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RICS Core > 3 - Ethics > Flashcards

3 - Ethics Flashcards

1
Q

Tell me about RICS PII Requirements

A
  • Must be Each and Every or ITAWRTCR
  • Must be as per minimum levels and uninsured excess
  • Must be by RICS approved insurer
  • Covers past and previous employees
  • Must be fully retroactive
  • Must have run off cover
  • Take note of minimum policy wording
  • No fire safety inclusion on building under 4 storey
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2
Q

What are the different types of RICS Publications?

A
  • Professional Statements
  • Guidance Notes
  • Data Standards
  • International standards
  • Assessment standards
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3
Q

Name some Professional Statements

A
  • Client Money Handling
  • Conflicts of Interest
  • Countering Bribery, money laundering, corruption and terrorist financing
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4
Q

Name some Guidance Notes

A
  • Asbestos
  • Surveying Safely
  • Lessons Learned
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5
Q

Explain the Principles of Better Regulation

A

Better Regulation Executive set out 5 principles:

  • Proportional
  • Accountable
  • Consistent
  • Targeting
  • Transparent
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6
Q

Explain how the RICS abides by the Principles of Better Regulation

A
  • Proportional - Fines fit the punishment
  • Accountable - To the members and public
  • Consistent - Treats all members/firms equally
  • Targeting - Doesn’t have a scattergun approach
  • Transparent - Clear, concise and easily followed
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7
Q

Name all the RICS Standards of Conduct

A
  • Countering Bribery, corruption, money laundering and anti-terrorist financing
  • Conflicts of Interest
  • Ethics
  • Rules of Conduct
  • Client Money
  • Risk, Insurance and Liability
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8
Q

What are the RICS requirements for a CHP?

A
  • Must be in at least two stages 1) deal with it internally and 2) refer to independent redress
  • Acknowledge within 7 days, respond within 28
  • Fit for purpose and understood by staff
  • Agreed by PII Brokers
  • Must be freely provided
  • Must have a form of ADR approved by the RICS
  • Must keep a Complaints Log
  • Must notify insurer if required
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9
Q

When does the RICS get involved in Complaints?

A

Usually only if the Firm has not responded to the complaint or has prevented the complainant accessing the independent redress mechanism in some way

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10
Q

What are the Ethical Standards? Name them.

A

The standards set by the RICS that all members should uphold in the course of their work.

  • Act honestly, with integrity and comply with obligations
  • Professional competence
  • Always provide a high standard of service
  • Treat other with respect
  • Take responsibility and act in the public interest
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11
Q

When was RICS formed? What is the structure?

A
  • Formed in 1868
  • Awarded Royal Charter in 1881
  • Privvy Council - Awards RC and ratifies changes
  • Governing Council - Fulfils RC duties
  • RICS Board - Delivery of business plan
  • Standards and Regulation Board - Sets S&Rs
  • Audit Committee - Internal audit across entire organisation
  • Regulatory Tribunal - Independent body that acts as the disciplinary panel
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12
Q

What do you need to do when setting up a Firm?

A
  • Register with Companies House
  • Comply with Companies Act 2006
  • Register with RICS - at least 25% of directors needs to be MRICS
  • Appoint a contract officer/principal representative
  • Comply with the Rules of Conduct
  • Submit an Annual Return to RICS
  • PII Cover from RICS insured
  • Submit annual accounts
  • Set up designations / locum
  • CPD, training and development
  • Complaints handling procedure
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13
Q

What do you need to do when closing down a Firm?

A
  • Inform RICS
  • Hand over Clients to others
  • Return Client Money
  • Keep files for 15 years (recommended)
  • Obtain run-off cover
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14
Q

Can you tell me what is in the Countering Bribery, Money Laundering and Terrorist Financing Professional Statement?

A
  • Sets out what firms must and must not do
  • Have procedures in place to prevent such as doing identify/credit checks
  • Report suspicious activity
  • Retain records
  • Having a record of all hospitality
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15
Q

Tell me about the Proceeds of Crime Act 2002

A
  • Allows Government to recover proceeds of crime

Also established the following crimes:

  • Using criminal property
  • Knowingly entering in to an agreement where criminal property/proceeds are involved
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16
Q

Tell me about the Money Laundering and Terrorist Financing Regulations 2019

A
  • Cannot be complicit
  • Have systems and training in place
  • report suspicious activities
  • Take measures to understand client and purpose of transaction
  • Record info detailing how firms have met RICS standards.
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17
Q

What is Stace’s CHP process?

A

Complaint in writing
Goes to the Nominated person who has 7 days to understand the issue and 21 days to make a decision
If you don’t like a decision it goes to the RICS Representative, 14 days
Don’t like the decision it goes to mediation and then arbitration

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18
Q

How do you act with Integrity?

A
  • Be honest and trustworthy in all that I do; never accept a bribe.
  • Not revealing a winning bidders fee
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19
Q

How do you treat others with respect? Give an example for your Case Study

A
  • Practice Active Listening
  • Democratic leadership in chairing meetings
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20
Q

How do you act in a way that promotes trust in the profession? Give an example for your Case Study

A
  • I conduct myself professionally in both my work and personal life, particularly with regards to social media.
  • Short timescales for the production of Options Appraisal - promised the Client I would have it done in time and I did.
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21
Q

How do you provide a high standard of service? Give an example for your Case Study

A
  • Have reports, some forms of communication and complex emails peer reviewed and checked by colleagues.
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22
Q

How do you take responsibility? Give an example from your Case Study

A
  • On behalf of the team I own any mistakes made by the project team and manage them fully to resolution, including keeping the Client informed of progress.
  • Consulted extensively with Planning Consultant to show the impact to the master schedule.
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23
Q

What is a Bribe? Tell me about the Bribery Act.

A
  • A payment in money or in kind as an inducement for a party to act unethically, illegally or a breach of trust.

1) Top level commitment
2) Due Diligence
3) Communication
4) Risk Assessment
5) Proportionality
6) Monitoring and Review

  • Outlaws Facilitation Payments
  • 10 year sentence/unlimited fine for individuals
    Unlimited fine for companies
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24
Q

What should be in a Service Agreement or Terms of Engagement with a Client?

A
  • Scope
  • Basis on which fee is calculated
  • Liability Cap (specific attention drawn)
  • Advise over CHP
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25
Q

What actions must you take before undertaking work for a Client?

A
  • Check whether any conflicts of interest
  • Risk assessment over DD if applicable
  • Have a contract/agreement in place
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26
Q

What questions does the RICS Ethical Decision Tree post?

A
  • How does your action fit with the ethical standards?
  • Is what you’re doing legal?
  • Ultimate test - Would you be happy to have your actions made public?
  • Do not proceed, act and reflect, record decision and outcome
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27
Q

What is Stace’s Gifts and Hospitality Policy?

A

Under £50 - Partner Approval
£50-200 - Declare
Over £200 - Permission from partner and disclosed ahead of accepting

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28
Q

What are the RICS Disciplinary Proceedures?

A
  • CPD Sanctions and Fines for when members have not completed CPD or provided information when required. Usually a stepped process (i.e. first time is a warning)
  • Regulatory Compliance Order - Agreement between Firm and RICS that something needs to be improved. Action plan to address.
  • Disciplinary Panel Hearing - For serious cases or continued breaches.

Usually only gets involved when it finds something in audit, information isn’t provided, CPD isn’t done or complain/whistleblowing from another party

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29
Q

What are the most common causes for RICS to conduct disciplinary proceedings?

A
  • Not completing required CPD
  • Mishandling Client Money
  • Not acting in a professional manner
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30
Q

Tell me about the Modern Slavery Act 2015

A
  • Sets out the varying types of modern slavery
  • Produce S.54 statement stating what they have done in the past year to combat MS.
  • Perform Due Diligence checks on Clients/Supply Chain as required.
  • Report anything suspicious to the Home Office
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31
Q

What did RICS do as a result of the Merrett vs. Babb Case?

A
  • Set up the Member Support Service
  • Set recommended liability wording
  • Mandated run off cover
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32
Q

What are the 3 Key Sectors in the RICS?

A
  • Land
  • Property
  • Construction
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33
Q

Name 6 Professional Groups

A

18 Professional Groups in total
- Project Management
- Facilities Management
- Building Surveying
- Valuation
- Quantity Surveying and Construction
- Dispute Resolution

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34
Q

What is the purpose of the Professional Groups?

A
  • Steer and set the entry and assessment requirements to that pathway
  • Contribute to development of RICS standards, strategy and direction
  • Act as a network for knowledge sharing and support
  • CPD support
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35
Q

What is the Levitt Review?

A
  • Review in to dismissal of directors who raised concerns about alleged mismanagement of funds
  • Report has been issued
  • Many recommendations
  • Exec team stepped down
  • Further review being undertaken by Lord Bichard
  • No illegal activity and governing council more control over management and below
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36
Q

What did RICS do in response to Grenfell?

A
  • Lobbied and provided advice to government
  • Provided guidance to landlords and residents
  • Set up dedicated Fire Safety Hub online
  • Produced documentation on the External Fire Wall review process (EWS) and the EWS1 Form
  • Worked with insurers to remove blanket exclusion on fire safety in terms of PII
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37
Q

What are the 4 main roles of the RICS and the purpose under the Royal Charter?

A
  • Regulate and promote the profession
  • Maintain the highest professional and educational standards
  • Protect Clients and Consumers via a strict code of ethics
  • Provide impartial advice and guidance

“Promote the usefulness of the profession for the public advantage in the UK and in other parts of the world”

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38
Q

What are the RICS Standards of Conduct?

A
  • Ethics
  • Rules of Conduct for Members and Firms
  • Client Money
  • Conflict of Interest
  • Bribery, Corruption, Money Laundering and Terrorist Financing
  • Risk, Liability and Insurance
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39
Q

Can you tell me about Client Money Handling?

A
  • Keep Client money safe
  • Ensure robust processes in place for managing money
  • Client Money used for appropriate purposes only
  • Never go overdrawn
  • Full audit trail and ledger
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40
Q

What is the Client Money Protection Scheme?

A
  • Provides protection, as a last resort, in instances where an RICS Regulated firm is unable to repay a client’s money, up to the limits and exceptions set out in the scheme rules.
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41
Q

What is the Royal Charter?

A
  • Establishes separate legal entity of the body itself rather than just the individuals
  • Required RICS to develop profession for public advantage
  • Allows members to use ‘Chartered’ in their title
  • Written description of RICS powers and obligations
  • Awarded by Victoria to maintain and promote the usefulnes of profession for public advantage
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42
Q

What is the RICS Vision?

A

“To be recognised in key international markets as the leading body that develops and enforces professional standards, and offers access to the most sought-after professional status”

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43
Q

What is the purpose of the RICS?

A
  • Regulate and promote the profession
  • Maintain the highest professional and ethical standards
  • Protect Clients and Consumers via a strict code of ethics
  • Provide impartial advice and guidance
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44
Q

What the 4 key elements of the new RICS business plan?

A

TIPS

  • Trusted by our stakeholders and society
  • Influential thought leader
  • Professional qualifications remain in demand
  • Sustainable 21st Century professional body
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45
Q

What are the 6 key principles of the Bribery Act? What is the mnemonic?

A

DTM and CPR

  • Due Diligence
  • Top Level Commitment
  • Monitoring and Review
  • Communication
  • Proportionality
  • Risk Assessment
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46
Q

Can you tell me about the current senior staff at the RICS?

A

President - Ann Gray
President Elect - Tina Paillet
CEO - Justin Young

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47
Q

Can you talk about any articles you have seen in Modus?

A
  • Will 3D printed homes lead to a workforce revolution.
  • Addresses the problem of reduced workforce. Construct a storey a day
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48
Q

What is the RICS HQ Address?

A

12 Great George St. Parliament Square

49
Q

Why do you want to join the RICS?

A
  • Validate my competency in the most prestigious way
  • Access to network of professionals
  • Great base for further development via professional groups and forums
50
Q

What should you check before starting work for a client?

A
  • Terms of Engagement/Service are clear and agreed
  • No conflicts of interest
  • Competent to undertake the work
  • Basis of Fee
  • Scope agreed
  • Statement of liability etc.
51
Q

Can you name me two pieces of legislation that are related to ethics?

A
  • Equality Act 2010
  • Bribery Act 2010
  • Money Laundering and Terrorist Financing Regulations 2019
52
Q

What are the RICS Bye-Laws? Can you give some examples?

A

Set out the specific internal RICS rules that it must abide by itself. Examples:

  • Setting the value of membership fees
  • Specifies what designations can be used by who
  • Members to notify if they may be receiving a custodial sentence
53
Q

What does the RICS stand for?

A

Promotion and enforcement of the highest professional qualifications and standards in the development and management of land, real estate, construction and infrastructure.

54
Q

What are the three professional statements related to Ethics?

A
  • Conflict of Interest
  • Client Money
  • Countering Bribery, Corruption, Money Laundering, and Terrorist Financing
55
Q

What tools did the RICS produce to assist with CPD?

A
  • CPD Tree (is it formal / informal)
  • Offer CPD Seminars
  • CPD Checklist
56
Q

What changes were there to the PII requirements this year?

A
  • Greater fire safety cover
  • Assigned risks pool increased
  • Increased number of insurers
57
Q

What is the Client Money Protection Scheme? What are the limits?

A
  • For the misappropriation of client funds from an agent
  • Last resort to protect Client money in the event RICS firm can’t pay it back.
  • £50k limit per claim
  • Absolute maximum £20.3m aggregate.
58
Q

What are some of the Client Money rules?

A
  • Must have the name and the word ‘Client’ on the account name
  • Ledger must be kept
  • Full access at all times
  • Cannot go overdrawn
  • Full records
59
Q

What is a regulatory compliance order?

A

Agreement between RICS and a member or firm that accepts liability for a wrongdoing and:

  • admits that they have fallen short of the standards expected
  • agrees to an appropriate sanction
  • in some cases, take steps to meet the standards expected and/or to prevent it happening again
60
Q

What are the 7 cautions/reprimand for regulatory compliance orders?

A
  • Caution
  • Reprimand
  • Undertakings in the future
  • Stop doing something
  • Fine (£2000 action)
  • Conditions on individual membership
  • Conditions on firm regulation in future
61
Q

What is the Bichard Review?

A
  • Following Levitt Review an independent review of the RICS based on three key requirements from the Governing Council:
  • Made proposals for how RICS can become a beacon of best practice, transparency and legitimacy to strengthen its reputation.
  • Re-establishing RICS’ reporting lines
  • Introduction of new leadership roles to simplify its governance model
  • Public fund for public interest activities
62
Q

Why is the 15 year limitation limit the absolute backstop for contract liability?

A

Latent Defect Act 1986 provided an additional 3 years on the 1980 Limitation Act 12 year backstop, from the point they know about the issue, to put together a claim. Hence 12 + 3 = 15.

63
Q

What is the role of the RICS?

A
  • Be leading global body for the profession
  • Create standards that are in the publics interest
  • Develop members professionally
  • Provide opportunities for it members
  • Promote usefulness of the profession for the public advantage in the UK and in other parts of the world
64
Q

How is the governing council elected?

A

By members every 3 years

65
Q

How do you become involved in a professional group?

A
  • Sector forum - after APC
  • Leader’s forum - after APC
  • Working group - anyone at any time
66
Q

What is a complaint?

A

Expression of dissatisfaction

67
Q

What is meant by Fully Retroactive?

A

Covers all current and previous work done

68
Q

What is meant by a Full Civil Liability basis?

A
  • Widest cover available - all aspects included unless it’s specifically not.
  • Covers acts of liability that non-negligent.
69
Q

What are the typical PI premiums? What are they based on?

A
  • 1-5% of turnover
  • Based on overall risk profile of your firm
70
Q

Who makes the RICS disciplinary rules?

A
  • Regulations and byelaws allow Standards and Regulation board to administer the rules
71
Q

What are the Bye Laws set by the RICS?

A

Internal rules governing the management of a corporation and covering such matters as election of directors, appointment of committees, duties of officers and permitted business activities.

2 - Membership and Registration
5 - Conduct
8 - Procedure for General Meetings and Voting
9 - Accounts and Audit

72
Q

What is Run off Cover

A

Protection against claims after ceasing business operations

73
Q

What are the 5 rules of conduct?

A

IPA TA
Act with honesty and integrity
Provide a high level of service
Act within your competency
Treat other with respect
Act in public interest

74
Q

What is a conflict of interest? Do you have an example?

A

When an individuals personal interests could compromise their judgement, decisions or actions.

A director recommends a tender bid by a company owned by a relative

75
Q

What standards does the Stace Ethical Trading Policy set?

A

Promotes policies to encourage a culture of ethical behaviour within the business

  • Operate non exploitative employment practices
  • Conflict of interest and bribery
  • Community and ‘giving back’
76
Q

What is Lionheart?

A

An RICS charity set up to support RICS past present and future members through difficult times.

77
Q

What do you need to set up a RICS firm?

A
  • Comply with Companies Act 2006
  • PI Insurance
  • 25% of board memebers must be MRICS
  • Complaints Handling Procedure
  • Employers Liability Insurance
  • Comply with Rules of Conduct / Royal Charter / Bye-laws
  • Provide CPD
78
Q

Locum Agreement

A

Sole practitioner is incapacitated it would set out fees, scope and disbursements etc.

79
Q

Professional Obligations for Firms

A
  • Complaints Handling Procedure
  • Have adequate PII
  • Sole practitioner have arrangements for death / incapacity
  • Cooperate with RICS
  • Provide info to S&R board
  • Designation to denote RICS regulation
  • Must report anything they are required under Rules for the Registration for Firms
80
Q

What is the privvy council?

A
  • Changes to bye-laws have to be approved even if majority want it
81
Q

What is the RICS Matrix?

A

Established to support, develop and provide networking for members for entering / newly qualified members

82
Q

Rules for registration of firms

A
  • 25% of principals to be chartered
  • Required to register is 50% of partners are members
  • Must have responsible person
  • Responsible person must take all reasonable steps to ensure the firm complies with regs / stat obs
  • Complies with professional obligations
83
Q

Functions of professional groups

A
  • Drafting reviewing and maintaining guidance
  • Setting up the standard of professional competence
  • Contribute to policy information
  • Commission and undertake specialist research
  • Contribute to CPD events
84
Q

What are the different types of documents the RICS produces?

A

Practice Statements - Mandatory requires to comply with bye-laws
Codes of Practice - Docs approved by RICS and endorsed by other bodies
Guidance Notes - Recommendations for accepted practice
Information Papers - Practice based papers with latest info

85
Q

Minimum Uninsured Excess

A

Less than 10m - 2.5% or 10k
Greater than 10m - non limit

86
Q

PI Fire Safety Exclusions

A
  • From 1st May 2021 any exclusion will not apply to professional work to buildings of 4 storeys or under.
87
Q

What is Run-Off Pool?

A

Firms that are unable to obtain run-off from their incumbent insurer or the open market will be able to apply for coverage from the pool.

88
Q

What are Assigned Risks Pool?

A

Open to all RICS firms that are unable to obtain PII which meets the RICS Standards

89
Q

What are Assigned Risk Pool considerations?

A
  • Entry considered if all options are exhausted
  • Deposit and final premium substantially higher
  • Extent of cover lower as aggregate rather than E&E
  • Firms remain in for max 3 years to which they will be audited and guided to amend practice
90
Q

Client complaint to a sole practitioner?

A
  • Escalated if cannot be dealt with internally
  • Appoint mediator or PI
91
Q

Your friend is failing to meet standards what do you do?

A
  • Verify facts
  • Remind them of duties
  • Complain if nothing changes
92
Q

Client Money Handling Best Practice

A
  • Separate designated bank accounts
  • Client approval of account handling terms
  • Monies available to pay client on demand
  • Interest paid to client
  • Agreed signatories
  • All firms audited by RICS
93
Q

What is the Client Money Protection Scheme?

A
  • Run by the RICS
  • Member of public get reimbursed for loss of funds
  • Provided through RICS Insurance policy
94
Q

What would be considered a high standard of service?

A
  • Understanding Client Needs
  • Advising clients of latest regs
  • Communicating clearly allowing for informed decisions
  • Encouraging sustainable solutions
95
Q

What firms must do for bribery

A
  • Dont offer or accept a bribe
  • Do not bribe a foreign public official
  • Ensure adequate training is in place
  • Comply with applicable laws
  • Undertake due diligence
  • Show compliance with RICS requirements
  • Have adequate knowledge of bribery and corruption
  • Report any activities that breach laws
96
Q

Client Bank Accounts

A
  • RICS firms must hold client money in a client money account where firm has exclusive control.
  • Ensure client money is available instantly
  • Ensure money is paid into account promptly
  • Obtain a receipt for an indemnity of client money paid into a charity
  • Only use client money for client matters
  • Leftover money is returned
  • Ensure all payments from client money has written approval
  • Check sufficient funds are available for payment
  • Records of money in and out
  • Publish written procedures
97
Q

RICS Countries and Members

A

149 Countries
140,000 members

98
Q

How do you register with the RICS?

A

Contact RICS to recieve a start up pack
Inform the RICS and register for regualtion
Appoint a contact officer

99
Q

Stace’s Money Laundering and Bribery

A
  • Anti corruption training
  • Evaluate controls periodically
  • Ensure sufficient knowledge
  • Do not be complicit
100
Q

Types of conflict of interest

A
  • Party conflict
  • Own interest conflict
  • Confidential information conflict
101
Q

Types of risk?

A

Project risks
Programme risks
Consequential risks
Political Risks

102
Q

What is a project manager?

A

An individual that control manages and coordinates people to complete a certain project objective.

103
Q

When is CPD Formal?

A
  • Formal Structure
  • Independently assessed
  • Learning enhances technical knowledge
104
Q

What is informal CPD

A
  • No formal structure
  • Self assessed
  • Does not enhance technical knowledge
105
Q

When do you have to submit CPD to the RICS

A
  • Actual courses completed 31 December
  • Submitted online on 31 January
106
Q

What did you learn from the Party Wall CPD?

A
  • Resolves disputes before construction starts
  • Prevents people undermining structural integrity of neighbours
  • A PW is something that separates each owner but both have an interest.
107
Q

What did you learn from the Role of a Clerk of Works CPD?

A
  • Role of the Clerk of Works
  • Common mistakes (brick ties too short, weep holes missing)
108
Q

What did you learn from the KP Noise and Planning CPD?

A
  • Why we need it at planning stage
  • Affect on final user
  • Different decibel requirements at different places
109
Q

What did you learn from the Avande Home Tech CPD?

A
  • Smart tech in homes
  • One combined system
  • Services: lighting, security, network, electrical
110
Q

What did you learn from he Ardex Flooring CPD?

A
  • Product presentation
  • Services they provide: flooring, tiling, concrete repair, screeding
111
Q

What did you learning from the Disperse Building Tech CPD?

A
  • Programme presentation for a project management tool.
  • Show accurate progress again a programme
112
Q

What did you learn from the Mental Health CPD?

A
  • Importance of speaking to people
  • Employee assistance programme
  • Train line managers to spot it and be mental health first aiders
113
Q

What did you learn from the Building Regs - Office Fitout CPD?

A
  • Everything needs compliance.
  • Part A, structural changes like introducing a mezzanine
  • Part B, fire and exit routes 1 exit max 60 occupants.
114
Q

What did you learn from the Ekkist Healthy Homes CPD?

A
  • Best practice guidance based on studies and reports into what makes a healthy home.
115
Q

What did you learn from the Changes to Building Regs Part O, F, L & S CPD?

A
  • Part L, cut in carbon
  • Part F, minimise ingress of external pollutants
  • Part O, strategies to limit solar gain
  • Part S, new developments must have EVCP’s
116
Q

What did you learn from the WELL Certification Requirements for a Contractor CPD?

A
  • Contractor must review the testing requirements
  • Check before substituting products
  • Letter of Assurance signing
117
Q

What are the steps for Client Money Handling?

A
  • Hold money in a bank account you have exclusive control over
  • Keep this money safe
  • Use for appropriate purposes
  • Procedures to protect money
  • Include the word client and the name of the firm
  • Immediately accessible
  • Compliant with Countering Bribery etc.
118
Q

How is the RICS Regulated?

A

It is self regulated

119
Q

What did you learn from the Airflow CPD?

A
  • Impact of bad airflow, means overheating and uncomfortable
  • Reduced reliance on natural ventilation
  • Increased use of mechanical systems to achieve requirements.

RICS Core (15 decks)

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