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APC Revision > Ethics > Flashcards

Ethics Flashcards

1
Q

When was RICS founded?

A

1868

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2
Q

When was RICS granted its Royal Charter?

A

1881

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3
Q

Who granted the RICS Royal Charter?

A

The Privy Council

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4
Q

What sets out the governance of the institution?

A

RICS Regulations and Bye-laws

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5
Q

How many memberships are there?

A

140,000

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6
Q

What are the 4 levels of membership?

A

FRICS, MRICS, AssocRICS, Trainee/Student

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7
Q

To become a fellow, what do you need to provide to the Fellowship assessor?

A

Evidence of achievement of FOUR fellowship characteristics, including: 5 or more years at MRICS, a leadership role, professional/technical achievement, academic achievement or raising the profile of the RICS. A portfolio of achievement to support the application is required to include your CPD record.

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8
Q

Who is the RICS governed by?

A

By various internal councils and boards

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9
Q

How many members are in the Governing Council?

A

20

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10
Q

What is the Governing Councils role?

A

To manage and provide strategic direction

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11
Q

Who reports to the Governing Council?

A

The Standards and Regulation Board and Management Board

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12
Q

How many specialist professional groups are there?

A

17

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13
Q

What is the role of the professional group?

A

To outline standard of competence and practice

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14
Q

Who is the Chief Executive Officer?

A

Justin Youngs

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15
Q

Who is the President of the RICS

A

Tina Paillet FRICS

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16
Q

Who chairs the Governing Council?

A

Tinia Paillet

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17
Q

What are the three main roles of the RICS?

A

To maintain the highest standards of eduction and training; to protect consumers through strict regulation of professional standards; to be the leading source of information and independent advice on land, property, construction and associated enviromental issues

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18
Q

Who carried out the Independent review of internal governance failings within RICS?

A

Alison Levitt QC in 2021

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19
Q

What was the purpose of the Bichard Review?

A

To clarify the purpose of the RICS, including: making recommendations on its governing structure: provide proposals for the incoming leadership and governing body on the future culture and strategy of the Institution

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20
Q

What were the recommendations of the Bichard Review?

A

A quick and phased approach to the adoption of clear responsibilities for governance by key individuals, recruiting a new Management Board and Standards and Regulation Board and holding electrics for key RICS committees and groups

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21
Q

What were the key themes of the Bichard Review?

A

Governance, strategy, people culture and values and member service.

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22
Q

What was the reasoning behind New Governing Council elections?

A

To better reflect the geographical location and disciplines of members

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23
Q

What Panel Chairs have the RICS recruited as part of the new governance structure?

A

Diversity, Equality, Inclusion and Sustainability

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24
Q

What were the 7 key areas of the Bichard Review?

A
  1. Focus on the public interest
  2. Maintain self-regulation through great independence for regulatory functions
    3.Increased focus on diversity and inclusion
  3. Empowering and enabling members through great support for regional boards, increasing engagement for younger members.
  4. Undertaking independent reviews of RICS governance and effectiveness at delivering against its Charter for the punlic advantage once every five years.
  5. A simplified, clear, accountable governance structure.
  6. Showing greater leadership on issues that matter most to society, such as sustainability and climate change.
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25
Q

What are the 5 foundations of the RICS following the Bichard Review?

A
  1. Vision - A natural and built environment that is sustainable, resilient and inclusive for all.
  2. Mission - To inspire members, advance knowledge and uphold standards
  3. Strategic goals - Influence on sustainability, attract a diverse next gen, strengthen trust in the profession, enhance member value and engagement.
  4. Values - Professional, collaborative, inclusive and ambitious.
  5. A world class organisation - an efficient, effective and inspiring professional body.
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26
Q

What are the 5 benefits of being a member?

A
  1. Status
  2. Recognition
  3. Market advantage
  4. Knowledge
  5. Network
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27
Q

Why would firms register to be RICS regulated?

A

As it provides a ‘gold standard’ of quality control for clients and benchmarks for all firms.

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28
Q

How often must firms make a return to the RICS confirming their compliance and obligations?

A

Annually

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29
Q

What is classed as a practice?

A

A corporate body, a partnership, a LLP or sole practitioner

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30
Q

According to the ‘Rules for the regulations of firms’ 2022, what percentage of Principals of a UK firm mean it has to become regulated?

A

50% and at least 25% then it can apply to be regulated

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31
Q

Who are Principals?

A

Sole practitioners, directors, partners, board members or someone who is able to work autonomously (unsupervised)

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32
Q

What is the responsibility of a ‘Responsible Principle’.

A

Someone who is obliged to ensure all reasonable steps are taken and systems are in place to ensure compliance with regulatory and RICS requirements, including to report to RICS as required.

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33
Q

When where the new Rules of Conduct published and when did they become effective?

A

October 2021 and effective Feb 2022

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33
Q

Who deals with disputes regarding the registration of a firm?

A

The Standards and Regulation Board

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34
Q

Who can use the RICS logo?

A

Only RICS members or registered firms

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34
Q

What information is required for registration?

A
  1. Type of business and staffing details
  2. Name of the Responsible Principle
  3. Statutory regulated activities
  4. Nature of clients
  5. Complaints handling procedure and records
  6. Professional indemnity insurance details
  7. If the firm holds clients money
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35
Q

What did the Rules of Conduct 2022 replace?

A

The Rule of Conduct for members and firms and the 5 Global and Ethical Standards

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36
Q

What is Rule 1 of the Rules of Conduct?

A

Members and Firms must be honest, act with integrity and comply with their personal obligations, including obligations to RICS

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37
Q

What is Rule 2 of the Rules of Conduct?

A

Members and Firms must maintain their professional competency and ensure that services are provided by competent individuals who have the necessary expertise.

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38
Q

What is Rule 3 of the Rules of Conduct?

A

Members and Firms must provide a good-quality and diligent service

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39
Q

What is Rule 4 of the Rules of Conduct?

A

Members and Firms must treat others with respect and encourage diversity and inclusion

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40
Q

What is Rule 5 of the Rules of Conduct?

A

Members and firms must act in the public interest, take responsibility for their actions and act to prevent harm and maintain public confidence in their profession.

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41
Q

According to appendix A of the Rules of Conduct (2022), what must members do?

A
  • Comply with the CPD requirements
  • Cooperate with RICS
  • Promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf.
42
Q

According to appendix A of the Rules of Conduct (2022), what must firms do?

A
  • Publish a complaints-handling procedure, including a ADR provider approved by RICS and maintain a complaints log
  • Work is covered by adequate professional indemnity cover that meets the standards approved by the RICS
  • If a Sole Principal, have the appropriate arrangements in place for their professional work if they were to be absent or die.
  • Cooperate with the RICS
  • Promptly provide all information reasonably requested by RICS.
  • Display their business literature, in accordance with the RICS published policy on designations, denoting they are RICS regulated.
  • Report to RICS any matter they are required to report under the Rules for the Registration of Firms.
43
Q

What was the rationale of developing the new Rules of Conduct?

A
  • A simpler structure
  • Clear examples
  • Focusing on respect, diversity and inclusion
  • Understanding evolving technology
  • Tackling global challenges
44
Q

Example behaviour of Rule 1?

A

Not to mislead other by their actions.
Must be open and transparent with clients about their fees and services
Must not take unfair advantage of them

45
Q

Example behaviour of Rule 2?

A

Only undertake work that they have knowledge, skills and resources to carry out competently
Stay up to date and comply with relevant legislation

46
Q

Example behaviour of Rule 3?

A

Understand the clients needs and objectives before accepting any professional work
Agree the clients scope of service to be provided and its limitation and timescales for the work.

47
Q

Example behaviour of Rule 4?

A

Not to bully or harass anyone
Respect the rights of other and treat others with courtesy

48
Q

Example behaviour of Rule 5?

A

Support directors, partners etc who have acted in good faith to report concerns
Respond to complaints against them promptly, openly and professionally.

49
Q

What is the purpose of the Decision Tree?

A

To provide a framework of questions which members should ask themselves when facing a situation in which they are asked to act in a potentially unethical manner or situation

50
Q

What does the Decision Tree encourage?

A

It encourages members to consider the legality of ones actions and their consistency with the Rules of Conduct. The ultimate test is whether they would be content of their decisions being made public.

51
Q

What is the hotline called where members can get assistance on any ethical issue?

A

The RICS Regulation Confidential Hotline

52
Q

What board is responsible for Disciplinary Procedures?

A

The Standards and Regulatory Board

53
Q

Why are Disciplinary Procedures in place?

A

To protect the public, uphold confidence in the profession and uphold professional standards

54
Q

How is a disciplinary procedure triggered?

A

If someone complains to RICS, an allegation by a client or because of information received or established by the RICS

55
Q

What does the RICS Regulatory Decision Making 2022 set out?

A

It sets out an outline of the regulatory approach by RICS of regulated members, non-members and firms.

56
Q

Where is the disciplinary process set out in?

A

RICS Regulatory Tribunal Rules 2022

57
Q

What are the three levels of disciplinary action?

A
  1. Action by the Head of Regulation
  2. Disciplinary Panel (drawn from the independent Regulatory Tribunal)
  3. Appeal Panel
58
Q

What actions can the Head of Regulation make?

A
  1. Serve a fixed penalty notice
  2. Make a regulatory compliance order
  3. Refer it to a single member of the Regulatory Tribunal for consideration
  4. Refer the matter directly to the Disciplinary Panel
59
Q

What is a regulatory compliance order?

A

A written document which states the terms upon a member must take or not do in a specified time period, and an agreement to pay a fine. It is for low level breaches i.e non compliance with RICS rules such as CPD.

60
Q

When is action by a disciplinary panel used?

A

For more serious breaches of conduct

61
Q

What are the penalties available to a Regulatory Tribunal Disciplinary Panel?

A
  1. Issues a Regulatory Compliance Order
  2. Reprimand
  3. Fine
  4. Unlimited amount of fine
  5. Impose conditions upon future continued RICS registration
  6. Expulsion
  7. Require publication of results from hearing in RICS Modus Magazine.
62
Q

What does an appeal panel do?

A

It can consider a members or firms appeal against review of a decision relating to the other disciplinary procedures. Will look at new evidence. The panel will include lay members.

63
Q

What guidance is used for social media

A

Use of social media: Guidance for RICS members 2021

64
Q

When will the RICS investigate concerns about a media post

A

If it discriminates, dishonest, abusive, bullying etc

65
Q

When will the RICS take disciplinary action on a social media post

A

If it’s felt that a post may damage public confidence and trust in the profession, therefore disciplinary action is taken to protect the public

66
Q

What new category of core material is replacing the Professional statements and Guidance notes

A

Professional standards

67
Q

What are RICS professional Standards?

A

They are a set of requirements or expectations for RICS members and regulated firms about how they provide services or the outcomes of their actions

68
Q

When is a requirement known to be mandatory in the professional standards

A

When the word must is used

69
Q

What is the RICS Practice information

A

Information to support your practice, knowledge and performance of RICS members and regulated firms. They can include good practice, insights and processes. They do not contain advice.

70
Q

What are RICS Practice Alerts

A

They are key tools for warning or alerting the profession to emerging areas of risk which the RICS concerns. It was established in Jan 2023. Examples are Expert Witness

71
Q

On fees negotiations what should you not do

A

price fixing, aggressive fee cutting or collusion with competitors

72
Q

On fee negotiations what should you do

A

Should be market based and agreed on an ad hoc basis with clients

73
Q

What should you consider when granting or accepting a referral fee

A

The Bribery Act 2010 and Rules of Conduct

74
Q

What do terms of engagements include?

A

The client’s name, address and appropriate contact details, the RICS members name and contact details, subject properties address and postcode, the nature and type of service required, and the nature and intended future use of the property

75
Q

What are terms of engagement?

A

They state in writing the clients agreement to the proposed fee basis, payment of expenses and a copy of the firms complaints handling procedure if requested.

76
Q

What are the three steps of terms of engagement?

A
  1. Check professionally competent
  2. No conflicts of interest or personal interest
  3. Confirm terms of engagement in writing before starting on the instruction (CIT)
77
Q

What laws do the terms of engagement need to comply with?

A

S18 of the Estate Agents Act 1979, Money Laundering Regulations 2017 and Consumer Rights At 2015.

78
Q

When would you decline an instruction?

A

Not competent to undertake the work, you don’t have sufficient facts on the issue, conflict of interest, advice is for a friend.

79
Q

What is a conflict of interest?

A

It arises when a member or firm’s independence and impartiality is threatened due to the existence of a conflict between two clients. Examples include: Any financial interest, a personal interest, acting on both sides of a transaction.

80
Q

What is conflict avoidance?

A

When you do not accept the instruction

81
Q

What is conflict management?

A

It is when the instruction is accepted, and steps are agreed and put in place to manage conflict, such as information/ethical barrier, with written agreement of all parties

82
Q

What document provides guidance on Conflict of Interest?

A

The RICS Professional Standard on Conflicts of Interest 2017

83
Q

What does the RICS Professional Standard on Conflicts of Interest 2017 state?

A

That a member must not advise or represent a client where doing so would involve a conflict of interest or a significant risk of a conflict of interest, other than where all those who are, or may be affected have provided their informed consent.

84
Q

When can Informed Consent be sought?

A

Where the RICS member or regulated firm is satisfied that proceeding despite a conflict of interest is in the interests of all those who are or may be affected and is not prohibited by law.

85
Q

What are the three types of conflict or interest?

A
  1. Party Conflict
  2. Own interest Conflict
  3. A Confidential Information Conflict
86
Q

What is a party conflict?

A

A situation in which the duty to act in the interests of a client or other party in a professional assignment conflicts with a duty owed to another client or party in relation to the same or a related professional assignment.

87
Q

What is an Own Interest Conflict

A

It relates to a personal interest and arises when acting for a family member or someone you have a personal or financial interest. Must not interfere with professional judgement. Declare facts in writing before accepting the instruction.

88
Q

What is a Confidential Information Conflict

A

A conflict between the duty of an RICS member to provide material information to one client, and the duty of that RICS member to another client to keep that same information confidential.

89
Q

What is informed consent?

A

Informed consent occurs when a party who might be adversely affected by a conflict of interest acknowledges the existence of that risk but still agrees to instruct an RICS- regulated firm or RICS member to proceed with the assignment.

90
Q

When should informed consent be used?

A

If the RICS surveyor is satisfied that all relevant parties are best served by doing so.

91
Q

What should firms put in place when managing Conflict of Interests?

A

All conflicts must be managed in accordance with the Professional Standard.
Every RICS firm must have in place an effective system and and controls appropriate to the size and complexity of the business to ensure full compliance.
All firms must keep a record to show their compliance with the standard.

92
Q

What is the three step process when a conflict of interest arises?

A
  1. Conflict avoidance - upon full receipt of all the facts, consider if the conflict is irresolvable because of your impartiality is compromised and should be avoided. Or if it can be properly managed through transparency and openess. Decide to accept or decline.
  2. Written Advice to both parties - disclose the nature of the conflict, circumstances surrounding it and set out proposals for how the firms intends to deal with the conflict i.e. information/ethical barrier. Be as clear as poss, ensuring both parties make a decision (advise they can seek independent advice). Request written confirmation from both with their informed consent.
  3. Conflict management - After receiving informed consent, set up an information barrier in accordance with the provisions agreed with both clients.
93
Q

Explain how information/ethical barriers work

A

They must be robust enough to offer no chance of information passing between the two parties.
Take ‘reasonable steps’ to operate an effective barrier.
The surveyors acting on the two sides must be different and must be physically separated ie. different buildings or floors.
Info securely stored.
Keep an audit trail of the conflict check process and all written and oral comms. The firms compliance officer must oversee all actions.

94
Q

What is dual agency?

A

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

95
Q

What Professional statement deals with dual agency and multiple introductions?

A

Conflicts of interest - UK commercial property market investment agency 2017

96
Q

What does ‘multiple introductions’ mean?

A

where an agent has competing contractual relationships simultaneously with several buyers for commercial real estate investment opportunities. Must state if they are exclusive or non exclusive.

97
Q

What is incremental advice?

A

where an agent is approached by another party to provide advice, i.e planning advice, related to a disposal that is incremental to an existing instruction. Only ok if consent is given and an information barrier is in place before providing any incremental advice.

98
Q

What is the S21 of Estate Agents Act 1979?

A

You must declare any personal interest, as defined in section 21 of the Estate Agents Act, you or a connected person have in a transaction. Do this as soon as you can, in writing. A connected person can be: your employer or principal.

99
Q

What do RICS bye-laws state regarding confidentiality?

A

Client confidentiality must be maintained for all client affairs, including historic information and information provided by a client prior to instruction.

100
Q

How long should old files be held for?

A

A minimum of 6 years

101
Q

What do you need if a third party wants access to your files (if they arent HMRC or the police)?

A

Clients approval

102
Q

What do you do if you receive any confidential information in error?

A

Dispose of securely and advise the seller and client of error. The matter should be recorded in a note to the firms compliance officer.

103
Q

What does APC mean

A

Assessment of Professional Competence

APC Revision (13 decks)

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