medium · FRM Part 1

Under the GARP Code of Conduct, if a risk manager becomes aware that a colleague is deliberately falsifying risk reports to hide limit breaches, what is their primary professional obligation?

1. Confront the colleague privately but avoid escalation to preserve team cohesion.
2. Ignore the situation if the breaches do not result in immediate financial losses.
3. Report the violation through appropriate internal channels and not condone the behavior.
4. Maintain confidentiality as the information was discovered during professional work.

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