IOC - Legislation And Regulation Flashcards
According to the money laundering regulations, which of the following are false?
A: staff must be trained to recognise suspicious transactions
B: a firm must keep records for a minimum of 3 years
C: the firm must appoint a MLRO
D: the rules can apply to insurance companies
B
Records must be kept for 5 years
The code of market conduct produced by the FCA:
A: acts as a guide to general market conduct
B: acts as a guide to legislation on general market conduct
C: acts as a guide to legislation on market abuse
D: covers the general conduct of firms whilst going about their permitted activities
C
Which of the following would not be considered market abuse under S118 of FSMA 2000?
A: an employee of a firm trades on price sensitive info that has been disclosed through an RIS
B: a firm controls a large percentage of a company’s shares and takes out a large up bet with a spread betting firm
A
RIS - regulated information service.
B is an abusive squeeze
Which of the following is not a considered as a market abuse?
A: person concerned did not observe the standard of behaviour reasonably expected
B: following a conduct of business rule where the action might be regarded by the regular user as distorting the market
B
Conduct of business rules provide a safe harbour against the offence of market abuse
Which of the following is not a feature of the regular user test for market abuse? A: reasonable person B: regularly deals on that market C: deals on a daily basis D: regularly deals in that investment
C
Dealing on a daily basis is not a requirement
Market abuse involving misuse of information would cover: A: life insurance l B: units in a unit share C: shares in an OEIC D: shares in an investment trust
D
It has a secondary market and is therefore covered
Which of the following is an insider according to the CJA1993?
A: a person paying for inside information
B: an employee whose work involves inside information
C: a person who obtains inside information by observation
D: a person who obtains inside information by dealing in securities
B
D is a market maker, special defence; C is not a breach, A is illegal but the buying is not an insider
Who of the following prosecutes insider dealers? A: LSE B: department of trade and industry C: treasury D: FCA
D
Which of the following gives the FCA the power to prosecute insider dealing offences? A: FSMA2000 B: CJA1993 C: POCA2002 D: companies act 2006
A
The offence is contained with CJA but the ability to prosecute is within FSMA
Which are not excluded from MiFID? (How many of the following)
A: an institution offering underwriting in tradable securities on a commitment basis
B: an investment firm offers services within its own group
C: Portfolio mangers
D: corporate finance teams offering financial advice in the EU
D is not covered
Which of the following is not considered as ancillary services under MIFID?
A: safekeeping of financial instrument
B: granting a loan to a client in relation to the transaction
C: making a personal recommendation on a CAC 40 stock
D: granting FX services for a transaction
C
Making recommendations is covered under COBs
In MiFID which is not a core investment service or activity?
A: execution on behalf of a professional client
B: dealing in the firm’s own account
C: placing financial instrument ms on a firm commitment basis
D: giving advice ok capital structure
D
Advice on capital is ancillary
Which is excluded from MIFID?
A: insurance firms
B: broker/ dealer in freight rate futures
A
Compliance with funding rules for MiFID is imposed by: A: home state B: each individual firm C: those firms outside out the EEA D: the host state
A
Which one of the following is a defence against section S89-91 of FSA2012 making misleading statements or impressions A: market maker B: stabilisation C: conflicts of interest D: takeover code
B
