Ethics, Rules Of Conduct, Professionalism Flashcards
‘What sort of information do registered firms have to send to the RICS annually?
- Annual return – completed online failure results in a fixed penalty
- Type of business and staff
- Nature of clients
- Training provision
- Complaints handling procure
- PI insurance details
- Whether the firm holds any client money
What must a complaints handling procedure include?
The RICS provides a model form
- Must include a redress mechanism
- Detail should be issured to the client with the terms of business
- Must be clear quick transparent and inpartial and free
- Names and contact details of the nominated inestigating person must be stated.
- Complaint must be investigated within 28 days
- All complaints, progress and outcomes must be recorded
- Note the need to advise PI insurers of a complaint
- 2 stages as a minimum
- Consideration of the complaint by a senior member of the firm
- If not resolved, referred to an independent third party with the authority to award redress
If you was chartered how would you deal with a situation such as a friend asking you to provide them with QS advice?
- I can not advise on my own without PI insurance.
- If I do have my own PI insurance then I would ensure that the info given was subject to the thorough checking process given to all info prior to accepting instructions regardless of who it was
- Inform then to contact me during working hours to discuss t&c’s of appointment.
- If I am not comfortable acting for them then I will advise them to use the RICS find a surveyor scheme.
- Adhere to rules of conduct
What does PII stand for?
Professional indemnity insurance
What is the purpose of PII?
To provide financial cover in the event a client suffers financial loss as a result of a breach of professional duty e.g neglect, error or omission.
What benefits does PII provide?
- the Professional is protected from financial loss.
- Does not have to meet the claim from their own assets and resources allowing smooth continuity of business
What basis should PII be underwritten?
On a claims made basis
What does on a claims made basis mean?
- This is the insurance policy that is in place at the time the breach is discovered that is claimed.
- Not the insurance policy in place when the breach was made
Tell me about Merrett v Babb?
- Court case in 2001
- Babb had done a valuation as an employee of a company for a house purchased by Merrett
- Valuation later found to be negligent
- Original company no longer existed.
- Court ruled Merrett could pursue the individual Babb for the losses
- Big shock in the industry
What is the significance of the Merrett v Babb case?
- Considered if a professional employee was vulnerable to claims brought directly against them for advice given on behalf of their employers
- Highlights importance of run off cover
- Professional individuals and firms must ensure that run off cover is in place after they leave or their firm’s employment or a firm ceases trading.
- Individuals should ensure that their ex company keeps up this cover on their behalf.
How long should run off cover be in place for?
- Dependant on type of contracts the professional is involved in.
- Usually 6 years minimum but RICS advises 15 years
What are the requirements regarding PI by the RICS
- Must be made on an ‘each and every’ claim basis
- Gives min wording
- Sets out minimum levels of indemnity
- Sets out minimum level of uninsured excess
- Run off cover must be in place for 6 years
- Should include cover for past and present employees, directors and partners
What are the minimum levels of indemnity? / how do you determine the level of PI cover?
Depends on turnover
- If turnover is 100k or less – 250K
- If turnover is 100k-200k – 500k
- If turnover is above 200k – 1mil
What are the maximum level of uninsured excess
- Depends on the level of indemnity
- Up to 500k = greater of 2.5% of insured sum or 10k
- Over 500k = 2.5% of insured sum
What measure should be taken to avoid PI claims, name at least 3
- Keep full and detailed records of meetings and conversations
- Record recommendations and advice given
- Use proper letter of engagement, scope of services and terms of engagement
- Don’t advise on specialism outside of experience
- Use rics guardance
- Avoid poor organisation and high workloads.
When did the new RICS rules of conduct become effective?
2 Feb 2022
how many professional obligations to RICS are there for RICS members?
3
How many professional obligations to RICS are there for Firms?
7
What are the five rules of conduct?
- Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.
- Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise.
- Members and firms must provide good-quality and diligent service.
- Members and firms must treat each other with respect and encourage diversity and inclusion.
- Member 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
HICSRR
Principles of better regulation
PACTT
What is rule 1 and can you give an example?
Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.
Example – i have remained firm in sticking to the correct valuation process when asked to deviate by a ratepayer requesting a reduction
what is rule 2 and can you give an example?
Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise.
Example – not acting beyond my competence, seek specialists where required. HMRC Tax example
what is rule 3 and can you give an example?
Members and firms must provide good-quality and diligent service.
Example – use terms of engagement to clearly meet the needs of the client. Timeliness
What is rule 4 and can you give an example?
Members and firms must treat each other with respect and encourage diversity and inclusion.
Example – respectful in IHT negs - Q&A after training
what is rule 5 and can you give an example?
Member 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
Example – questioning any suspectable behaviour and be a whistle blower if required.
what is a whistle blower?
A worker who reports wrongdoing in the public interest such as fraud or the company breaking the law.
Can you lose your job for blowing the whilstle?
You are protected by law if you unfairly lose your job.
You can take a case to employment tribunal if your treated unfairly because you’ve blown the whistle.
What is a tribunal?
A court that settles certain types of disputes.
which rule states that members must comply with 3 professional obligations to the RICS?
Rule 1
What are the 3 professional obligations to the RICS for members?
- Members must comply with the CPD requirements set by RICS
- Members must cooperate with the RICS
- Member must promptly provide all information reasonably requested by the standards and regulations board, or those exercising delegated authority on its behalf.
C.C.I
(think CCA but I for individual obligations)
what are the seven obligations mandatory for RICS-regulated firms?
- Firms must publish a complaints-handling procudure which includes an alternative dipute 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 insurance 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 ability to work.
- Firms must cooperate with RICS
- Firms must promptly provide all information reasonably requested by the standards and regulations 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.
C.P.S.C.I.L.R
CPS-CIL-R
Companies continue w/RICS
What are the main Rules for the Registration of Firms? (2)
- Firms must have at least 50% principles (RICS Qualified members senior manager, partner or owner)
- Regulated firms must designate a ‘Responsible Principal’ who will provide oversight, accountability and engagement with RICS standards and regulation.
Who makes the rules for registration of firms?
Standards and regulation board
how can you negate the chances of breaking rule 2 “Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the necessary expertise.”
Follow RICS standards and guidance
what is the hierarchy of RICS documents?
International standards Global professional standards UK professional statements Guidance notes Codes of practice
I G U G COP
What are RICS bye-laws?
Principles underpinned by the rules and regulations
what are RICS regulations
Regs that Build on the by-laws with further detail on areas such as fees and membership.
Define RICS
The Royal Institution of Chartered Surveyors incorporated by Royal Charter
Define Surveyor
A person who provides a service related to the profession of a surveyor as set out in the Charter.
when was the RICS incorporated by Royal Charter?
26th August 1881
When was the RICS founded?
15th June 1868
what does RICS having royal charter mean?
RICS has a seat on the privy council to advise the crown (his majesties government).
what does the royal charter require members to do?
Promote the profession for public benefit.
Who is the RICS President?
Tina Paillet FRICS
who are the members of the presidential team?
President – Tina Paillet
President Elect – Justin Sullivan
Senior Vice President – Nicholas Maclean
CEO – Justin Young
what is the RICS Motto?
Modus est rebus – there is measure in all things
What is the VOA policy on gifts?
We do not accept gifts generally, unless of very small monetary value
polite but firm refusal
tea / coffee / biscuits fine
if unsure consult HR
Tell me about the RICS professional statement on Money Laundering
Countering bribery and corruption, money laundering and terrorist financing, PS 2023
Sets Mandatory requirements for anti-money laundering such as:
- Not facilitate or be complicit in money laundering or terrorist financing activities
- have systems and training in place to comply with these laws, and ensure these are followed
- report any suspicions of money laundering or terrorist financing activities to the relevant authorities
- verify the identity of clients by undertaking basic identity checks.
- understand the client and the purpose of the transaction
record and retain information detailing how the firm has met the requirements of this professional statement.
Guidance sets out supporting good practice regarding anti-money laundering. Such as:
- Have a written policy addressing money laundering and terrorist financing risks
- Have appropriate governance and systems controls in place, proportionate to the type of work the firm does
- provide appropriate, recurring training for staff, to ensure they are familiar with the risks associated with money laundering.
- keep reports of suspicion of money laundering and terrorist financing activity confidential
- appoint a senior person to be responsible for ensuring anti-money laundering and counter-terrorist financing policies are in place and complied with.
