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APC - Commerical > Additional Ethics Questions > Flashcards

Additional Ethics Questions Flashcards

1
Q

What are the key functions of RICS?

A
  • The RICS promotes and enforces the highest professional qualifications and standards in the development and management of land, real estate, construction and infrastructure.
  • Its functions: consumer protection, influence policy, set standards, accredit professionals, quality assurance
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2
Q

What’s a Royal Charter?

A

A Royal Charter is an instrument of incorporation, granted by The King, which grants independent legal personality on an organisation and defines its objectives, constitution and powers to govern its own affairs.

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3
Q

What do you understand by the term self-regulation?

A

An organisation regulates itself without the involvement of external bodies

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4
Q

Can you tell me what you understand by the principles of better regulation?

A

Transparent, proportional, accountable, consistent and targeted

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5
Q

What is a bye-law?

A

Regulation made by an organisation or corporation

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6
Q

Explain to me the new RICS Rules of Conduct - what do they replace?

A

Replaces rules of conduct for member and rules of conduct for firms

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7
Q

What publication sets out disciplinary procedures the RICS can impose>

A

Sanctions Policy: Guidance to RICS Disciplinary, Registration and Appeal Panel Rules (2019)

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8
Q

When did RICS last update their disciplinary panel rules?

A

1st October 2019

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9
Q

What do you understand by the term professional practice?

A

Refers to the conduct and work of someone from a particular profession. Professions are occupations that require a prolonged period of education and training. They are often overseen by professional bodies who may accredit educational establishments and qualified professional

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10
Q

What is Professional Indemnity Insurance (PII)?

A

Professional indemnity insurance protects against claims for loss or damage made by clients or third parties as a result of the impact of negligent services provided or negligent advice offered

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11
Q

What is a PII aggregation clause?

A

An aggregation clause governs what happens if there is more than one claim under the same policy in the same year. It enables two or more separate losses covered by the policy to be treated as a single loss for the purposes of the excess or deductible or the limit of liability

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12
Q

What does ‘claims made’ mean in terms of PII?

A

Basis of policy means that policy in place at the time the claim is made by the client will provide cover

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13
Q

In a negligence claim, what would help to show you acted with consideration and due process?

A

Showing you undertook the instruction adhering to RICS best practice guidance

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14
Q

Can good record keeping help to provide a defence in a PII claim?

A

Yes, shows acted with consideration and due process and acted reasonable not to inflict damage or harm

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15
Q

What is the RICS document for PII?

A

RICS Regulation Professional indemnity insurance requirements, Version 9, Effective 2nd February 2022

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16
Q

What is run off cover?

A

Cover in place for the period after a firm ceases to trade.

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17
Q

What changes did RICS recently make to the Minimum Approved PII Wording?

A
  • 2022 update to reflect change to excess requirements
  • Removed for larger firms
  • 2.5% maximum excess requirement for smaller firms remains
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18
Q

Explain PII requirements relating to fire safety cover?

A

Insurers are not permitted without specific dispensation to exclude fire safety claims on a property four storeys or less and fire safety coverage must be provided, as a minimum, on an aggregate, defence cost inclusive basis

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19
Q

How long can a PII claim arise after the work is undertaken

A

6 years for claims regarding negligence

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20
Q

What is the Assigned Risks Pool (ARP)?

A

RICS market facility to ensure availability of professional indemnity insurance to regulated t firms who are unable to obtain PII which meets RICS minimum requirements

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21
Q

Who might need to access the ARP?

A

Firms who are unable to get cover due to the insurance market – doesn’t necessary reflect firm

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22
Q

Explain your understanding of the RICS Guidance Note Risk, Liability and Insurance?

A
  • RICS Guidnace Note: Risk liability and insurance, 1st edition, 2021
  • This guidance note is intended to assist both RICS-regulated firms and their clients to understand the main risks and liabilities associated with professional services provided by RICS members. It guides firms in the negotiation of equitable contracts with clients and the avoidance of major risks and pitfalls.
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23
Q

What is a liability cap?

A

A contractual agreement that a client can only claim damages up to the amount agreed, even if the law would otherwise award a greater sum in damages

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24
Q

Explain when you might agree a liability cap

A
  • Used as a way to manage the risk in professional work, to ensure there is a fair allocation of risk and reward between members and their clients
  • Valuation – red book requires valuers to include a statement on limitations on liability in terms of engagement and valuation report
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25
Q

How would set out third party reliance in Terms of Engagement?

A
  • Should be incorporated within the original terms of engagement of an instruction
  • Granted in line with PII
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26
Q

What are the three key terms that should be considered from a risk perspective in the context of every instruction you undertake?

A

The scope of the work
The basis on which the fee will be calculated
The liability cap

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27
Q

What is an annual return?

A

Annual submission by RICS firms to the RICS

28
Q

What is the RICS publication in regard to complaints handling?

A

RICS Guidance Note: Complaints Handling, 1st edition, 2016

29
Q

Tell me what you understand about Complaints Handling Procedures (CHP)

A

According to guidance note, the framework and content of the CHP must be relevant to the scale and scope of the service provided by the firm
An effective CHP should:
* Be fit for purpose
* Made available to all staff
* Understood by all staff
* Readily shared with complainants and protentional complainants
* Be regularly reviewed at a senior level
* Be agreed with PII brokers/providers
* Provide details of access to independent redress scheme

30
Q

When and how can the RICS be involved in a complaint about a firm or member?

A

Public can report concerns about and RICS member

31
Q

What is double dipping (dual agency)?

A

Where an agent has a contractual agency relationship with both the seller and the buyer at the same time

32
Q

Why is double dipping (dual agency) an unacceptable practice?

A

Cannot act immaterially for both parties, cannot act prudently to seek bes price for both parties – not in their interest

33
Q

How would you close down a regulated firm?

A
  • Agree the closure date (with other partners or directors if necessary)
  • If the firm is insolvent, seek appropriate advice
  • Inform staff and take any necessary steps to make them redundant, or allow them to seek government support
  • Inform clients of the firm and seek instructions
  • Deal with client money outstanding in your client account in accordance with the Client Money Handling professional statement
  • Notify your professional indemnity insurers and arrange run off cover
  • Make arrangements in respect of files and digital records you are holding to keep them safe and confidential for as long as required
  • Notify former clients for whom you are holding leases or other original documents
  • Confidentially destroy any documents you do not need to keep (bearing in mind the need to retain documents for tax and professional indemnity purposes)
  • Inform RICS, apply to deregister your firm and ensure your contact details are up to date
  • When you have ceased to practice, ensure that anyone trying to contact you will be notified that you have closed
  • Consider who else should be contacted about the closure of your practice
34
Q

What are the current RICS rules for registration of firms?

A

RICS Regulation: Rules for the Registration of Firms, Version 7, effective 2nd February 2022

35
Q

When did the RICS rules for registration of firms last change?

A

2nd February 2022

36
Q

What is a phoenix firm?

A

Firm carrying our practice of carrying on the same business or trade successively through a series of companies where each becomes insolvent. The business transfers but not their debts

37
Q

Who is a Responsible Principal?

A

The person in a regulated firm who has the primary responsibility for ensuring that RICS professional, technical and ethical standards are applies, upheld and supported by an appropriate assurance framework

38
Q

What are the rules around use of RICS logo and ‘Regulated by RICS’ designation?

A

RICS Regulation: Rules for the use of the RICS logo and designation by firms, version 6, effective 2nd February 2022

39
Q

When did the RICS logo and ‘Regulated by RICS’ designation rules last change?

A

2nd February 2022

40
Q

Tell me about the restrictions to the use of the designation ‘Chartered Surveyors’ by firms?

A

Can only be used in trading name and not in company name

41
Q

What is a locum and who might need one?

A

Another professional who is apportioned to stand in for a surveyor if they are unable to work (i.e. death, incapacity or extended absence)

42
Q

How could a sole trader set up their CHP using a locum?

A

Locum may be appointed by a sole practitioner as their complaints handling officer to ensure complaints handling procedure can be run fairly and impartially

43
Q

Explain your understanding of the RICS Scheme Rules relating to client money protection and when were they last updated?

A
  • Outlined rules of membership for surveying services and rules for property agents
  • Outlines scheme levy that must be paid
  • Rules for holding client money to be part of the scheme (same as RICS rules for client money)
  • 2019
44
Q

What are some of the key principles of the RICS PS relating to client money protection?

A

Objective of professional statement is the RICS members and regulated firms understand their obligations to ensure:
* Client money is kept safe
* Client money accounts are used for appropriate purposes only
* RICS-regulated firms have the appropriate controls and procedure to safeguard client money

45
Q

Explain the key themes from the RICS Futures 2020 Report

A

Talent and skills
Data and technology (AI and Internet of Things)
Sustainability (Ethics, data and the environment, protecting cities from climate change)

46
Q

Explain the potential implications of the Hart v Large case

A

High court case where purchasers (Hart and Hart) instructed Large to produce homebuyer report

Once purchased found problems with water ingress and damp and initiated negligence claim against Large

Hart that Large was negligent because his inspection and report failed to identify significant issues relating to damp

Implication: emphasises importance for surveyors of:
* Being clear and advising clients on the survey level and scope of inspection, limitations and caveats
* Recommending justifiable further investigation
* Considering whether any new information provided after inspecting or reporting affecting their original advise and updating their advise if it is justifiable to do so

47
Q

Explain your understanding of precedent set in Burgess v Lejonvarn

A
  • Claim that architect had acted negligently in the provision of professional services where there had been no payment
  • While there was no contract between the parties, a duty of care existed
  • On the facts, the allegations of negligence were dismissed
48
Q

What do RICS set out as good practice for the use of social media in their Regulation document

A

RICS Regulation: Use of social media: guidance for RICS members, version 1, effective June 2021

Same standards expected as if they were communicating face to face (or other traditional media)

RICS will investigate social media posts that are:
* are discriminatory
* are dishonest
* are abusive or threatening, or likely to cause significant harm, distress or offence to a person
* bully, harass or victimise a person or people
* show a pattern of frequent or a large number of concerning communications
* ignore previous advice or warnings about concerns.

49
Q

Explain your understanding of the RICS Levitt review

A
  • Independent reviewed commissioned by RICS to investigate claims that alleged that RICS ‘tried to supress a critical internal report into its finances in 2018/2019 and then unfairly dealt with those who sought to explore the issue
  • Conducted by Alison Levitt QC
  • Concluded that governance principles were not followed by the RICS
  • Contributing facto was a lack of clarify around roles and responsibilities of the various RIC boards, senior leadership and management – led to a lack of scrutiny over actions of the RICS CEO and COO
  • Set out 18 recommendations which the RICS Governing Council have adopted
50
Q

What are the six RICS values published as a result of the Levitt review?

A
  • Integrity
  • Transparency
  • Inclusion
  • Collaboration
  • Advocacy
  • Passion
51
Q

What is whistleblowing?

A
  • When a worker makes a disclosure of concerning wrongdoing in an organisation, typically something they have witnessed at work
  • Protected under Employment Rights Act 1996 (as amended by the Public Interest Disclosure Act 1998).
  • Must be in public interest and not personal grievance
52
Q

What does good governance mean to you?

A

The responsible conduct of public affairs and management of public resources

53
Q

What are the key values of the interim Governing Council statement relating to ethics, behaviour and culture?

A
  • Integrity
  • Transparency
  • Inclusion
  • Collaboration
  • Advocacy
  • Passion
54
Q

Explain what the Pandora Papers are and the ethical issues raised within them.

A

Leak of almost 12 million documents that reveals hidden wealth, tax avoidance and, in some cases, money laundering by some of the world’s rich and powerful

55
Q

Explain what you understand by the RICS Bichard Review

A
  • Commissioned by RICS Governing Council to review the Institution’s purpose, governance and strategy
  • Looked to identify why the problems identified in the Levitt Review arose and how they can be avoided in the future
56
Q

Explain some of the recommendations of the Bichard Review

A
  1. Revised purpose to be incorporated into the RICS’ charter
  2. Governing Council should consider the global strategy and a delegation framework to give appropriate freedoms, resources and responsibilities to regional and area boards, whilst maintaining globally consistent standards.
  3. RICS Matrics should be re-invigorated to give younger members a stronger voice in the Institution
  4. A Diversity and Inclusion Panel should be established to provide advice to the RICS Board and Standards and Regulation Board.
  5. RICS needs to significantly improve its technology
  6. Commercial activity be separated from other activities at RICS
57
Q

How will these recommendations be implemented by RICS?

A
  • RICS Governing Council has strongly endorsed the report and recommendations which aim to hand decision-making to members and ensure the Institution’s activities are centred on the public advantage
  • Five new working groups being established to take recommendations forward
58
Q

How do professional integrity and professional ethics differ?

A
  • Ethics are more external and integrity is intermal
  • Ethics can be defined as rules and regulations that have been formed which allow an individual to work in accordance to moral principles.
  • Integrity can be defined as the quality of being honest and fair.
59
Q

What is modern slavery?

A

Modern slavery is when an individual is exploited by others, for personal or commercial gain. Includes (but not limited to) human trafficking, forced labour and debt bondage

60
Q

What are some red flags of modern slavery?

A
  • Evidence of a workplace is being used for accommodation
  • Workers are distrustful of authorities
  • Workers look uneasy, unkempt or malnourished
  • Signed of psychological trauma
  • Untreated injuries
  • Evidence of control over movement (e.g. being picked up and dropped off in groups)
  • Signs of substance misuse
  • Worker who don’t know work or home address
61
Q

What is the Sanctions List and why should you be aware of it?

A
  • List published by the UK government
  • Provide details on those designated under regulations made under the Sanctions and Anti-Money Laundering Act 2018
  • Importance to be aware of to ensure compliance with the act and ensure you/your firm are not involved in money laundering and terrorists financing activities
62
Q

Why was the Register of Overseas Entities introduced?

A
  • Requires overseas entities that own land or property in the UK to declare their beneficial owners and/or managing officers
  • Introduced to make it more difficult for foreign criminals to launder money through UK property
63
Q

Explain the impact of the Economic Crime (Transparency and Enforcement) Act 2022

A
  • Aimed to strengthen the UK’s fight against economic crime
  • Created the Register of Overseas Entities
  • Strengthening of unexplained wealth orders
  • Making it easier to prosecute anyone involved in sanctions-busting
64
Q

Tell me about what you would do if you felt that an instruction was outside your scope of experience or knowledge

A

My client asked me to provide advice on planning restrictions on placing marketing board up in a vacant retail unit in Covent Garden, which is a protected conservation area. I let them no that I was unable to advise on planning matters

65
Q

What does the term ‘beneficial owner’ mean?

A

Those who ultimately own or control an asset, may be different from legal owners

66
Q

What is the most recent money laundering and terrorist financing regulations?

A

Money Laundering and Terrorist Financing (Amendment) (No 2) (Regulations 2022

67
Q

What changes were made in the Money Laundering and Terrorist Financing (Amendment) (No 2) Regulations 2022?

A

Focused on the extension of travel rules to cyrpto assets

APC - Commerical (10 decks)

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