easy · FRM Part 1 Foundations of Risk Management

According to the GARP Code of Conduct, if a risk professional discovers a significant error in a colleague's model that is being used for regulatory reporting, their first responsibility is to:

1. Sell the firm's stock before the error becomes public to protect their personal wealth.
2. Publicly announce the error on a professional networking site to warn other institutions.
3. Quietly fix the error themselves without telling anyone to avoid embarrassing their colleague.
4. Immediately report the error to the appropriate supervisor or compliance officer within the firm.

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