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R01 2023 > Core Regulatory Principles And Rules > Flashcards

Core Regulatory Principles And Rules Flashcards

1
Q

What is the maximum compensation the Financial Ombudsman service can award for complaints about firms that occurred after April 1st 2020?

A

£375,000.00

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2
Q

If a new insurance company wants to be regulated, which governing body must they apply to?

A

PRA

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3
Q

What does 4A permission set out in the FSMA refer to?

A

Applying to the FCA for direct authorisation to allow the firm to carry out the regulated activities they have applied for

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4
Q

What is required in order for a firm to remain exempt status?

A

It must be contracted to an authorised person responsible for their activities

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5
Q

What firms were automatically re-authorised?

A

Firms authorised under the Banking Act 1987, Insurance Companies Act 1982 and the Financial Services Act 1986

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6
Q

What is an appointed representative?

A

Where a firm has exempt status as it has a contract with an authorised person who is regulated who has excepted responsibility for their activities

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7
Q

What is an appointed representative?

A

Where a firm has exempt status and has a contract with an authorised person who has accepted responsibility in writing for their activities

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8
Q

What important bodies are exempt from FCA regulations?

A

Bank of England
Local authorities
Various government bodies

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9
Q

How often should a senior manager prove they are fit and proper?

A

Annually

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10
Q

Who do conduct rules apply to?

A

Everyone employed by the firm apart from ancillary staff

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11
Q

How many tiers of conduct rules are there and who do they apply to?

A

Tier 1 - apples to all
Tier 2 - apples to all senior managers only

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12
Q

What are the tiers of firms?

A

Core, limited scope and enhanced

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13
Q

If a principle terminates an AR (must be in writing) how many days do they have to notify the FCA?

A

They must notify the FCA within 10 days

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14
Q

How long must records be kept?

A

Indefinitely for pension transfer / opt outs
5 years life and pensions
5 years most other dates
3 years non MiFID

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15
Q

When must product providers report persistency to the FCA?

A

Annually for the first 4 years

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16
Q

How often must firms submit reports on complaints?

A

Twice a year

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17
Q

How many hours of CPD is required for an authorised person?

A

35 hours (21 must be structured)

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18
Q

How many additional hours CPD for a pension specialist?

A

Additional 15 years

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19
Q

A new entrant has _____________ to complete relevant exams.

A

48 months

20
Q

What is meant by the general prohibition?

A

It is an offence to carry out regulated activities unless authorised or exempt

21
Q

Are there any exempt bodies?

A

Yes, The Bank of England
Local Authorities
Various government bodies

22
Q

What is an approved person?

A

An individual approved to carry out a controlled function

23
Q

What are the three main categories of senior management functions?

A

Governing functions
Required functions
Systems and control functions

24
Q

What is money laundering?

A

The process for when criminals turn illegally obtained money into apparently legitimate funds

25
Q

What are the three stages of money laundering?

A

Placement
Layering
Integration

26
Q

What is the financial action task force?

A

The global money laundering and terrorist watch dog. Uk and other countries come together to fight financial crime

27
Q

What directives came into place to combat money laundering and introduced joint money laundering steering group guidance?

A

4th & 5th money laundering directives

28
Q

When does a credit check need to be carried out?

A

When establishing a new business relationship
Carrying out occasional transactions money laundering suspicions
Terrorist financing suspicions

29
Q

When may a simplified due diligence (SDD) check be carried out?

A

For low risk transactions

30
Q

When may a enhanced CDD check be required?

A

When someone is a potentially political exposed individual, person is not present, anyone from a high risk country

31
Q

What steps are included in the identification process?

A

Identify customer and
Verify ID

32
Q

How does eIDV (electronic identity verification) work?

A

Matches client information imputed to details on a public database

33
Q

What is a SAR?

A

Suspicious Activity Report

34
Q

How often must a firm report review of AML systems?

A

Annually

35
Q

How long should records of clients ID be kept for?

A

5 years after end of client relationship or 5 years after the transaction

36
Q

If a firm has a serious data breach this must be reported to:

A

The Information Commissioner

37
Q

What is the maximum fine for a data breach is:

A

£17 / €20 or 4% of global turn over whichever is the largest

38
Q

How long does a firm have to settle a complaint?

A

8 weeks

39
Q

What is FOS’s aim?

A

To resolve disputes quickly and minimum formality

40
Q

To take a complaint to FOS what is the time frame?

A

8 weeks after initial complaint with firm
Within:
6 weeks of last communication with firm
6 years after the event occurred
3 years after claimant was given a reason to complain

41
Q

How much compensation can FOS award?

A

£350,000 for complaints they can award more however firms are not obliged to pay more

42
Q

How much are the limits for compensation that can be paid by FSCS?

A

Deposits, investments, home finance and SIPP provider £85,000
Insured personal pension provider, long term insurance 100% no limit
Intermediary insurance and general insurance 90%

43
Q

What do the pension protection fund do?

A

Compensate members for eligible BD schemes where a firm insolvent and unable to pay benefits

44
Q

Who are TPO?

A

The Pension Ombudsman mediator for pension complains

45
Q

Under the Money Laundering Regulations what does Customer due diligence encompass?

A

Customer due diligence must be carried out when a regulated firm begins a business relationship with the customer. The verification of a customer’s identity must be sought along with the nature of the business relationship

46
Q

If a regulated firm wants to move address when do they need to notify the FCA?

A

In advance of the address change

R01 2023 (12 decks)

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