L1 Ethics, Rules of Conduct and Professionalism Flashcards
Why do you want to become a member of RICS?
1.) Status - being prestigious. Demonstrate to clients I work to the highest professional and ethical standards. Clients know RICS members understand industry standards. People admit it’s a difficult qualification to gain.
2.) Knowledge - range of standards to follow, CPD training and best practice guidance provided. Continue development.
3.) Networking opportunities.
4.) Market advantage / Financial Reward - expected increase in salary.
5.) Recognition - globally
What is the role of RICS?
Promotes and enforces the highest professional qualification and standards in the development and management of land, real estate, construction and infrastructure.
“Positive change in the built and natural environments”.
What are they key functions of RICS?
RICS main roles comprise;
1.) advancing the standards for professionals
2.) enforcing the standards and codes of practice
3.) equipping RICS members with advice
4.) promoting RICS status
What is a Royal Charter?
Instrument of incorporation.
Granted by the monarch.
Allows independent legal personality (creation of law by creating rights and duties) and reflects the high status of the body.
Examples include the BBC, Bank of England and RICS.
Who is the current RICS president?
Clement Lau
Since September 2021
What do you understand by the term self-regulation?
Organisation or body regulating itself without intervention from external bodies.
Can you tell me what you understand by the principles of better regulations?
Ensures evidence-based and transparent law-making.
Based on the views of those that may be affected.
What is a Bye-Law?
Local laws made by local authority or organisations.
Give an example of one of the RICS Bye-Laws.
Rules of Conduct.
Explain the new RICS Rules of Conduct - what do they replace?
New RoC in a single document. Previously a separate document for firms and members.
Sets out 5 rules and professional obligations to RICS.
Replaced the old Rules of Conduct for firms and members in February 2022.
Respond to new risks and opportunities.
When do the new Rules of Conduct take place?
2 February 2022
Who do the new Rules of Conduct relate to?
RICS accredited firms and members
What are the 6 ethical principles that the Rules of Conduct are based on?
Honesty, Integrity, Competence, Service, Respect and Responsibility.
What are the 5 rules of conduct?
1.) Members and firms must be honest, act with integrity and comply with their professional obligations, including obligations to RICS.
2.) Members and firms must maintain their professional competence and ensure that services are provided by competent individuals who have the 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 the profession.
Give an example behaviour of each Rule of Conduct.
1.) identify actual and potential rules of conduct.
2.) Only undertake work that they have the knowledge, skills and resources to carry out competently.
3.) Understand client’s needs and objectives.
4.) Treat everyone fairly and do not discriminate.
5.) Respond to complaints promptly.
What are the core professional obligations of firms and members to RICS?
RICS firms:
- Must publish a complaint-handling procedure.
- Must ensure appropriate professional indemnity insurance cover in place (meets standards approved by RICS).
- Appropriate arrangements in their absence, inability to work or death (sole principal).
- Must cooperate with RICS.
- Must promptly provide all information requested by the Standards and Regulation Board.
- Must display denote that they are regulated by RICS.
- Report to RICS any matter that they are required to report under the Rules for the Registration of Firms.
RICS members:
- Must comply with CPD requirements.
- Must cooperate with RICS.
- Must promptly provide all information requested by the Standards and Regulation Board.
What disciplinary procedures can the RICS impose?
Head of Regulation will consider taking action;
Impose Regulatory Compliance Order.
Or refer to Regulatory Tribunal
(Single Member or Disciplinary Panel).
In what circumstances can the disciplinary procedures be imposed?
Breach of RICS standards and rules, where the public interest and the reputation of the profession is involved.
When did RICS last update their disciplinary panel rules?
2 March 2020.
Regulatory Tribunal Rules.
Replaces ‘Disciplinary, Registration and Appeal Panel Rules’.
What are the different levels of action within the disciplinary procedures?
Where a member admits allegations, the Head of Regulation may impose Regulatory Compliance Order (after October 2019), with their agreement. Include a number of requirements, but avoid public hearing. This is too ensure future compliance.
Where member does not admit the allegations, but the case may not warrant a hearing, the case may be referred to a Single Member of the Regulatory Tribunal to determine the disciplinary outcome.
Most serious cases, Head of Regulation may refer a case to a Disciplinary Panel. Conduct a hearing to hear the evidence and determine the outcome.
Sanctions include;
Caution
Fine
Conditions
Expel/de-register member.
What do you understand by the term professional practice?
Use of knowledge in a particular profession.
Behaviour in workplace.
Holds professional responsibility.
What money laundering regulations or legislation are you aware of?
Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulation 2017.
Money Laundering and Terrorist Financing Regulations 2019.
Terrorism Act 2000.
Crime Act 2002.
What is a red flag of money laundering?
Warning signs.
Examples include politically exposed persons (hold position of influence), large amounts of cash and unwillingness to provide information.
What bribery legislation are you aware of?
Bribery Act 2010.
What is a bribe?
A benefit given, promised or offered in order to influence an improper performance.
What are the penalties for accepting a bribe?
Under the Bribery Act, an individual accepting a bribe may be liable to imprisonment, fine or both.
Also RICS disciplinary as would likely be against the public interest.
What are the penalties for being involved in money laundering?
Criminal prosecution- substantial fine, custodial sentence.
What constitutes an offence under the Bribery Act 2010.
1.) Bribing another person.
2.) Accepting bribe.
3.) Bribing a foreign public official.
4.) Failure to prevent bribery.
What constitutes an offence under the current money laundering regulations?
Breach one of the relevant requirements under the legislation e.g. failure to carry out customer due diligence checks or reporting suspicious activity or not registering with HMRC.
What is Professional Indemnity Insurance?
Insurance for professional firms and people to cover them in the event of errors made in the workplace.
Can you tell me about the RICS requirements in relation to Professional Indemnity?
All RICS-regulated firms need to ensure they have adequate and appropriate PI insurance, that complies with the requirements of UK RICS PIII requirements (version 9 - effect from 1 April 2022).
Must carry run-off when ceasing to trade.
Claims-made basis.
Minimum limit of indemnity.
Maximum level of uninsured excess.
What is a Professional Indemnity aggregation clause.
Per claim basis - insurer would not have to pay in respect of each claim, even if total exposure exceeds cover provided in the policy schedule.
What does claims made mean in terms of professional indemnity.
PII policies work on a ‘claims made’ basis. Covers claims that are first made against the insured during the period of insurance, regardless of when the negligence act occurred.
Is a professional indemnity excess usually paid for per claim?
Usually covered in a claims made basis.
Save for aggregation clause.
In a negligence claim, what would help to show that you acted with consideration and due process?
Evidence including;
Terms of Engagement.
Correspondence and conversations documented.
Money laundering documents.
Can good record keeping help to provide a defence in personal insurance claim?
Yes.
Proper records of work and decisions to demonstrate any advice.
If you were providing services outside of your usual scope to a client, what might you need to do in relation to your professional indemnity insurance cover?
If unsure work is covered, check the policy. If not covered, work to be declined.
What is run off cover (PI)?
Provides indemnity for unknown claims and/or circumstances that may arise from your previous business activities and during the period of Run off.
It only provides cover for prior activities and does not cover any future activities after the run off date.
What RICS requirements are there relating to run off cover?
Firms ceasing to trade requires fully retroactive run-off cover.
What changes did RICS recently make to the Minimum Approved PII Wording?
Included greater fire protection for surveyors.
