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APC Case Study and Mandatory Competencies > Ethics, Rules Of Conduct & Professionalism > Flashcards

Ethics, Rules Of Conduct & Professionalism Flashcards

1
Q

Why do you want to become a member of RICS

A

Prestige of membership, being a member of RICS helps to convey level of expertise. Being awarded membership status helps give credibility.

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2
Q

What is the role of the RICS

A

Advancing ethical and technical standards for professionals in land property and built environment
Protecting and providing benefits to consumers by enforcing standards and codes of best practice
Providing expert impartial advice to governments business and public
Equipping RICS members with leading edge advice market insights and professional training
Promoting RICS status and standards in key worldwide markets as the mark of property professionalism

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3
Q

What are the key functions of RICS

A

Develops and enforces leading international standards protecting consumers and businesses by ensuring utmost level of professionalism is employed across the built environment

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4
Q

What is a Royal Charter

A

Formal grant awarded to organisation to give it independent legal standing defines its objectives, constitution and powers and reflects its high status

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5
Q

Who is the current RICS president

A

Justin Sullivan but currently stepped aside - pending investigation over his role as expert witness in case involving infestation of moths in property in London
Acting president elect is Nick Maclean

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6
Q

What do you understand by the term self-regulation

A

No external body reviewing regulation of RICS - RICS sets its own professional standards and monitors compliance
Eg RIBA is membership body and there is independent Architects Registration Board that oversees standards
GMC oversees medical field - external oversight
SRA oversees legal profession but membership is of Law Society

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7
Q

Can you tell me what you understand by the principles of better regulation

A

Rules of conduct for firms are based on principles of better regulation
- proportionality
- accountability
- consistency
- targeting
- transparency

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8
Q

What is a bye law?

A

Rules of conduct for firms are based on principles of better regulation
- proportionality
- accountability
- consistency
- targeting
- transparency

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9
Q

Give me an example of one of the RICS bye-laws

A

EG - rules for regulation
Rules for use of RICS logo

Cover range of areas:
Membership and registration
Professional conduct
Disciplinary and regulatory powers
Regulatory sanctions
Interim measures
Speaking up

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10
Q

Explain the RICS rules of conduct - what do they replace?

A

Rules and global ethical principles

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11
Q

When did the RICS rules of conduct take effect from?

A

22 February 2022

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12
Q

Who do RICS rules of conduct relate to?

A

Members and firms

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13
Q

What are the ethical principles that the rules of conduct are based on

A

Honesty
Integrity
Competence
Service
Respect
Responsibility

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14
Q

What are the five rules of conduct

A

1 - honesty integrity and professional obligations
2 - maintaining and acting within competence
3 - providing good- quality service
4 - respect and encouraging diversity and inclusion
5 - public interest, responsibility, public confidence

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15
Q

Rule 1 - honesty, integrity and professionalism
Give an example of behaviour

A

Admitting when a mistake has been made, even if embarrassing - taking responsibility and taking action to correct it

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16
Q

Rule 2 - maintaining and acting within competence
Give an example

A

Ensuring meeting CPD obligations each year so that up to date with best practice. Making sure that you provide a competent service for client - consider what competence is required, are you best person or is your firm have necessary expertise to provide that service?

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17
Q

Rule 3 - Providing good quality service
Example of conduct

A

Proactively addressing client issue. Following up to ensure satisfaction, being efficient and committing to resolve the client problem efficiently

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18
Q

Rule 4 - Respect and encouraging inclusion and diversity
Example of behaviour

A

Ensuring that recruitment process is fair and impartial and not excluding any class of people or promoting any class
And doing the same in all everyday conduct - within firm and with third parties - clients, contractors anyone

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19
Q

Rule 5 - Upholding public image

A

xxx

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20
Q

What are core professional obligations of firms and members to RICS ?

A

Avoiding conflicts of interest
Maintaining professional standards
Acting in public interest
Promoting the profession
Cooperation with RICS
Adhering to RICS standards
Mandatory requirements

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21
Q

What disciplinary procedures can RICS impose?

A

Conduct investigations into member or firm
Take disciplinary action -
May impose regulatory compliance order
Fine, caution or conditions on membership
Disciplinary panel hearing and sanction from fine to expulsion and may include costs against member

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22
Q

In what circumstances can RICS disciplinary procedures be imposed

A

Following investigation where there is a complain or concern about regulated member or firm

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23
Q

When did RICS update their disciplinary panel rules?

A

March 2020

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24
Q

What are different levels of action within these procedures

A

Investigation followed by fine/sanction or conditions imposed on membership (low level)
Investigation followed by panel hearing and fine/ sanction or disbarment

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25
What do you understand by the term professional practice
The conduct and work of individuals within specific profession encompassing the ethical standards skills, knowledge required to perform their duties competently and responsibly
26
What money laundering regulations or legislation are you aware of?
Money laundering regs 2007 Money laundering, terrorist financing and transfer of funds regs 2017
27
What is a red flag of money laundering
Unusual transactions Rapid movement of funds Unexplained wealth Transactions involving high risk jurisdictions Transactions involving shell companies
28
What bribery legislation are you aware of?
Bribery Act
29
What is a bribe?
Financial payment or other advantage given or promised in return for acting in particular way or to exercise discretion / decision in particular manner
30
What are the penalties for accepting a bribe?
Imprisonment or fine
31
What are the penalties for being involved in money laundering?
Imprisonment or fine
32
What constitutes an offence under the bribery act 2010
Taking a bribe Making a bribe Corporation allowing a bribe Bribing a foreign official
33
What constitutes an offence under current money laundering regulations
1) Concealing or transferring criminal property 2) Arranging or facilitating criminal property 3) Disguising origins of illegally obtained money to make it appear legitimate Since 2017 professional has more onerous duties to report any suspicions
34
How long should you keep anti-money laundering records for
Five years after end of business relationship but not more than 10 years
35
What is professional indemnity insurance (PII)
Insurance policy that provides compensation for clients if policy holder provides negligent services or advice that causes loss to client
36
What are RICS requirements for PII?
Set by regulations: Must be with RICS approved insurers Must comply with regulations - be a minimum level (set according to turnover) - although firm would also want to consider the value of projects working on Must be retroactive - claims made - ie policy covers claims made against insured during policy irrespective of when negligent act took place Must have minimum excess Must have run off period - if firm ceases trading then need to have insurance for six years after
37
In a negligence claim what would help to show that you acted with consideration and due process
Following professional guidelines
38
What is PII aggregation claim
When multiple claims against insured arising from related acts or omissions are treated as single claim for policy purposes impacting deductible or policy limits
39
What does claims made mean in terms of PII
Claims that have been initiated against firm / individual
40
What is PII excess ?
Excess is sum stated in policy that insured has to pay in respect of each claim
41
Can good record keeping help to provide a defence to a PII claim?
Can help to demonstrate what advice was given or not given, so potentially yes
42
In a negligence claim what would help to show that you acted with consideration and due process?
Following RICS guidance and best practice keeping good records to show what advice was given - making sure record oral advice in email or letter after meeting.
43
Can good record keeping help to provide a defence to a PII claim?
Yes, if shows that did give appropriate advice or limits of advice
44
If you were providing services outside of your usual scope of services what might you need to do in respect of PII cover?
Contact PII provider or broker and notify them so that they can extend cover if necessary
45
What is run off cover?
PII cover put in place when firm is closed, needs to be in place for at least six years but could be longer - latent defect claim up to 15 years
46
What RICS requirements are there to provide run off cover?
Six years mandatory, longer if member wants to
47
What changes did RICS recently make to the Minimum Approved PII wording?
Minimum wording requirements issued in 2024 - quite extensive wording requirements - written on full civil liability basis - each and every claim basis or aggregate plus unlimited round clock reinstatement basis - defence costs in addition to limit of indemnity
48
Would a dictated report avoid need to have any written site notes?
Presume that would be supplemental to site notes and site notes should be on pro-forms document
49
Explain PII requirements relating to fire safety cover and cyber cover?
Must be included in policies for work carried out in respect of five storey and above Cyber coverage requirements Aline with international underwriting associations model clause
50
How long can a PII claim arise after the work is undertaken?
Limitation Act - usually six years but not in case of latent defect - maximum is 15 years.
51
What is assigned risk pool? (ARP)
Assigned risks pool (ARP) is provided by RICS to members / firms that have been unable to obtain PII anywhere else. Only after shown that all alternatives have been exhausted.
52
Explain your understanding of RICS Professional Standard Risk liability and insurance 1st edition
RICS guidance for firms on managing client risk - explains contractual and negligent liability to clients, losses that may be recoverable. Limitation on claims - 6 years under limitation act for contract or tort or longer for latent defects (max 15 years) Liability caps and when appropriate - may want to limit liability to less than PII cover - for firm to negotiate with client but needs to be reasonable - guidance about what may constitute reasonableness Third party reliance
53
Explain why you may agree to a liability cap
To limit liability to less than PII cover
54
How would you set out third party reliance in Terms of Engagement
Use the RICS set wording limiting liability to client only
55
What are the three key terms that should be considered from a risk perspective in the context of every instruction you undertake
1) Scope of service 2) Fee 3) Liability cap
56
What is an annual return
PII return - information that provide to PII company
57
What do you understand about Complaints Handling Procedure
It is the policy set by your company following RICS guidance on how to deal with client complaint
58
When and how can the RICS be involved in a complaint about a firm or memb er
When a complaint is referred to the RICS
59
What are the CPD requirements for members of RICS
Members: undertake minimum 20 hours CPD annually, 10 formal 10 informal, ethics every three years Firms: make sure all employees are undertaking CPD requirements
60
Why is CPD important
It is Rule of Conduct to provide competent service, and complying with CPD requirements ensures that everyone is undertaking CPD and keeping up to date with developments in construction industry
61
What is RICS guidance on dealing with conflicts of interest
Contained in RICS professional standard on Conflicts of Interest: RICS member must not advise or represent a client where doing so would involve a conflict of interest or significant risk of conflict of interest; other than where all those who are or may be affected have provided their prior informed consent. Informed consent may be sought only when satisfied that proceeding despite CoI is a) in interests of all those who are or may be affected b) is not prohibited by law and conflict doesn't prevent member providing competent and diligent advice to those that may be affected. 2) keep a record of all conflict of interests and decisions made
62
How would you close down a regulated firm?
Follow RICS guidance: Complete RICS checklist Apply for closure
63
What do you know about RICS guidance relating to bribery, corruption or money laundering
Professional statement 2019: sets out professional requirements currently under review and consultation of members is ongoing: Mandatory requirements: 1) not offer or accept anything that would constitute a bribe 2) have plans in place to comply with applicable laws 3) report any activity they are aware of that breaches anti-bribery and corruption legislation 4) act with due diligence to perform periodic written evaluations of risks that face the firm 5) retain information detailing how the firm has met requirements of this professional statement
64
What status does RICS professional statement on bribery, corruption money laundering or terrorist financing hold?
Sets out mandatory regulation and best practice guidance
65
What are some of the key principles of the bribery, anti money laundering and terrorist financing professional standard?
1) dont breach bribery legislation - don't accept anything that may be briber 2) don't be involved in money laundering Plus supplementary guidance on risks
66
What must / should firms do to comply with Bribery, Corruption and Anti money laundering guidance
1) Must not commit bribery or money laundering offences 2) Should prepare written policy and have appropriate governance and systems in place 3) Keep records 4) Keep up to date with legislation changes
67
What are the current RICS rules for registration of firms?
Rules for registration take effect from 2 Feb 2022 Must be run by qualified member of RICS Must apply and be approved Must follow rules for chartered firms - annual return, annual fees, PII, and follow all applicable rules and byelaws
68
Who is qualified member of RICS
Someone who has been awarded membership status by qualifying through APC or senior professional, industry specialist or academic
69
What is a phoenix firm?
RICS firm that doesn't close in orderly manner (usually don't have PII run off in place or insolvent), then rapidly re-establish themselves as new trading entity.
70
When must firm register for regulation
If it offers surveying services to the general public and has 50% more members are RICS members Handles client money
71
What are the registration eligibility criteria
It must: - offer professional services in surveying disciplines to professional, corporate or institutional clients who rely on such services - have at least 25% of principals who are qualified RICS professionals (MRICS, FRICS, AssocRICS) - agree to observe and comply with RICS rules of conduct for firms, including working to RICS standards
72
Who is a responsible principal
Person who has primary responsibility for ensuring the RICS professional, technical and ethical standards are applied, upheld and supported by an appropriate assurance framework within a regulated firm. Responsible for ensuring corporate cooperation with RICS regulatory processes, such as monitoring, investigations and disciplinary processes
73
What happens if a firm cannot comply with the eligibility criteria?
74
What are the rules around use of RICS logo and "Regulated by RICS" designation
Byelaws govern use 1) Only used by regulated member or firm 2) used appropriately and professionally 3) must appear on letterhead, website, terms of engagement and complaint handling information
75
What are the restrictions to use of designation "chartered surveyors"
76
What must be included in terms of engagement relating to firm registration
77
What is a locum and who may need one?
78
How could a sole trader set up their CHP using a locum?
79
What RICS guidance relates to handling client money?
80
When was RICS guidance on handling client money last updated?
81
What do RICS rules of conduct say about client money
82
Explain your understanding of the RICS Scheme Rules relating to client money protection
83
What are the main schemes available to firms
84
When were the main schemes last updated
85
What is the current compensation limit
86
What does the annual regulatory review fee relate to
87
What might client money include
88
How does this differ to office money?
89
What are some of the key principles of the RICS Professional Standard relating to client money protection
90
Explain the key themes from the RICS Futures 2020 Report
91
What are the potential implications of Hart v Large case
92
Explain your understanding of precedent set in Burgess v Lejonvarn
93
What do RICS set out as good practice for the use of social media?
94
Explain your understanding of the Levitt review
95
What is whistleblowing
96
What does good governance mean to you?
97
What are the Pandora Papers and what ethical issues do they raise?
98
Explain what you understand by RICS Bichard Review
99
Explain some of the recommendations of the Bichard Review
100
How will the recommendations of Bichard Review be implemented
101
How will these recommendations be implemented by RICS
102
How do professional integrity and professional ethics difer?
103
What is modern slavery and how would you identify red flags of it?
104
Explain the implications of the Sanctions and Anti-money laundering act 2018
105
What is the sanctions list and why should you be aware of it?
106
Why was the register of overseas entities introduced
107
What are the six RICS values published as a result of the Levitt review?
108
Explain the impact of the Economic Crime (Transparency and Enforcement) Act 2022
109
What are the implications of the modern slavery act on your current professional role
110
What is the purpose of the RICS
111
What are the key differences between ethical standards in legal and construction industries
Similarities: honesty, integrity, competence, client care and public confidence Differences: Legal - uphold justice, disclosure Construction - safety, quality, responsible project management and sustainability
112
What factors are important to consider when managing a supply chain, considering ethics
113
What guidance does RICS provide on ethics and professionalism

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