The CFP Board's inconsistent disciplinary record proved irrelevant to a federal judge – a development that, experts say, illustrates a systemic problem in the abuse-prone world of nonprofits.

Longstanding precedent in state and federal laws prevent courts from interfering in nonprofits' internal matters – unless they involve crimes such as theft. As a result, many nonprofits routinely abuse their power without fear of repercussions, says Tom Hazen, a law professor and an expert in nonprofit governance at the University of North Carolina.

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