhibit A, must be approved or ratified by
a majority vote of the Board, including a majority of independent
directors. CFH’s Code for Covered Officers will be
posted and maintained on CFH’s Internet site and will be
filed as an exhibit to CFH’s Annual Report on Form
10-KSB. CFH’s Form 10-KSB shall disclose that the Code
is maintained on CFH’s Internet site and shall indicate if
changes to and waivers of the Code will be posted to the Internet
site.
Record Retention and Confidentiality
All reports and records prepared or maintained pursuant to this
Code will be considered confidential and shall be maintained and
protected accordingly to the extent permitted by applicable laws,
rules and regulations. Except as otherwise required by law or
this Code, such matters shall not be disclosed to anyone other than
the appropriate Board and its counsel.
For Internal Use Only
The Code is intended solely for the internal use by CFH and
does not constitute an admission, by or on behalf of CFH, as to any
fact, circumstance, or legal conclusion.
Exhibit A
Persons covered by this Code of Ethics:
Chief Executive Officer
Chief Financial Officer
Controller