CH4- New clients and engagements

Question 1

Obtaining clients

Answer 1

A member has no obligation to accept client work if offered

Client has the right to choose or change professional advisers, or take a 2nd opinion

Question 2

Fees and rewards

Answer 2

A member may pay a fee, commission or other reward to a 3rd party in return for the introduction of a new client provided that

1) a member has no reason to believe that undue pressure or influence was exerted on the prospective client by the 3rd party
2) before accepting instructions, a member has disclosed to the prospective client, in writing, both the amount and nature of fee

Question 3

Client acceptance

Answer 3

In acting for new client, member should take account of the following:
Risk assessment
Identification
Skills and competence
Conflicts of interest
Compliance with other regulations

RISCC

Question 4

Professional enquiry/professional clearance

Answer 4

Before accepting appointment, member should request permission to contact previous advisors
No response or negative response- need to consider whether to accept appointment

Question 5

Scope and engagement letters

Answer 5

On accepting instructions, members recommended to issue engagement letter
Manages client expectations
Clearly sets out scope and nature of assignment
Provides protection to member, and likely to be an important documents in a dispute
Certain minimum info requirements under Services Directive
No duty to investigate advice given by previous adviser unless agreed otherwise

Question 6

Services Directive

Answer 6

Member must provide certain information to clients and prospective clients

Question 7

FATCA

Answer 7

Foreign account tax compliance act