Ethics, Rules of Conduct and Professionalism Flashcards
What do the new Rules of Conduct replace?
Rules of Conduct for Members
Rules of Conduct for Firms
Global Professional and Ethical Standards
Why do we have Rules of Conduct?
These Rules set out the standards of professional conduct and practice expected of members and firms registered for regulation by RICS.
What is the definition of Ethics?
Being ethical means conforming to accepted moral standards.
An ethical person has a higher standard than just avoiding a certain behaviour or practice because it is illegal.
What is the Royal Charter and when was it granted?
The Royal Charter 1881 A ‘Grant’ issued by the Monarch, to maintain and promote the usefulness of the profession for the public advantage in the United Kingdom and worldwide.
What might happen if a Member contravenes the Rules?
Caution
Conditions
Fine
Expulsion
Removal of Registration
How many Bye Laws and Regulations are there?
10 Bye Laws - ratified by UK Privy Council
10 Regulations - Approved by RICS Governing Council
How is the institution structured?
- Privy council at the top which grants and awards the royal charter.
- Beneath his you have the Governing Council
- Beneath that you have the Standards and regulation board and regulatory tribunal and the RICS board.
- Under the RICS board you have the Audit, Risk Assurance and Finance Committee, the Nomination and Renumeration Committee and the World Regional Boards and Market Advisory Panels
Which of the 10 Bye Laws and Regulations do the Rules of Conduct sit under?
Rule 5 of the Bye Laws and Rule 5 of the Regulations.
What are the Rules of Conduct?
Rule 1 - Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.
Rule 2 - Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.
Rule 3 - Members and firms must provide good-quality and diligent service.
Rule 4 - Members and firms must treat others with respect and encourage diversity and inclusion.
Rule 5 - 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.
Provide 3 example behaviours of Rule 1 of the RICS Rules of Conduct
1.6 Members and firms are open and transparent with clients about their fees and services.
1.7 Members and firms act to prevent others being misled about their professional opinion.
1.8 Members and firms do not take unfair advantage of others.
Members and firms identify actual and potential conflicts of interest throughout a professional assignment and do not provide advice or services where a conflict of interest or a significant risk of one arises, unless they do so in accordance with the current edition of Conflicts of interest, RICS professional statement.
Firms have effective processes to identify actual and potential conflicts of interest, to enable appropriate decisions to be made on whether to accept work, and to keep records of decisions made about actual and potential conflicts of interest.
Members and firms do not allow themselves to be influenced improperly by others (as a result of, for example, giving or receiving work referrals, gifts, hospitality or payments) or by their own selfinterest.
Provide 3 example behaviours of Rule 2 of the RICS Rules of Conduct
- Members and firms only undertake work that they have the knowledge, skills and resources to carry out competently.
- Members and firms supervise any employees undertaking work for them and ensure that these employees have the necessary knowledge, skills and resources to do their tasks competently.
- Members and firms check that subcontractors have the necessary knowledge, skills and resources to do their tasks competently.
Provide 3 example behaviours of Rule 3 of the RICS Rules of Conduct
3.1 Members and firms understand clients’ needs and objectives before accepting any professional work.
3.7 Members and firms communicate with clients and others clearly and in a way they can understand.
3.11 Members and firms understand the risks and benefits of using relevant technology.
Provide 3 example behaviours of Rule 4 of the RICS Rules of Conduct
- Members and firms respect the rights of others and treat others with courtesy.
- Members and firms treat everyone fairly and do not discriminate against anyone on any improper grounds, including age, disability, gender reassignment, marriage or civil partnership, pregnancy or maternity, race, religion or belief, sex or sexual orientation.
- Members and firms do not bully, victimise or harass anyone.
Provide 3 example behaviours of Rule 5 of the RICS Rules of Conduct
5.3 Members and firms ensure that public statements made by the firm, or in which members are (or could be) identified as members of the profession, do not undermine public confidence in the profession.
5.4 Members and firms respond to complaints made against them promptly, openly and professionally.
5.5 Members and firms do not dissuade complainants from approaching an alternative dispute resolution provider, RICS or any other regulatory body.
What are the core professional obligations for members and firms?
Members:
- Members must comply with the CPD requirements set by RICS.
- Members must cooperate with RICS.
- Members must promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf.
Firms:
- Firms must publish a complaints-handling procedure, which includes an alternative dispute resolution provider approved by RICS, and maintain a complaints log.
- Firms must ensure that all previous and current professional work is covered by adequate and appropriate professional indemnity cover that meets the standards approved by RICS.
- Firms with a sole principal must make appropriate arrangements for their professional work to continue in the event of their incapacity, death, absence from or inability to work.
- Firms must cooperate with RICS.
- Firms must promptly provide all information reasonably requested by the Standards and Regulation Board, or those exercising delegated authority on its behalf.
- Firms must display on their business literature, in accordance with RICS’ published policy on designations, a designation to denote that they are regulated by RICS.
- Firms must report to RICS any matter that they are required to report under the Rules for the Registration of Firms.
What things do you need to consider as a sole practitioner?
Professional obligations of firms point 3 - Firms with a sole principal must make appropriate arrangements for their professional work to continue in the event of their incapacity, death, absence from or inability to work.
Can do this in the form of a locum agreement.
Why were the Rules of Conduct replaced?
The Rules of Conduct were replaced following a consultation with RICS members to provide a single document with greater clarity. There is now greater clarity on example behaviours.
When did the Rules of Conduct come into place?
02/02/2022
What is the RICS moto?
Est modus in rebus / there is measure in all things.
When was the RICS founded?
1868
When was the Royal Charter granted?
1881 by the Privy Council
Tell me about RICS’ CPD policy
- All members must undertake a minimum of 20 hours CPD each calendar year (January to December).
- Of the 20 hours at least 10 hours must be formal CPD. The remainder can be informal CPD.
- All members must maintain a relevant and current understanding of our professional and ethical standards during a rolling three-year period. Any learning undertaken in order to meet this requirement may count as formal CPD.
- Members must record their CPD activity online by 31 January.
What would you need to do if you were setting up a new firm tomorrow?
- Follow the RICS Rules for Registration of Firms.
- Inform the RICS and register for Regulation.
- Prepare a complaints handling procedure.
- Obtain adequate and appropriate professional indemnity cover.
- Abide by the Rules of Conduct.
- Follow the Rules for the use of the RICS logo and designation by firms.
What insurances does a RICS firm need to consider?
- Professional indemnity insurance
- Employers liability
- Public liability
- Buildings insurance for their premises.
What do you know about the annual returns required by RICS regulated firms?
- Must be carried out on line.
- Failure to complete them leads to a fixed penalty.
- The annual return includes, type of business and staffing; nature of clients; training provision; complaints handling procedures, details and records; PI insurance details; whether the firms holds client’s money.
What is the RICS policy of complaints handling?
- RICS Professional Standard - Complaints Handling
- Firms must publish a complaints-handling procedure, which includes an alternative dispute resolution provider approved by RICS, and maintain a complaints log.
- The management of complaints must be undertaken in accordance with the specific terms of the current PII policy.
- Complaint must be acknowledged within 21 days.
- 2 stage process:
1. Consideration of the complaint by a complaints handling officer (free of charge)
2. If the issue is not resolved, the complaint is referred to an independent third party (complainant may be expected to contribute towards costs)
What are the PII requirements?
RICS Regulation - UK professional indemnity insurance requirements
- Each and every claims basis (i.e. the insurance customer is entitled to the full limit of indemnity for every claim made)
- the policy at the time that the breach was discovered is responsible not the policy at the time where the breach was made.
- Must provide cover for all past and present employees, including all partners, directors, members and employees
- Fire safety exclusions will not apply to professional work relating to buildings four storeys or under.
- There are additional requirements for all RICS firms that conduct general insurance distribution work and are required to be registered with the Financial Conduct Authority or RICS’ Designated Professional Body scheme.
What is the purpose of PII cover?
To provide financial cover in the event that a client suffers financial loss as a result of a breach of professional duty, e.g. negligence, errors or omissions.
What are the minimum levels of indemnity for PII Cover?
- Minimum levels of indemnity =
Where the firm’s turnover in the preceding year = £100,000 or less the minimum level of indemnity is £250,000
£100,001 to £200,000 = £500,000
£200,001 and above = £1,000,000
What is the maximum uninsured excess for PII cover?
- Maximum uninsured excess (the part of each claim the firm must pay itself)
Where the firms turnover is £10,000,000 or less the maximum uninsured excess is the greater of 2.5% of the sum insured, or £10,000.
Where it’s £10,000,001 and above there is no limit set.
What is the purpose of run off cover?
- To ensure that firms, members and their clients are not exposed to financial detriment in the period following a firm ceasing to trade.
What are the minimum policy requirements for run off cover?
For consumer claims:
- A limit of £1,000,000 in all for a period of six years from the expiry date of the policy in force at the time of cessation. If on an each and every claims basis this should be maintained for a minimum period of six-years from the cessation of the practice.
For non-consumer claims:
- Maintained for a minimum period of six years from the cessation of the practice.
What is a run off pool?
Firms that are unable to obtain run-off from their incumbent insurer or the open market will be able to apply for coverage to the run-off Pool.
What are the requirements of members in relation to client money handling?
- Comply with the RICS professional standard - client money handling.
Members must:
1. Ensure compliance with all anti-money laundering legislation for all receipts of client money
2. Ensure compliance with the mandatory requirements of the latest edition of RICS’ Countering bribery and corruption, money laundering and terrorist financing
3. Follow all of their companies procedures for handling client money
4. Must not override any controls in place to protect client money
5. Disclose any risk of or actual misappropriation of client money to a senior member of the firm and to keep a written record of that disclosure.
What are the objectives of the RICS professional standard - client money handling?
Ensure that:
- Client money is kept safe
- Client money accounts are used for appropriate purposes only and
- RICS-regulated firms have the appropriate controls and procedures to safeguard client money
What are the requirements of firms in relation to holding client money?
RICS Regulated firms that operate a client must:
1. set clear segregation of the duties for employees.
2. have a principle oversee the client money accounting functions.
3. principles cannot override controls.
4 . Ensure that competent and knowledgeable staff process client money and provide cover for long term absence.
5. Accounting systems and data must be secure.
6.Client money must be kept separate with the word client included in the bank name
7. clients must always have access to funds.
8. we must agree the terms and advise the client on the bank details.
9. the account must not be overdrawn
10. we must maintain client ledgers and provide a running balance.
What is Brown & Co’s complaints handling procedure?
Brown & Co’s complaints handling procedure:
- Ask complainant to put complaint in writing if not already done so.
- Acknowledge complaint within 3 working days.
- Notify offices complaints handler (Nathan Roe) if haven’t complained to Nathan directly.
- Aim to deal with and resolve complaint within fifteen working days – advise complainant of the outcome of the investigation into the matter and to let them know what actions have been or will be taken.
- If dissatisfied complaint can be refer to The Property Redress Scheme (for consumer clients) or for business clients, The Centre for Effective Dispute Resolution.
What should be included in your organisation’s complaints handling procedure?
Any CHP should include the following as a minimum:
- Information about who the appointed person within the firm is who deals with complaints.
- A request that complaints are made in writing.
- The stages of the CHP.
- The timescale for considering the complaint within the firm.
What are the qualities of an effective complaints handling procedure?
- Be fit for purpose – it should reflect the size and structure of the business
- Made available to all staff – a CHP is intended to provide clarity and consistency to staff and clients
- Be understood by all staff – keep records of staff training
- Readily be shared with complainants or potential complainants – supplying them with a copy should be routine
- Be regularly reviewed at a senior level – record evidence of review, to include reviewer details and review date
- Be agreed with PII brokers/provider(s) – the CHP should reflect processes that do not compromise PII cover and
- Provide details of access to independent redress if the firm cannot resolve the complaint.
What are the requirements of firms in relation to bribery and corruption?
RICS Professional Standard – Countering bribery, corruption, money laundering and terrorist financing
In relation to bribery and corruption RICS-regulated firms must:
1. Not offer or accept, directly or indirectly, anything that could constitute a bribe
2. Have plans in place to comply with applicable laws governing bribery and corruption, and ensure that these are followed
3. Report any activity they are aware of that breaches anti-bribery and corruption laws to the relevant authorities (where there is no local legislation the activity should be recorded and, if possible, reported to a senior manager)
4. Act with due diligence to perform periodic written evaluations of the risks that face the firm and that may lead to the facilitation of bribery or corruption
5. Retain information detailing how the firm has met the requirements of this professional standard.
What are the requirements of members in relation to bribery and corruption?
RICS Professional Standard – Countering bribery, corruption, money laundering and terrorist financing
In relation to bribery and corruption RICS members must:
1. Not offer or accept, directly or indirectly, anything that could constitute a bribe
2. Ensure that they have adequate knowledge of bribery and corruption to be able to comply with the requirements of the professional standard
3. Report any activity they are aware of that breaches applicable anti-bribery and corruption laws to the relevant authorities (where there is no local legislation the activity should be recorded and, if possible, reported to a senior manager)
What are the RICS Bye-Laws
- Application and definitions
- Membership and registration
- Designations
- Contributions to funds
- Conduct
- Governing council, officers and staff
- Subordinate boards, committees and groups
- Procedure for general meetings
- Accounts and audit
- General
Provide examples of what firms should do in relation to bribery and corruption
- Encourage transparency within the organisation by implementing a gift register for gifts hospitality, entertainment etc.
- Publish a code of behaviour and provide this to staff
- Provide clear guidance for staff so that they understand their role in preventing bribery and corruption
Provide examples of what members should do in relation to bribery and corruption
- Declare items on the gift register, e.g. gifts, hospitality, entertainment etc.
- Attend relevant training provided by their employer or a regulator addressing bribery and corruption
- Act in compliance with their employer’s policy relating to bribery and corruption.
If you are successful in undertaking a project for a client and they send you a case of wine as a thank you, what should you do?
- Consider whether the gift is proportionate, timely and wouldn’t introduce a future conflict of interest?
- If it was at the end of the project and the gift was less than £30 I could accept as long as I declare it on my company’s gift register.
What is the difference between a gift and a bribe?
Gift = something given willingly to someone without payment in return. Given with no intent to influence or change someone’s mind.
Bribe = The offer, promise, giving, demanding or acceptance of an advantage as an inducement for an action that is illegal, unethical or a breach of trust.
You mentioned that you declined to attend a corporate hospitality event with a contractor who had recently submitted a tender –
What made you decline the invitation?
The invitation was not timely due to the tender process still being open and this could have been seen to influence my decision.
What is the legislation around bribery?
Bribery Act 2010
What are the key principles of the Bribery Act?
- Proportionate procedures
Organisations should ensure that procedures are proportionate to the risks it faces and the nature, scale and complexity of its activities. - Top-level commitment
The top-level management should be committed to prevent bribery and foster a culture within the organisation in which bribery is unacceptable. - Risk assessment
Organisations should assess the nature and extent of its exposure to risks of bribery, including potential external and internal risks of bribery. - Due diligence
The organisation should apply due diligence procedures in respect of persons who perform services for – or on behalf of – the organisation. - Communication
The organisation should ensure its bribery prevention policies and procedures are embedded and understood throughout the organisation. - Monitoring and review
The organisation should monitor and review procedures designed to prevent bribery and make improvements where necessary.
What are the requirements of firms in relation to money laundering and terrorist financing?
In relation to money laundering and terrorist financing RICS-regulated firms must:
1. Not facilitate or be complicit in money laundering or terrorist financing activities
2. Have systems and training in place to comply with these laws, and ensure these are followed
3. Report any suspicions of money laundering or terrorist financing activities to the relevant authorities (where there is no local legislation the activity should be recorded and, if possible, reported to a senior manager)
4. Take appropriate measures to understand the client and the purpose of the transaction
5. Verify the identity of their client by undertaking basic identity checks
6. Record and retain information detailing how the firm has met the requirements of this professional standard.
7. Evaluate and review periodically the risks that prospective and existing business relationships present in terms of money laundering or terrorist financing offences taking place
8. Ensure that their responses to the risks identified are appropriate, including conducting appropriate checks on clients and customers
9. Use reliance only where there is an appropriate level of confidence in the quality of the information provided by the third party – reliance should only be taken from third parties with standards conforming to the legal requirements
What are the requirements of members in relation to money laundering and terrorist financing?
In relation to money laundering and terrorist financing RICS members must:
1. Not facilitate or be complicit in money laundering or terrorist financing activities
2. Report any suspicions of money laundering or terrorist financing activities to the relevant authorities (where there is no local legislation the activity should be recorded and, if possible, reported to a senior manager).
Provide an example of money laundering?
Converting and investing illegally gained money into property.
Provide examples of what members should do in relation to money laundering and terrorist financing
- Keep up to date with current training/regulation
- Comply with their employer’s policy and process relating to money laundering and terrorist financing
- Keep reports of suspicion of money laundering and terrorist financing activity confidential
Provide examples of what firms should do in relation to money laundering and terrorist financing
- Have a written policy addressing money laundering and terrorist financing risks that covers issues such as:
– in high-risk situations where enhanced due diligence is required, understanding the
source of funds in a transaction
– identifying PEPs
– the process to be followed for customer due diligence - Provide appropriate, recurring training for staff, to ensure they are familiar with the risks
associated with money laundering and terrorist financing and the firm’s systems to counter these risks - Keep reports of suspicion of money laundering and terrorist financing activity confidential
What is the anti-money laundering process in your firm?
AML is to be undertaken on:
- Any sale (checks on both the buyer and the seller)
- Any letting where the rent is more than 10,000 euros a month.
- Complete customer due diligence (verify ID, understand the reason for the business relationship)
Undertake a risk assessment/screening process:
- Check the sanctions list
- Check to see if PEP
- Undertake a negative news screening
- Check ownership of the property on the Land Registry if appropriate
- Check details of persons on Companies House
- Check source / origin of funds is legitimate
- Undertake standard or enhanced due diligence depending on the risk (⦁ Enhanced due diligence to be undertaken on PEP’s etc.) - involves verifying source of funds, source of wealth, extra ID measures)
- Report any suspicious activity to the firms money laundering reporting officer
Provide examples of what you might report to your firms money laundering officer
- Checking the sellers’ or buyers’ identity is difficult
- Unusual source of funds
- If there’s an unusually big cash or foreign currency transaction
Provide examples of bodies within the RICS
- LionHeart is an independent charity specifically designed for past, present and future RICS professionals and their families.
- The support is global and ranges from:
- Finance
- Health & Wellbeing
- Family related support
- Work-related support and many more
- RICS Matrics is an early career community designed to support students, apprentices, trainees and those who are newly qualified (up to 10 years), as they move into the industry.
- It gives the community a platform to influence the profession, as well as an opportunity to network and gain support as they go through the assessment.
What are the three different types of conflict?
- Party conflict
- Own interest conflict
- Confidential information conflict
If there is a conflict of interest, does this mean the parties definitely can’t act?
- No if parties provide informed consent then the parties can proceed with the instruction subject to being separated by an information barrier.
- You should only seek informed consent if you are satisfied that all of the relevant clients’ (or other parties’) interests will be served by you doing the work
Under what circumstances would informed consent not be enough?
- If a professional assignment is contentious, Informed Consent is unlikely to be an adequate basis on which to manage a Party Conflict.
- Where the appointment is subject to a specific statutory or regulatory regime and getting informed consent would not be sufficient to overcome the existence of a Conflict of Interest.
- You could not obtain informed consent where you have professional assignments that conflict with each other
What processes do Brown & Co have in place with regard to Conflicts of Interest?
- Record all details of all parties associated to the transaction on a firmwide database.
- Prior to accepting a new job each surveyor searches the database for any prior involvement with the client / property. If in doubt a firm wide email is circulated asking those to declare any current / historic involvement
- Note details of decisions made where there is a conflict of interest.
- Obtain informed consent where is is beneficial to both parties for Brown & Co to continue to act.
What is informed consent?
‘Informed Consent’ means: consent given willingly by a party who may be affected by a Conflict of Interest and they have demonstrated that they understand:
- That there is a Conflict of Interest or a significant risk of a Conflict of Interest and
- The facts known by the RICS member or the regulated firm that are material to the Conflict of Interest and
- What that Conflict of Interest is or may be and
- That a Conflict of Interest may affect the ability of the RICS member or a regulated firm to advise or act fully in the interests of a client.
What is a party conflict?
A situation in which the duty of an RICS member or firm 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.
What is an own interest conflict?
A situation in which the duty of an RICS member firm to act in the interests of a client in a professional assignment conflicts with the interests of that same RICS member/firm.
What is a confidential information conflict?
A conflict between the duty of an RICS member or firm to provide material information to one client and to keep that same information confidential to another client.
How can you determine whether CPD is formal or informal?
- RICS CPD Decision Tree
- If the activity doesn’t focus on a topic relevant to the wider profession, or your role or specialism, the learning is neither formal nor informal CPD.
What is formal CPD?
- Formal CPD can be any form of structured learning that has clear learning objectives and outcomes, such as a professional course, structured online training, technical authorship, learning that includes an assessment measure.
- Can include self-managed learning as long as it has a clear learning outcome which is clearly linked to the member’s development needs.
What is informal CPD?
- Informal CPD is any self-managed learning that is relevant or related to your professional role.
- Includes attendance at informal seminars or events where the focus is on knowledge sharing. Can include activities such as private study and on-the-job training.
What is whistleblowing?
Whistleblowing is ‘making a disclosure in the public interest’ and occurs when a worker raises a concern about danger or illegality that affects others.
- Follow the guidance on RICS website – speaking up
- As a member of RICS you have a professional duty to promptly disclose the details of any Regulated Member that you reasonably believe may have breached RICS standards (byelaw B5.2.1(c) of the Royal charter and bye-laws).
Provide an example of whistleblowing
If you found that client monies had been misappropriated by a member of staff, you could report the member of staff to the police and also reports the matter to RICS.
How can you report concerns to the RICS?
You can make a report through their online form, or by sending an email and any supporting evidence that you have to complaints@rics.org
What are the RICS Client Money Protection Scheme Rules?
Scheme members must:
- Maintain a Client Money Account in which all Client Money is paid.
- A Client Money Account must contain client in the title and be easily distinguished from any other accounts.
- All clients must be advised that Client Money will be held in a Client Money Account and be notified of the details of that account
- Confirm in writing with the bank with which it holds a Client Money Account that the bank acknowledges that monies in the Client Money Account must not be combined with, or transferred to, any other account
- Keep records and accounts which show all dealings with Client Money, and demonstrate that all Client Money held by the firm is held in a Client Money Account.
When handling client money, scheme members must:
1. Have and comply with written procedures for handling Client Money, which must comply with any RICS requirement to which Rule 7.4 refers;
2. Publish their procedures for handling Client Money on their website
3. Provide a copy of their procedures for handling Client Money to any person who may reasonably require a copy, free of charge;
4. Keep records and accounts that show all dealings with Client Money;
5. Repay any Client Money, including where feasible any interest earned, without delay if there is no longer any requirement to retain that money or the relevant client requests it; and
6. Hold and maintain professional indemnity insurance cover that is appropriate for the Member’s size, income, type of work and the amount of Client Money held.
What is the purpose of a client account?
Keeps the clients’ money in a designated account and separate from office money in accordance with the RICS Professional Standard – Client Money Handling
Can interest be charged?
Yes, but where the client has given instructions to hold monies in a high interest account with penalties for instant access, penalties are only paid out of the client account if the client has provided specific informed consent and this will not result in an overdrawn balance – otherwise the bank must be instructed that penalties are to be applied to the office account.
What would you do if a client paid monies into the client account before the instruction was complete?
- This would be considered as client’s money – i.e. money received and held by a firm that does not solely belong to it as the work had not yet been complete.
- Advise the client who pays fees in advance for surveying services (but not property agent services in England that this money is not covered by the Client Money Protection scheme.
- When fees are due and payable send an invoice or other written notification of the costs incurred to the client before withdrawing money from a client money account for payment of the firm’s fees, and then transfer those monies out of the client account promptly.
What is client’s money?
Clients’ money is any money received and held by a firm that does not solely belong to it, e.g.:
- tenant’s deposits;
- rents;
- service charges;
Firms must have systems in place to ensure that clients’ money can be clearly linked to the clients to whom it belongs and is protected on their behalf in all circumstances including:
- insolvency
- misappropriation by any party; and
- death of a sole practitioner.
How can a firm preserve the security client money?
- Keep clients’ money in a designated account(s).
- Obtain clients’ written approval to make payments from their accounts.
- Bank at the earliest reasonable opportunity.
- Nominate authorised staff to handle money.
- If you make use of cash receipts to settle transactions by cash, make sure your records show all cash transactions.
- Manage transactions using an accounting system appropriate to the business.
How would you AML a PEP?
- Consider the risks and whether these will impact the overall assessment of the person.
- Apply enhanced due diligence to the risks.
- Take appropriate measures to establish source of wealth and funds; and
- Undertake enhanced ongoing monitoring of the relationship
- Obtain approval from the money laundering reporting officer for all relationships with politically exposed persons.
- Record approvals in a politically exposed persons register.
What are the different stages of money laundering?
Placement – where criminals dispose of “dirty” money and introduce it into the financial system. This could be accomplished by placing the “dirty” money into a bank account.
Layering – this is achieved by carrying out many different transactions to obscure the audit trail e.g. investing a lump sum in a fund and then redeeming that holding after a very short period.
Integration – laundered money, now clean, is integrated into the legitimate economy.
Who is the RICS President?
Ann Gray – became president January 2023.
Who is the CEO of the RICS?
Justin Young – appointed in July 2023.
What are the different levels of membership in the RICS?
- FRICS - fellow
- MRICS - member
- AssocRICS – associate
What are the offences under the Bribery Act 2010?
- Making a bribe
- Receiving a bribe
- Bribery of a foreign public official
- Failure of a corporate to prevent bribery on it’s behalf
Who policies money laundering?
Financial Conduct Authority
What would you do if you suspect there may be a conflict of interest?
- Obtain informed consent but only if it:
a. is in the interests of all of those who are or may be affected
b. is not prohibited by law
c. that the conflict will not prevent the member or regulated firm from providing
competent and diligent advice to those that may be affected.
Put an information barrier in place if appropriate or decline the instruction.
What is meant by an information barrier?
The physical and/or electronic separation of individuals
(or groups of individuals) within the same firm that prevents confidential information passing between them.
What are the mandatory requirements of the RICS Professional Standard - Conflicts of interest?
- An RICS member or regulated firm 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 of those who are or may be affected have provided their prior Informed Consent.
- Every RICS member must:
a identify and manage Conflicts of Interest in accordance with the professional
standard and
b keep records of the decisions made in relation to whether to accept, and any measures taken to avoid Conflicts of Interest arising. - RICS members and regulated firms must maintain confidentiality of Confidential
Information unless disclosure is required or permitted by law, or the RICS member / firm concerned can demonstrate that the relevant party consented to the
disclosure before it was made. - Every RICS member must provide to every client all the information that is material to that client’s professional assignment of which that RlCS member has knowledge.
- Every RICS regulated firm must have in place effective systems and controls appropriate to the size and complexity of their business to enable them to ensure that the firm and its employees are able to manage their compliance with the professional standard.
What are the British Values?
M - Mutual respect and tolerance
I - Individual liberty
L- Law (rule of law)
D - Democracy
What are the RICS Document Types?
New RICS document categories:
- Professional standards
Set requirements or expectations for RICS members and regulated firms about how they provide services or the outcomes of their actions.
- Practice information
Information to support the practice, knowledge and performance of RICS members and regulated firms, and the demand for professional services.
What are the overall requirements of the RICS Professional Standard: Client Money Handling
- RICS members and RICS-regulated firms must comply with the Rules of Conduct and demonstrate compliance with the mandatory requirements set out in the RICS Professional Standard: Client Money Handling.
- All principals in RICS-regulated firms must ensure they and everyone employed in the firm complies with this professional standard.
- If client money is held by a wholly-owned subsidiary company on behalf of the RICS regulated firm, or an appropriately contracted third-party transaction service provider, the firm and its principals remain responsible for holding client money securely in compliance with this professional standard and must ensure all information and records relating to client money are available to RICS on request.
