Ethics Specific Questions Flashcards
What is the role of the RICS?
USC
1) USEFULLNESS - To promote usefulness of the profession
2) STANDARDS - To uphold the highest standards
3) CONSUMER - Provide consumer advice
What is the structure of the RICS?
- Privy Council
- Governing Council
- Board and Committees (Standards, Management, Audit, Nominations)
- Committee and Panels (Finance, World Regional, Remuneration)
What is the royal charter?
- A grant issued by the Monarch allows RICS to be self governed.
- Sets out objective - to promote usefulness of the professional for public advantage
What does it mean by the RICS is self- regulated?
- operates within own regulatory framework
rather than being legislated by Government
Tell me about the Rules of Conduct for firms
- 15 rules
Part I General
- Contact Officer + submit the Annual Return
Part II Conduct of business
- Ensure professional behaviour, act competently, high standard of service, staff CPD, have (CHP), preserve security of clients’ money, hold adequate (PII)
Part III Firm administration
- Advertise in truthful manner, ensure finances managed appropriately, arrangements in place to cover incapacity/death of a sole practitioner, display Regulated by RICS designation in line with RICS’ requirements, provide information to and co-operative with RICS as requested
Tell me about the Global Professional and Ethical Standards
- ISTRR
Tell me about the Bribery Act 2010
- a company can be prosecuted for bribery even when alleged bribery takes place outside UK
- A company can be responsible for bribery carried out by its employees without its knowledge
- Criminal offence for failing to prevent bribery.
Tell me about the Money Laundering Regulations Act 2007
- Sperseded by Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017
- MLR 2017 set out obligations of private sector firms working in areas of higher money laundering risk:
o RISK ASSESSMENT - to identify and assess the risk of money laundering and terrorist financing
o SYSTEMS - Implement systems to address money laundering and terrorist financing risks
o TRAINING - Provide training to staff
What are the requirements for managing client money?
Ensure registered with appropriate RICS scheme:
- e.g RICS Client Money Protection Scheme for Surveying Services,
RICS regulated firm must:
- Access - only RICS firm
- Hold only client money
- Name of account include - client
- Funds immediately available
- Keep records
What are the requirements for CPD?
- 20 hours
What are the requirements for PII?
CLAIM - Each and every claim basis
RUN - Run off cover
CIVIL - Full civil liability
WORD - RICS’ minimum policy wording
INDEMINTY - minimum level of indemnity
What are the requirements for setting up a practice?
- ADVISE - advise RICS that you are starting a business
- REGISTER - register for regulation
- RULES - meet the requirements of the Rules
- INSURANCES - understand the need for insurances (employers liability, public liability, etc.), a health and safety policy, equal opportunities policy, etc.
- LOGO - use the RICS logo as set out by RICS and use only the appropriate alternative designation relevant to your professional group
What are the rules of registration of firms?
Need to provide:
- ADDRESS - Head office address
- DATE - Date firm established
- OFFICER - Contact officer
- CHP
- PII
- If 50% of Principals are RICS members must be regulated
- If at least 25% they can apply
- If no RICS members the firm cannot register
(Principles are sole practitioners, directors, partners, board members or equivalent)
What is your employers policy on Bribery gifts and hospitality?
Nationwide zero tolerance to bribery
o an inducement to anyone to gain an advantage
Gifts and hospitality
o Register
o Gifts and hospitality over £50 must be recorded
What is your employers’ CHP?
- Nationwide will respond within 7 days advising the case is being investigated
o confirm understanding of the circumstances - A full response will then be provided within 21 days
- Advise the actions have been taken as a result of your complaint and our investigations.
- Includes an (ADR) mechanism
o The Property Ombudsman Service - A complaint log is maintained.
Croham Road CR2
How did you deal with the applicant’s request for you to reduce your valuation?
- Reported conversation
- SAD report
- Alert code
- Valued the property with impartiality
Croham Road CR2
Who did you have a duty of care towards?
- Nationwide
- The applicant
- The applicants partner
Croham Road CR2
How did you record the incident?
- In my sites notes
- Vocally to my manager, followed up by an email summarising out conversation
- SAD report
- Alert code in report
Croham Road CR2
How did you use the alert code?
- Included the code in the report which ensures that the SAD referral is checked
Croham Road CR2 Why did you submit a SAR?
- To ensure the issue was logged
- To ensure that if the applicant attempted to remortgage again it would be on file
- To ensure the case was investigated
Croham Road CR2
Why did you submit a SAR?
- To ensure the issue was logged
- To ensure that if the applicant attempted to remortgage again it would be on file
- To ensure the case was investigated
Croham Road CR2
How did you act with integrity?
- By ensuring that I reported the conversation in the correct manner
- By acting impartially and without prejudice
CPD How many hours of CPD does an APC candidate need to submit each
year?
- 48
Ridge Road CR4
What checks did you carry out?
- Checked the vendor details
- Checked the applicant details
- Checked the agent details
- Checked whether myself or colleagues had previously completed a valuation on the subject
Ridge Road CR4
How did you formalise the instruction?
- By accepting the instruction in Xit2
Ridge Road CR4 How did you seek informed consent?
- In this case I did not seen informed consent as it decided there was a conflict of interest which may affect my ability to act impartially
- I therefore panelled to the case to ensure there was no risk of CoF
- If the CoF had been deemed acceptable I would sought informed consent from all parties, paced measures in place to ensure the conflict would not affect my impartiality and recorded the decision
Ridge Road CR4 Why did you panel out the instruction?
- To eliminate the risk of CoF
Ridge Road CR4 How did you act with integrity?
- By following CoF checks
- By identify the CoF and raising the concern
- Even through the risk of was low I eliminated the risk altogether by panelling the case
Grove Road SM1 How did you deal with the valuation complaint?
- Received the complaint
- Replied acknowledging receipt within 7 days
- Provided full response within 21 days
- Provided my original SCT and rationale
- Provided further rationale and comment upon additional evidence provided by the applicant
- Sent to my manager to review
- Original val supported
Grove Road SM1 How did you support your response to the complaint?
- Provided my original SCT and rationale
- Provided further rationale and comment upon additional evidence provided by the applicant
- Commented on market change
Grove Road SM1 What are the issues relating to a valuation without inspection?
- Limitations
- Up to date pictures
- Accuracy of floor plans/measurements
Grove Road SM1 Why was a desktop valuation appropriate initially?
- During Covid 19 pandemic and properties that fell within a certain criteria were valued this way
- Had to have information available
- Details/pictures within 2 years
- Within certain LTV
Tell me about the new rules of conduct
Feb 2022
1) Simpler structure - consolidating the Rules of Conduct for Members and Firms and Global Professional and Ethical Standards
2) Provides examples
3) Focusing on respect, diversity and inclusion
4) Understanding evolving technology
5) Sustainability - embedded sustainability within the Rules
Levitt Enquiry
4 board members, who raised concerns audit was supressed - wrongly dismissed.
Recommendation
External review needed for the purpose, governance and strategy of RICS
In addition
- Executive remuneration review
- Whistle blower policy review
- Legal advice provided with the RICS as the client (not senior management)
- Greater oversight for the Governing Council.
Hart v large
scope of inspection including limitations etc
Recommending further investigation
Ensure clients understand the differences in levels of service
recommend a full Building Survey where necessary
report anything that has not been inspected & explain why.
Consider recommending a PCC
ISTRR examples?
Integrity - Conflict of Interest Jordan example
Service - Aim to meet SLA - If not possible advise client
Trust - work outside scope
Respect - act professionally, polite
Responsibility - Covid booking
New rules of conduct
Feb 2022
1) Simpler structure - consolidating the Rules of Conduct for Members and Firms and Global Professional and Ethical Standards
2) Examples
3) Focusing on respect, diversity and inclusion
4) Understanding evolving technology
5) Sustainability - embedded sustainability within the Rules
Countering bribery and corruption, money laundering and terrorist financing
1st edition, 2019
Conflicts of interest paper
1st edition 2017
PS
Client money handling
1st edition, October 2019
Home Survey Standard
1st edition, November 2019
Effective march 21
New Rules of Conduct 2021
1) INTEGIRTY - M&F must be honest, act with integrity and comply with professional obligations
2) COMPETENCE - M&F must maintain professional competence and ensure services provided by competent individuals
3) SERVICE - M&F must provide good-quality, diligent service
4) RESPECT - M&F must treat others with respect and encourage diversity and inclusion.
5) CONFIDENCE - M&F - must act in public interest, take responsibility, act to prevent harm, and maintain public confidence in the profession.
ICSRC
Red book dates
Global Standards - Effective from January 2022
UK national supplement - effective from January 2019
Bichard Review
Created as a recommendation of the Levitt Enquiry
Review into RICS purpose, governance and strategy
Due June 2022
Objectives:
- Clarity regarding RICS’ purpose
- Best practice governance, transparency, accountability
- Proposal for new leadership and governance body
PII Fire safety
- insurers imposed fire safety exclusion on PII terms
- due to concern after fire safety failures,
- firms uninsured for fire safety
- under new terms - insurers not permitted (without specific dispensation) to exclude fire safety claims on a property four storeys or less
- fire safety coverage must be provided as a minimum on an aggregate, defence cost inclusive basis.
PII Cyber cover
- requirement for insurers to clarify cyber cover provided in PII
The changes do not restrict the cover provided in PII policies, but clarifies existing requirements on insurers from their regulator the Prudential Regulatory Authority.
How long to keep files
15 years
Limitation Act 1980
Risk, liability, and Insurance
1st Ed 2021
Guidance Note
- Outlines main risks and liabilities associated with professional services
- Breach of contract and Negligence
- Liability caps
- 3rd party reliance
- PII
