Ethics Flashcards
What RICS guidance is there on ethics?
Rules of Conduct 2021, effective 2 February 2022
What are the ROC
Rule 1: Be honest, act with integrity and comply with their professional obligations and their obligations to the RICS. Refers to the bribery act and conflicts of interest.
Rule 2: Maintain their professional competence and ensure that services are carried out by competent individuals who have the necessary expertise. Ensure they are competent to carry out work and that subcontractors are competent.
Rule 3: Provide good quality and diligent services. Understanding the clients Scope of works and ensure that detailed documentation/records are kept.
Rule 4: Treat others with respect and encourage diversity and inclusion. Everyone is treated fairly and eliminate any instance of discrimination. Sexual orientation, age, gender, race religion. No tolerance against bullying.
Rule 5: Act in the public, take responsibility for their actions and act to prevent harm and maintain public confidence in the profession. Question practices that don’t seem correct. Do not undermine the profession, ensure complaints are handled promptly and professionally. Would I be comfy if it was made public?
Why did the previous Rules of Conduct Change?
- The previous rules were in place since 2007
- Following research and consultation wit REIC embers and the public. Majority voted in favour to replace existing rules of conduct and separate global professional and ethical standards.
- Provide a single document and clearer examples. Includes technology and climate change.
What are the professional obligations of Members?
- Comply with CPD requirement. 20 hours, 10 must be formal.
- Cooperate with the RICS
- Promptly provide all information as requested by the Standards and Regulations board, or those exercising delegated authority on its behalf.
What are the professional obligations of Firms?
- Publish a CHP and include an alternative dispute resolution and complaints log.
- Have the necessary PII cover and runoff cover.
- Have a Locum in place in the case of death, incapacitation, unable to work.
- Cooperate with the RICS
- Promptly provide all information as requested by the standards and Regulation board, or those exercising delegated authority on its behalf.
- Display their business literature, in accordance with the RICS publish policy on designations, a designation to denote that they are regulated by RICS.
- Report to RICS any Matter that they are required to report under the Rules for the Registration of Firms.
How do you make an ethical decision?
- Consider the facts
- Identify relevant standards
- Use your professional judgement
- Record our decision
RICS Leadership team?
- President – Justin Sullivan
- President Elect – Nick Maclean
- Senior Vice president – Maureen Ehrenberg
- Chief Executive - Justin Young
RICS Motto:
Est Modus in Rebus
What is the RICS Mission statement?
- To qualify and equip their member to offer the highest standards of professional service,
- To promote and enforce standards.
- To lead solutions to the major challenges facing the built environment through professional expertise.
When was the RICS Founded?
1868
When did the RICS get its chartership and by who?
1881 by the Privy council
What are the Regulations?
- The regulations add further detail to the bye-laws and set out the difference classes of membership and contain further details of when fees are payable etc.
- There are 10 regulations in total
What are the Bye-laws?
- The bye-laws are set out by the Royal Charter and determine how the RICS is regulated.
- There are 10 Bye-Laws. E.g. Bye-Law 4 “Contribution to Funds” grants that the Governing Council are able to set annual subscription fees
What are the Five Principles of Better Regulation? PACTT
- Proportionality
- Accountability
- Consistency
- Targeting
- Transparency
What are the benefits of being a RICS member?
- Status – ensures confidence to the clients.
- Recognition – promotion of professional excellence
- Market advantage – Status give competitors advantage
- Knowledge – Provides international practice standards and guidance notes
- Network – over 135000 Members
What are the benefits of regulations and the rules of conduct? CPS
- Confidence – for client
- Professionalism – Firms will provide clear impartial and expert advise
- Security – Firms have CHP and PII
Why have rules of conduct?
They provide a framework to work towards so clients know what level of service they are getting by a RICS member/firm. They provide a professional guide for individuals to follow.
What is the process for setting up a Practice?
- Inform the RICS and obtain a company start up pack
- Inform the RICS and register for regulation
- Appoint a contact officer
- Form a CHP
- Obtain PII
- Set up a client account and procedure of handling client money
- Arrange CPD and training for staff
- Use the designation Regulated by RICS on all practice material
What information do registered firms need to send to the RICS annually?
- Annual return which is carried out online.
- Failure to do so will lead to fixed penalties.
- Include:
o Type of business and staffing
o Nature of Clients
o Training provision
o PI insurance datils
o Whether the firm holds clients money
o Complaints Handling Procedure
What does Handling Clients Money 2019 entail?
*Accounting system and data must be secure
*Money must be kept in client account with Client included in the name
*Client must have access to the funds on demand
*Agree terms and provide bank details to client
*Account must not go into overdraft
*Maintain client ledgers and provide running balance.
What RIC guidance is there on handling clients money?
Client money handling 2019 - PS
What is your companies Complaints handling Procedure?
RICS
* Stage 1
* Acknowledge the complaint
* Handled by senior or designated person
* Stage 2 - promoted to redress panel independent
* Must be recorded
* Advise pi insurer
* See RICS approved third party redress panel
* See RICS Guidance Note ‘Complaints Handling’
HDWE
1. Acknowledge within 2 days.
2. Log the complaint and inform manager.
3. Respond within 5 days.
4. Report to manager to deal with.
5. Report to exco to deal with.
6. Redress scheme
7. Ombudsman
What is the process for Closing down a practice?
- Inform the client and the RICS
- Return any client money held
- Inform PII and activate run off cover
- Keep records for 6 years
What are the main principles of the bribery Act 2018?
- Proportionate procedure
- Top level Commitment
- Risk Assessments
- Due Diligence
- Communication
- Monitor and review
What are the offences of the Bribery Act?
- Making a bribe
- Accepting a bribe
- Failure to prevent a bribe
- Bribing a foreign official
What are Professional statement?
Mandatory
Statement Conflict of Interest 2017
What are Guidance notes?
They are voluntary and promote best practice:
*Surveying Safely 2018
*Comparable evidence in real estate valuation 2019
What is the RICS statement on conflict of interest?
RICS Professional Statement Conflict of Interest 2017 – Mandatory
What is the RICS note on CHP?
RICS Guidance Notes Complaints handling 2016
What is the RICS note on PII?
RICS Guidance Notes, PII, Risk, Uncertainty and Insurance valuation Work 2018
What are the principles of Money Laundering REgluation2017?
the MLR 2017 set out additional obligations of private sector firms working in area of higher money risk. they aim to stop criminals using professional services to launder money by requiring professionals to take a risk base approach.
What are the principles of GDPR?
- Lawfulness, fairness, transparency
- Purpose limitation
- Data minimisation
- Accuracy
- Storage limitation
- Integrity and confidentiality
- Accountability
What is a fixed penalty?
An administration fine issued by the RICS when a regulated member fails to provide them with information requested by the RICS
A procedure for breaches of the rules relating only to the supply of information to the RICS.
What are the RICS By-Laws
- Application and definitions
- Membership and registration
- Designations
- Contributions and funds
- CONDUCT
- Governing council officer and staff
- Subordinate boards, committees and groups
- Procedure for general meetings
- Accounts and Audits
- General
What is the role of the RICS?
- Maintain the highest standards of Education and training
- To Protect customers through strict regulations of professional standards
- To be leading source of information and independent advise real estate issues.
What are the 5 benefits of being a RICS member SRANK
- Status
- Recognition
- Market advantage
- Knowledge
- Network
What are the three benefits of regulation for firms?
CPS
1. Confidence
2. Professionalism
3. Security
Why do you want to be part of the RICS?
Gives you access to highly regarding individuals globally, provides me with the status and recognition with clients to be trusted and commitment to continues learning.
Tell me about a time you have shown integrity?
Rule 1 - I was invited to a sporting fixture by a contractor which I politely declined as I had an open tender with them.
What does integrity mean to you?
Being honest and having strong morals
Tell me about a time you have encouraged diversity and inclusion?
Rule 4 - When working within my team, I make sure everyone feels included and can share their opinion before making a decision
Tell me about when you promoted trust in the profession?
Rule 5 - during an inspection I noticed a defect with the neighbouring properties roof tile. I photographed it and made a note in my report, following this I contacted the owner of the property and reported the defect.
Tell me how you have treated other with respect?
Rule 4 - I treat everyone I work/interact with the same being colleagues, contractors or tenants.
Tell me about a time you have taken responsibility?
When ever I do a site inspection, I take the responsibility to ensure that all compliance is up to date within the property and if something is out of date or needs actioning I ensure this is actioned once I return to the office.
Tell me about how you have demonstrated two of the 5 Rule of Conduct on your case study?
Rule 3 - I provided good quality and diligent service by ensuring the clients scope and objectives were met.
Rule 5 - I took responsibility and acted promptly when the ceiling was damaged and provided a temporary solution with the plan to rectify the issue correctly and in a timely manner.
What would you do if you had an ethical situation that you didn’t know how to deal with?
I would refer to the RICS ethical decision tree, ensure I have enough information to make my decision, I would consult with a senior staff member and contact the RICS confidential helpline.
Final question I would as is ‘would I want my actions made public?’
What are the obligations of a RICS Member?
- 20 hour CPD reequipments annually, min 10 formal
- Comply with the RICS
- Promptly provide information as reasonable requested by the RICCS or those acting on their authority.
What are the RICS obligations for FIRMS
- Have a CPH, ADR redress scheme approved by the RICS and complaints log
- Have the necessary PII and run off cover
- Promptly provide information as reasonable requested by the standards and regulations board or those acting on its authority.
- Comply with the RICS
- as a sole practitioner, ensure the necessary cover in the chance of death, incapacitation. have a LOCUM in place.
- display in accordance with the RICS on business literature
- Report any matter required to report to to the RICS
Tell me about a conflict of interest you have experienced and how was it avoided or managed?
Working at KFH friends of mine rented a property in the portfolio I was manging. I AVOIDED the personal conflict of interest by requesting to have the property managed by another property manager.
Why was this a conflict of interest?
This was a personal conflict of interest as it would have put me in a situation where I could not act in the best interest for my client and favour the outcome for the tenants.
When a conflict of interest arises, what are the steps you follow?
Step 1: Conflict avoidance - after revising all the facts of the situation you can decide whether you want to accept or decline the instruction.
Step 2: Inform both parties of the COI and receive signed informed consent from both parties.
Step 3: Conflict management - set up information and physical barriers in accordance with the agreed terms.
What are the terms you can decline an instruction?
- I do not have the competence, training or experience.
- There is a conflict of interest
- the client refused to sign the ToE
Name some Professional Statements.
- Property Measurement, 2018
- Countering Bribery, Corruption, money laundry and Terrorist financing, 2019
- Real Estate Management 2016
- UK Residentials Real Estate 2017 (Blue Book)
Name some Guidance notes
- Surveying Safely 2018
- Asbestos: Legal requirement and best practice for property professionals and clients, 2021
- Comparable evidence in real estate valuation 2019
What legislation is in place for anti-bribery?
The Bribery Act 2010 which came in the force July 201
What are the two level of due diligence?
Customer due diligence
Enhanced Due diligence
What is the relevant Professional statement for bribery?
Countering Bribery, corruption, Money Laundering and Terrorist Financing 2019
Part 1: Bribery and Corruption
Part 2: Guidance
Part 3: Supplementary Guidance
What is Money Launderying?
When proceeds of criminal activity are disguised or converted into legitimate income revenue streams.
Would you accept a bottle of wine over Christmas period?
I do not typically accept gifts, however if I were to accept the gift I would check the proportionality, timing monitory value and would register it in the companies gift register. Then the gift would go into the company raffle.
Who is your duty of care highest to?
The Client
What is PII and what are the different stages of cover?
Professional Indemnity Insurance: protects clients, surveyors and third parties against negligence claims
Min requirements based on turnover of firm:
£100K or less = £250K
£100,001K-£200K = £500K
£200,001 + = £1m
Guidance Note - Risk, Liability and Insurance 2021
is PII required to carry out work for charity and friends?
Yes, it is always required
What are the steps you should follow when issuing ToE
- Check your Competence
- Independence - COI
- ToE - have agreed and signed ToE
What is needed in ToE
- Date
- Client
- Property
- Fees
- Expenses
- CHP
- COI check
- PII
How might negligence claims be avoided?
- Ensure you are competent to carry out the works.
- Have clear scope of works and ensure you have property record of all communicational and documents.
- Ensure you do not rush or overload yourself with work.
- keep up to date with market knowledge and legislation.
You Pass your APC and someone asks you to carry out a Valuation for them, can you proceed with their request?
No as this would be outside my level of expertise and I would refer them to the RICS website, find a surveyor.
What is the maximum amount of Cash you can accept?
10,00 Euros
Can you tell me anything recent the RICS has been in the news for?
Renters Rights Bill - abolishing of the section 21 (no fault evictions)
What recent changes has the RICS undergone?
RICS Valuation - Global standards which came into affect on 31 Jan 2025
What is the Max level of uninsured excess required by the RICS
The greater of 2.5% of the insured sum or £10,000
What would you do to set up a new practice?
- informed the RICS and request New starter forms.
- Register for regulation
- Set up a CHP and RICS approved ADR
- PII and run off cover
- Client money and AML due Diligence
- designation
- appoint a responsible person for communication to RICS
- appoint a LOCUM
- Ensure compliance with annual returns to RICS
How would you close a practice?
- inform the RICS and Clients of closure
- Return client monies
- Activate run-off cover
- hold client info for mind 6 years
