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APC - Autumn 2024 > ETHICS > Flashcards

ETHICS Flashcards

1
Q

What are the three main roles of the RICS?

A
  1. To maintain the highest standards of education and training
  2. To protect consumers through strict regulation
  3. To be the leading sources of information and independent advice on land, property, construction and associated environmental issues
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2
Q

Who is the current president of the RICS?

A

Tina Paillet FRICS

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3
Q

When was the RICS founded?

A

1886

Royal Charter was granted by privy council in 1881

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4
Q

5 benefits of being an RICS member

A
  1. Status - Your professional credentials provide unrivaled client confidence
  2. Recognition - Promotion of your professional excellence to governments and markets
  3. Market Advantage - RICS stats and standards gives you a competitive advantage
  4. Knowledge - International practice standards, professional guidance, CPD and knowledge sharing
  5. Network - Access to professionals worldwide
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5
Q

What are the 5 Rules of Conduct?

A
  1. Honest and act with integrity
  2. Maintain their professional competence
  3. Good-quality and diligent service
  4. Respect and encourage diversity and inclusion
  5. Public interest - maintain public confidence in the profession
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6
Q

What is Rule 1 (RoC)?

A

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

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7
Q

What is Rule 2 (RoC)?

A

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

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8
Q

What is Rule 3 (RoC)?

A

Members and firms must provide a good quality and diligent service

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9
Q

What is Rule 4 (RoC)?

A

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

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10
Q

What is Rule 5 (RoC)?

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 the profession

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11
Q

What is the RICS Decision Tree?

A

A framework of questions available on the RICS website which members should ask themselves when facing a situation in which they are asked to act in a potentially unethical manner or situation.

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12
Q

What are the three levels of disciplinary action in the RICS?

A
  1. Action by Head of Regulation
  2. Disciplinary Panel (drawn from the independent regulatory tribunal)
  3. Appeal Panel
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13
Q

What are the four displinary actions Head of Regulation can initiate?

A
  1. Serve a fixed penalty notice
  2. Make a regulatory compliance order
  3. Refer the matter to a single member of the Regulatory Tribunal for consideration
  4. Refer the matter directly to a disciplinary panel
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14
Q

When would you receive a fixed penalty for a disciplinary?

A

Procedure used for breaches of the Rules relating only to the supply of information to the RICS by firms and members.

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15
Q

When would you receive a Regulatory Compliance Order for disciplinary procedures?

A

For low level breach of the Rules, such as some minor breaches which could be easily corrected.

It’s a written document which states a member or firm must take or desist from taking certain actions in a specific time period, and an agreement to pay a fine.

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16
Q

What happens if a disciplinary procedure is actioned by a disciplinary Panel?

A

For more serious breaches of conduct.
1. Issue a Regulatory Compliance Order

  1. Reprimand (formal expression of disapproval)
  2. Fine
  3. Impose an unlimited amount of fine per breach but it must be proportionate to the offence
  4. Impose condition upon future continued RICS registration
  5. Expulsion from membership or remove a firm
  6. Require publication of the results of the hearing in the RICS Modus Magazine, on the RICS website and in the local newspaper where the firm or member is based.
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17
Q

What is an Appeal Panel in relation to disciplinary procedures?

A

Where you can consider a member of rims appeal against review of a decision relating to the above levels of disciplinary procedure.

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18
Q

What should you consider when negotiating fees?

A
  1. Avoid price fixing, aggressive fee cutting or collusion with competitors
  2. In line with market-based fees
  3. Consider the amount of time and resources required and that you have the appropriate expertise.
  4. You should not be seen to be undercutting another firm
  5. That you are transparent with your client and consumers that you may be in receipt of or offering a referral fee and state this in the ToE
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19
Q

What must be included in your ToE?

A
  1. Must state in writing the client’s agreement to the proposed fee basis
  2. Payment of expenses (and how calculated)
  3. That a copy of the firm’s complaints handling procedure is available upon request
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20
Q

What are the three steps to follow on a new instruction?

A
  1. Check professionally competent
  2. No conflicts of interest or personal interest
  3. Confirm terms of engagement in written and get written approval from the client before you start work on the instruction
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21
Q

For agency work, what legislation do you also need to consider for an instruction?

A

Compliance with Section 18 of the Estates Agents Act 1979 and money laundering checks (Money Laundering Regulations 2018 as amended)

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22
Q

How long is the cooling off period on Terms of Engagement what legislation goes with it?

A

14 days from the date of agreement

The Consumer Rights Act 2015

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23
Q

When would it be appropriate to decline an instruction? 8 options

A
  1. Not competent to undertake the work (outside limitations)
  2. Do not have sufficient facts on the issue
  3. Proposed client will not sign your ToE or complete AML checks
  4. There is a conflict of interest
  5. A professional indemnity insurance liability cap cannot be agreed
  6. Advice is for a friend or on a pro bono basis and your PI will not cover work on a personal basis
  7. The potential client is included in the UK Governments sanctions list
  8. Would you be content for your actions to be made public
24
Q

What is the difference between conflict avoidance and conflict management

A

Conflict avoidance is when you do not accept the instruction

vs

Conflict management which is when the instruction is accepted and steps are agreed and put in place to manage the conflict

25
Q

What would be a step you could put in place for conflict management to reduce the conflict?

A

information / ethical barrier, with the written agreement of all parties

26
Q

What does the RICS Global Professional Standard: Conflicts of Interest 2-18 state?

A

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

27
Q

What is a ‘Party Conflict’

A

A party conflict relates to the work on the same or related instruction for two different parties

28
Q

What is an ‘Own Interest Conflict’

A

An own interest conflict relates to a personal interest

29
Q

What is a ‘confidential information conflict’

A

relates to work between two parties that is confidential

30
Q

How do you handle a conflict of interest?
3 steps

A

STEP ONE: Conflict avoidance
- Consider whether the conflict is irresolvable and whether this can be properly managed
- Decide if you want to accept or decline the instruction from Client A or B

STEP TWO: Written advice to both parties
- Set out in writing as soon as possible disclosing the conflict, clearly and inform that they should seek independent advice if needed and, request written confirmation from both clients with their informed consent

STEP THREE: Conflict Management
- Set up an information barrier in accordance with the provisions agreed with both clients.

31
Q

What is incremental advice? Provide an example

A

Where an agent selling the property is approach by another party to provide advice, for example a valuation, building insurance or planning, relating to the purchase.

The RICS must only provide such incremental advice if consent is given and information barrier is put in place before providing advice to the prospective buyer

32
Q

How long should you hold files of information?

A

A minimum of 6 years before being disposed of and destroyed securely

33
Q

What would would you do if a surveyor finds out a confidential piece of information?

A

The client should be advised of the error and the matter should be recorded in a note to the firm’s compliance officer.

34
Q

What is formal CPD?

A

Includes all forms of structured learning that has clear learning objectives and outcomes.

35
Q

What is informal CPD?

A

Any self-managed learning that is relevant to your professional role.

Example: private reading, training and informal seminars / events

36
Q

Give a case law example of negligence and duty of care

A

Scullion v Bank of Scotland plc (t/a Colleys) (2010)
relates to a breach of the duty of care owed to Mr Scullion in relation to a valuation report prepared for a flat in Cobham. The Court of Appeal held that a surveyor who provides advice on value to a lender in respect of a buy to let purchase does not owe a duty of care to the borrower who is seeking funding to purchase the property.

37
Q

How can you avoid negligence?
6 options

A
  1. Clearly understand the client’s objectives
  2. Ensure you are competent to undertake the instruction
  3. Undertake the work in accordance with the relevant RICS advice, to include Professional Standards and Practice information
  4. Make detailed file notes and take photographs
  5. Keep up to date with market knowledge and legislation
  6. Cap the professional liability excess on your PII policy in the ToE
38
Q

Why do you need Professional Indemnity Insurance? PII

A

To protect clients, surveyors and third parties against negligence claims where there is a duty of care breach and a claim for damages arises

39
Q

If you were starting a new practice, what would you need to do / send to the RICS?

A
  1. Complete a Firm Details Form for the RICS
  2. Appoint a Contact Officer for all RICS communication
  3. Register with the RICS for regulation of the firm
  4. Arrange PII and send details to RICS
  5. Register for RICS Valuer Registration Scheme (if undertaking Red Book Global valuation work)
  6. RICS approval for complaints handling and set up a complaints log and appoint a complaints handling officer
  7. Use a logo kit from the RICS
  8. Ensure CPD logged online on the RICS CPD Management system
  9. Ensure completion of an online RICS Annual Return at the end of each year
40
Q

If you were starting a new practice, what would you need to do / send to the RICS? Statutory compliance

A
  1. Disclose business name
  2. Compliance with:
    Disability discrimination (Equality Act 2010), Financial services, Bribery Act 2010, Money Laundering Regulations 2017, Health and Safety 1974, Asbestos register, Fire Safety Compliance, Data Protection, Estates Agency Compliance
  3. Inform HMRC for VAT and Tax Registration
  4. Ensure compliant with current employment law ( national living wage, working hours etc
41
Q

What is a bribe?

A

A bribe can be the giving, offering, promising or receiving of an advantage such as a payment, gift or a service for an action which is illegal or a breach of trust.

42
Q

What are the four offences of the Bribery Act 2010?

A
  1. Bribing
  2. Recieving a bribe
  3. Bribing a foreign public offical
  4. Failing to prevent bribery
43
Q

What penalty could you get for not complying with the Bribery Act 2010?

A

A maximum penalty of 10 years imprisonment and for an unlimited fine for individuals and companies.

44
Q

What is the definition of money laundering?

A

Money laundering is when proceeds of criminal activities are disguised or converted and then realised and legitimate assets.

45
Q

What is the penalty if you fail to comply with Customer or Enhanced Due Dilligence?

A

Maximum 14 years prison sentence and or unlimited fine for assisting with money laundering
Maximum 5 years prison sentence and or unlimited fine for tipping off a person by informing them that they are under suspicion for money launder or failing to report suspicion

46
Q

If you are asked about the acceptence of any cash, gift or hospitality in your interview, consider the following:

A

Bribery Act 2010
RICS Professional Standard
Organisational Procedures
Professional objectivity, openness and transparency
Proportionality
Sanctions

47
Q

If asked about AML in your interview, consider the following

A

Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017
The RICS Professional Standard
Government Guidance
Due Diligence procedures
Professional objectivity, openness and transparency
Red Flags

48
Q

What are some red flags for money laundering?

A
  • Inability or unwillingness to provide identity documents
  • Changes to parties involves in transactions
  • Unusual transaction features, such as unexpected urgency, potential loss-making
  • Payment of fees, purchase or rental monies in unusual currencies
49
Q

What is the RICS Professional Standard: Countering bribery, corruption, money laundering and terrorist financing 2019

A

Sets out the mandatory, globally acceptable requirements for RICS members and regulated firms in relation to bribery, corruption, money laundering and terrorist financing

50
Q

What are the three main parts of the RICS Professional Standard: Countering bribery, corruption, money laundering and terrorist financing, 2019

A
  1. Mandatory requirements for anti-bribery, corruption, anti-money laundering and terrorist financing
  2. Guidance setting out supporting good practice for the above. EG have a written policy in place, and publish a code of behavior for staff
  3. Supplementary guidance on some of the concepts set out in Parts 1 & 2 EG establish a risk-based approach
51
Q

What are the 9 protected characteristics of the Equality Act 2010?

A
  • gender reassignment
  • sex
  • sexual orientation
  • age
  • disability
  • race
  • religion or belief
  • marriage and partnership
  • pregnancy and maternity
52
Q

In April 2024, the RICS provided further guidance to Rule 4 RoC - what did this include?

A

Actions for firms of different sizes.

Example:
Ensure your offices are more accessible for visitors, challenge behaviour that is exclusionary, diversity your supply chain

53
Q

What is unconscious bias?

A

Relates to the associations we hold which are deeply ingrained and outside our concious awareness or control

54
Q

What are some of the key skills useful for effective team working?

A

Listening to
Discussing
Persuading
Respect
Helping
Sharing
Participating
Communication
Reflection

55
Q

What is an inclusive environment?

A

One which is designed and managed to allow people with a diverse range of need and abilities to access and use it

56
Q

Provide an example that ensures environments are inclusive and applies throughout the property lifecycle

A

During design and / or refurbishment, ensure accessibility is consisted from various users perspectives, physically and socially

APC - Autumn 2024 (9 decks)

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