Ethics, rules of conduct and professionalism Flashcards
Why do you want to become a member of the RICS?
- Status
- Recognition
- Market Advantage
- Knowledge
- Network
What is the role of the RICS?
- Promoting and enforcing the highest professional qualifications and standards in the development and management of land, real estate, construction & infrastructure
- Accountable to all members and public
- Involved in policy influence and political engagement
What are the key functions of the RICS?
- Maintain the highest standards of education and training
- To protect consumers through strict regulations of professional standards
- To be the leading source of information and independent advice on land, property construction and associated environmental issues
What is a Royal Charter?
- A royal charter is a document issued by the monarch that gives independent legal standing to an organisation.
Who is the current RICS president?
Tina Paillet
What do you understand by the term self-regulation?
- responsibility for regulating its members.
What is a Bye-Law?
- a rule made by a company or society to control the actions of its members.
Give an example of one of the RICS Bye-Laws.
- BYE-LAW 2: MEMBERSHIP AND REGISTRATION
Explain to me the new RICS Rules of Conduct - what do they replace?
- Replace the previous Rules of Conduct for Members and Firms and the 5 Global Professional and Ethical Standards
- 5 Rules of Conduct
(1) Members and firms must be honest, act with integrity and comply with their personal obligations, including obligations to RICS.
(2) Members and firms must maintain their professional competency and ensure that services are provided by competent individuals who have necessary expertise.
(3) Members and firms must provide good-quality and diligent service.
(4) Members and firms must treat others with respect and encourage diversity and inclusion.
(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 their profession.
When do RICS Rules Conduct take effect?
- 2nd Feb 2022
What is the core professional obligations of firms and members to RICS?
- 3 for members, 7 for firms
Members
(1) Comply with CPD requirements.
(2) Cooperate with the RICS
(3) Promptly provide all information when requested by boards or delegated authorities.
Firms
(1) Publish a CPH, including ADR provider.
(2) All work covered by adequate PII.
(3) Sole principal work to continue in cases of incapacity or death.
(4) Cooperate with the RICS
(5) Promptly provide all info to boards and authorities
(6) Record on literature that they are RICS regulated.
(7) Report to RICS any matter they are required to
What disciplinary procedures can the RICS impose?
(1) Action by Head of Regulation
(2) Disciplinary Panel
(3) Appeal Panel
In what circumstances can disciplinary procedures be imposed?
- Failure to follow RICS Guidance
When did RICS last update their disciplinary panel rules?
- 2022
What are the different levels of action within these disciplinary procedures?
(1) Issue a Regulatory Compliance Order
(2) Reprimand
(3) Fine
(4) Impose unlimited fine proportionate to breach
(5) Impose conditions upon future continued RICS registration
(6) Expulsion from membership or removal of firm
(7) Require publication of results on Modus and in the local newspaper
What do you understand by the term professional practice?
- Professionalism. How you apply and carry yourself in day-to-day dealings with colleagues, clients and third parties
What is a red flag of money laundering?
- Inability or unwillingness of parties to provide identity documents
- Changes to parties involved in the transaction
- Payment in unusual currencies
- Unusual transaction features
What money laundering regulations or legislation are you aware of?
- Terrorist Financing and Transfer of Funds regulations, 2017 (amended 2023)
- RICS Professional Standard: Countering bribery, corruption, money laundering and terrorist financing, 2019
What are the penalties for accepting a bribe?
- Individuals: Max of 10 years imprisonment or unlimited fine
- Firms: Unlimited fine
What bribery legislation are you aware of?
- Bribery Act 2010
What is a bribe?
- Giving, offering, promising or receiving of an advantage such as payment, gift or a service for an action which is illegal or a breach of trust
What are the penalties for being involved in money laundering?
- 14 years prison sentence or an unlimited fine for assisting
- 5 years prison sentence or an unlimited fine for helping those avoid being detected
What constitutes an offence under the Bribery Act 2010?
(1) Bribing
(2) Receiving a bribe
(3) Bribing a foreign public official
(4) Failing to prevent bribery
What constitutes an offence under the current money laundering regulations?
(1) Concealing criminal property
(2) Arrangements
(3) Acquisition and use of possession
How long should you keep anti money laundering records for?
- Minimum of 5 years
What is Professional Indemnity Insurance (PII)?
- Insurance taken out to protect clients, surveyors and third parties against negligence claims when there is a duty of care breached and claim for damages arises
Can you tell me about the RICS requirements in relation to PII?
- Required for all surveyors working in practice. Policies must be underwritten from a RICS approved insurer. Minimum insurance based on turnover amount in the preceding year.
What is a PII aggregation clause?
- Policies cover claims that are made during the period of insurance regardless of when the negligent act occurred
Is a PII excess usually paid for per claim?
- No, based on turnover in preceding year
In a negligence claim, what would help to show that you acted with consideration and due process?
- Make detailed notes, follow Professional Standards and Guidance
If you were providing services outside of your usual scope to a client, what might you need to do in relation to your PII cover?
- Cap in Terms of Engagement but shouldn’t be carrying work outside your scope of competence
Can good record keeping help to provide a defence in a PII claim?
- Yes, it may show that you acted with consideration and due process
What is run off cover?
- Cover required following cessation of trading
What RICS requirements are there relating to run off cover?
(1) Consumer claims, minimum £1 million aggregate cover over a period of 6 years
(2) Commercial claims, firms need to consider what is adequate and appropriate for 6 years
Would a dictated report avoid the need to have any written site notes?
- Potentially, if the dictated notes are detailed and then recorded off site
How long can a PII claim arise after the work is undertaken?
- Contract: 6 years from date of negligent act or 3 years from knowledge of damage with long stop of 15 years
- Tort: 6 years for suffering of loss
What is the Assigned Risks Pool (ARP)?
- Those unable to arrange cover
Explain your understanding of the RICS Guidance Note Risk, Liability and Insurance (1st Edition).
- Guidance Note that recommends the use of liability caps to manage risk. Make clear that any advice can only be relied upon by the named client
Explain when you might agree a liability cap.
- Terms of Engagement
When and how can the RICS be involved in a complaint about a firm or member?
- When there is no response to the complainant, or they are prevented from accessing an independent redress mechanism
Can you tell me about the CPD requirements for members of RICS?
- 20 hours for chartered members, 50% of which must be formal
Tell me about the RICS’ guidance on dealing with Conflicts of Interest.
- RICS Global PS on Conflicts of Interest, 2017. Effective from Jan 1st 2018.
What is double dipping (dual agency)?
- Representing both the buyer and seller simultaneously
How would you close down a regulated firm?
(1) Inform the RICS
(2) Ensure clients are informed at the earliest opportunity and arrange hand over
(3) Return any money held in client accounts
(4) Inform insurers and procure PII run off for 6 years
(5) Retain copy of client files and records for a minimum of 6 years
What can you tell me about RICS guidance relating to bribery, corruption or money laundering?
- PS – Countering bribery, corruption, money laundering and terrorist financing, 2019.
- Sets out mandatory, globally applicable requirements for RICS members and regulated firms in relation to bribery, corruption, money laundering and terrorist financing
What status does it hold?
- Professional Standard
What are some of the key principles of this guidance?
- 3 parts
(1) Bribery and Corruption
(2) Money laundering and terrorist financing
(3) Guidance and Supplementary Guidance
What must/should firms/members do to comply with the guidance?
- Written policy, Code of Behaviour, Gifts register.
What are the current RICS rules for registration of firms?
- Complete firms details form
- Appoint responsible principle
- PII
- CPH
- Complaints log and complaints handling officer
Who is a ‘qualified member’ of RICS?
- A registered member that has successfully passed the assessment of professional competence