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APC I&F > Ethics > Flashcards

Ethics Flashcards

1
Q

• What are the RICS Global and Professional Standards?

A

Service, Trust, Integrity, Responsibility, Respect (STIRR)

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2
Q

• What is bribery?

A

Bribery is the advantage gained from a payment or gift

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3
Q

• Any RICS guidance on bribery, ML and TF?

A

Yes, Professional Statement 2019 with mandatory requirements, guidance and a supplement.

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4
Q

• What are the principles in the guidance note for bribery?

A 
Proportionality
Top-Down management
Risk Assessment
DD
Communication
Monitor & review
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5
Q

• What are the types of bribery?

A

Giving a bribe, accepting a bribe, bribing a government official or failing to prevent bribery

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6
Q

• Who polices bribery?

A

Serious Fraud Office

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7
Q

• What are the punishments for bribery?

A

Up to 10-year prison and unlimited fine for individuals – unlimited fine for corporations

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8
Q

• What rules are in place to stop bribery?

A

Organization should have education and training in place, gift register, no value greater than £100 w/o compliance officer sign off

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9
Q

• What is money laundering?

A

Turning proceeds of illegal crime to legal tender

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10
Q

• What provisions in place for money laundering?

A

Written risk assessment, implement internal process/systems/policies to meet regulation requirements, approved internal controls, staff training, DD on new clients required for PEP, record keeping, AML check, no funds before exchange

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11
Q

• When should you report money laundering and who to?

A

When you have any suspicions about activity you’ve witness or taken part in. Complete a Suspicious Activity Report for the NCA

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12
Q

• What checks are there for new clients? What are the Red Flags?

A

Customer DD: ID, ID of Directors, Proof of funds, Comp. Detail and intended business/funding.
Enhanced DD: Checks for high-risk countries and PEP
Red Flags: Irregularities (Short time frame, loss making), unusual currencies, don’t want to give ID, Changes to parties involved

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13
Q

• What is the penalty for money laundering?

A

14 years and unlimited fine for undertaking money laundering

5 years and unlimited fine for not reporting

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14
Q

• What is the CPD policy?

A

20 hours p.a (10 formal) – Keep up with the ethical standards every 3 years and can use the RICS management system.

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15
Q

• What are CBRE’s complaints handling procedures?

A

Written assessment of procedures, signed of and aligned to RICS regulation, regulated to the CHO, attached to all TOE, requires written complaints, notify your PII cover asap, confirm receipt before 7 days, confirm investigation before 28 days and follow up with procedures to resolve.
If the complainant isn’t happy, they can take their complaints to the Centre Effective DR or to the RICS dispute resolution, SP names another surveyor.

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16
Q

• What is know your client?

A

CBRE internal system to check for conflicts and AML. Usually done on a client but can also be done building by building.

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17
Q

• What was the benefit from understanding the previous engagement?

A

The senior member of that team has a good relationship with the client and was able to assist with the onboarding. This further strengthened the original relationship.

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18
Q

• What type of conflict of interest was this? What are the other types?

A

Personal conflict – rather than a financial, commercial, or dual agency

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19
Q

• What would the process have been should you have continued with the engagement?

A

Consulted the professional statement 2017
Can you act impartially and independently
Is this conflict was manageable
Notify the client
Receive written informed consent
Input management procedures
Keep records

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20
Q

• What is the impact of conflict of interests?

A

Renders person involve can’t act independently and impartially. Cloud judgement and may act in an unprofessional manner.

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21
Q

Why would you reject the mandate. What ROC does this limitation of advice come under?

A

Competence – A surveyor always needs to know their limitations when it comes to undertaking a mandate to act in the clients best interests.

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22
Q

• What are the steps of an engagement?

A

Understand competence, assure there are no conflicts of interest and if there are ensure that informed consent is requested otherwise decline, submit and receive signed TOE prior to commencing work

Competent
COI
Signed TOE before Work

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23
Q

• Data centre refusal to give lender advice. Which ethical standard does this adhere to?

A

Service and trust

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24
Q

• What would you do if you were asked to do something unethical?

A

Decline, even if I was unsure and consult a senior colleague. If this was money laundering or other criminal activity, I would report it to the required persons.

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25
Q

What is the purpose/role of RICS?

A

Highest possible professional standard
1. Education & Training
2. Protect Consumers
3. Be the number one source of information on the built environment
Accountable to the public - Royal Charter - Standards docs provide confidence and transparency

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26
Q

What are the benefits of being a RICS member?

A 
Status
Recognition
Market Advantage
Knowledge 
Network
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27
Q

Why do you want to be an RICS member?

A

Status - being recognized as undergoing the necessary procedures to gain chartered status. Allowing me to provide credible advice on the built environment.

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28
Q

What are the principles of better regulation?

A 
Proportionality - Penalty to breach
Accountability - to all public
Consistency - treating equal
Transparency - to all members and public
Targeting -serious breaches
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29
Q

What is the RICS Decision tree?

A

Questions and dilemmas to consider legality and if actions were made public

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30
Q

When was the RICS founded and gained Royal charter?

A

1868 and 1881

31
Q

Who is the CEO?

A

Michael Collins

32
Q

Who is the president and president elect?

A

Clement Lau and Anne Gray

33
Q

What is the structure of RICS?

A

25 council members, 4 associations and 10 regional boards

34
Q

ROC for Members?

A 
Communication
Competence
CPD
Cooperation
Solvency
Service
Information
Interpretation
Ethics
35
Q

Benefits to regulation?

A

Confidence, Professionalism and Security

36
Q

What percentage of RICS registered directors required for Firm regulation?

A

50% (25% have to be if Firm regulated as having one didn’t ensure consistency and service aligned to the RICS)

37
Q

What information is required for regulation?

A 
Type of business
Statutory regulation - FS
Nature of Clients
CHP
PII 
Handling clients money
38
Q

Firms ROC 2020?

A 
Part 1:
Competence 
CHP
Clients Money
CPD
Professionalism
Indemnity Insurance
Service
Part 2:
Solvency
Advertising
Info to RICS
Designation
Cover of Death
Co-operation
39
Q

What disciplinary procedures are there?

A

Action by Head of Regulation
Disciplinary Panel
Appeal Panel

40
Q

4 Action that can be made by the head of regulation?

A
  1. Fixed Penalty (breaches in information submission)
  2. Regulatory compliance order
  3. CPD sanctions
  4. Disciplinary Panel
41
Q

What’s the make-up of the disciplinary panel and what punishments can they give?

A

50% Lay Members

  1. Compliance Orders
  2. Unlimited fines
  3. Future registration conditions
  4. Expulsion
  5. Make actions public in Modus, Local Papers
42
Q

What is the appeal panel?

A

Consider a member or firms appeal - review the decision having regard to new evidence presented - can alter the previous penalty imposed.

43
Q

Required PII cover?

A

Firm with turnover in excess of £200k need at least £1m indemnity required for each and every claim

44
Q

Required run-off cover?

A

Liability up to £500k = 2.5% of turnover or 10k

Over £500k = 2.5% of sum insured

45
Q

What is the basis of fee negotiation?

A

Avoid price fixing, cutting, collusion
Market based and ad hoc w/ clients
Vary service after negotiation
Transparent referral fees in TOE aligned to bribery act 2010

46
Q

How many day cooling off after Terms of Engagement?

A

14 days - aligned to Consumers Rights Act 2015

47
Q

Why would you decline an engagment?

A 
Competence 
Lack of facts on clients
Client won't sign TOE
Conflict of Interest
Govt. sanction list
PII can't be agreed or not covered
Content if actions made public?
48
Q

How would you deal with Clients Money?

A
  1. Separate Accounts
  2. Client on Cheque and Bank
  3. Monies on demand
  4. Account in credit and interest agreed
  5. Checked regularly
  6. Audited and review by RICS every 3 years
49
Q

Process of complaints handling procedure?

A 
RICS Guidance Note - 2016
CHP signed of by RICS
Notify PII insurer asap
Receive written complaint
CHO investigates
Acknowledge receipt within 7 days
Investigated within 28 days (20 at CBRE)
If not happy then alternative dispute resolution
Example: CEDR or RICS dispute resolution scheme
50
Q

What’s needed by RICS to start a new practice?

A 
Inform RICS
Appoint responsible principle
Register with RICS
Get PII cover
CHP signed off
Clients Money
Register for VRS - Red Book Valuations
CPD
Staff training
Annual Returns
51
Q

Statutory Requirements for starting a new business?

A 
Disclose business name
H&S
Financial Services compliant
Equality Act 2010
Fire safety
Bribery Act
ML officer
Asbestos Register
Data Protection
Insurance 
HMRC Tax & VAT return
52
Q

Requirements when closing a practise?

A 
Inform RICS
Inform Clients
Inform Insurer and get 6 year run-off cover
Return Clients monies
Keep information for 6 years
53
Q

4 Bribery Offences?

A
  1. Accepting a Bribe
  2. Giving a Bribe
  3. Bribing a PEP
  4. Failing to prevent bribery
54
Q

Any literature on Bribery, Corruption, ML & TF?

A

Professional Statement 2019 - Three sections:

  1. Mandatory requirements - procedures
  2. Guidance - Gifts register
  3. Supplement - 3 W’s
55
Q

What did you learn on the training for bribery, money laundering and corruption?

A

What they are and how to identify them -
Bribery is the gifting or payment in return for an advantage
Money Laundering is the conversion of illegally made money into legal tender
Corruption is the abuse of power by those entrusted with authority

Some of the red flags for ML: Different currencies, unusual features, unwilling to give ID docs and changes to parties involved

56
Q

What was the last CPD you undertook?

A

Introduction to ESG for Debt Funds -
Investor demand for ESG compliant funds
Understand Sustainability linked loans - aligning loan terms to borrowers performance against relevant sustainability performance targets. Incentivize the borrower’s achievement of ambitious, predetermined sustainability performance objectives

57
Q

Talk us through a piece of CPD you have undertaken?

A

Future of valuation - move towards a DCF method. Allows for risks and assumptions to be explicitly modelled rather than the risk implicitly shown in the yield.

58
Q

Are there any changes to the ROC?

A

Yes - 2022

Combination of the two with a focus on incorporating tech and sustainability

59
Q

What are the levels of PII?

A 
<100 = 250k
100-200k = 500k
>200k = £1m
60
Q

Who pays for ADR?

A

Usually agreed to be split, but the costs incurred in dealing with the dispute more generally will normally be allocated between the parties as part of any settlement achieved.

61
Q

What are the major challenges facing the RICS?

A

I think from my perspective it’s the assessment methods - from discussions it’s always been tough to schedule but this year has highlighted some real issues. It does make you question the professionalism, something that we are so strongly urged to keep.

From a wider perspective I think diversity and inclusion has been a historical challenge but it’s refreshing to see the proactive approach being taken. In the new ROC, changes include explicit requirements for firms to encourage diversity and to ensure a fair and inclusive profession, and to support all surveyors regardless of their background or differences, across the world.

62
Q

What are the RICS principles of regulation? How do the RICS principles of regulation ensure consumer protection?

A

Proportionality, Accountability, Consistency, Transparency and Targeting

Targeting for example - Ensuring serious breaches are minimized

63
Q

Give an example of each of the Professional and Ethical Standards in your experience?

A 
Service - 
Trust - 
Integrity - 
Respect -
Responsibly -
64
Q

What are the new ROC? How are they changing?

A

Simplified structure bringing all ROC into one doc. Incorporate sustainability and the use of technology.
5. Members and firms must act in the public interest

65
Q

Any recent disciplinary hearing you can tell me about?

A

Jack Cook - Found he had plagiarised his submission

66
Q

What do you include in a Equity Terms of Engagement?

A

In an Equity TOE:

  • Client
  • Appointment Confirmation
  • Scope of Instruction - Marketing etc.
  • Personal Contacts
  • Fee & Calculation
  • Payment
  • Termination
  • VAT
  • Terms of Business
  • CHP
  • Signatories
67
Q

RICS Compliance for starting a new company?

A 
Inform RICS
Appoint Responsible Principle
Register with RICS
CHP
CPD Management System
Clients Money
PII
Valuations Registration
Training
Succession
RICS annual Return
68
Q

Statutory Requirements for a new company?

A 
Business name
FS 
Companies House
HMRC
Asbestos
Tax
H&S
Equality Act
FS
Bribery and ML
69
Q

Steps to close a practise?

A 
Inform RICS
Inform Clients
Inform Insurance
Return Clients Money
Retain Info for 6 years
Succession Plan
70
Q

In what circumstances is it appropriate to decline an instruction? Can you give me an example of a time you have done this?

A

Conflict - family member at firm in question

71
Q

What can you tell me about the bribery act?

A

What a bribe is - Advantage from a payment/gift
Principles
Offences

72
Q

-What recent CPD have you attended?

A

Future of Valuations - DCF model

73
Q

-What would you do if a client pressured you to change your valuation?

A

Not do it - Would bring my integrity into question

Unless there was new information

74
Q

What is PII?

A

Professional indemnity insurance covers the cost of compensating clients for loss or damage resulting from negligent services or advice provided by a business or an individual.

APC I&F (20 decks)

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