LM1 Chapter 6 - Legal and regulatory environment

Question 1

What does FCA stand for?

Answer 1

Financial Conduct Authority

Question 2

What does PRA stand for?

Answer 2

Prudential Regulation Authority

Question 3

What does FPC stand for?

Answer 3

Financial Policy Committee

Question 4

What is the PRA responsible for?

Answer 4

Solvency and stability of those institutions which are important to financial services industry, such as banks and insurers.

Question 5

What is the FCA responsible for?

Answer 5

Consumer protection and market regulation

Question 6

What is the FPC responsible for?

Answer 6

Watches for systemic risks, risks that impact the whole industry

Question 7

What are the three types of members that make up the Council of Lloyd’s?

Answer 7

Working, external and nominated

Question 8

What are the two main types of regulation that Lloyd’s issues for the Market?

Answer 8

Byelaws and requirements

Question 9

Who regulates the society of Lloyd’s?

Answer 9

Both the FCA and PRA as are managing agents

Question 10

Who regulates the Brokers and Members’ agents?

Answer 10

The FCA solely do

Question 11

What is the council of Lloyd’s responsible for?

Answer 11

Management and supervision of the Market

Question 12

Who manages authorisation of insurers?

Answer 12

The FCA and the PRA

Question 13

How does regulation work in the USA?

Answer 13

It is individual for each of the states

Question 14

What is the FOS?

Answer 14

The Financial Ombudsman Service

Question 15

What is the FSCS?

Answer 15

Financial Services Compensation Scheme

Question 16

What do the FOS do?

Answer 16

Is a free, independent, impartial service that deals with certain disputes.

Question 17

Who do the FOS work with?

Answer 17

Solve disputes between individual consumers or small businesses and financial organisations

Question 18

How long must the complainant give the insurer to respond before getting the FOS involved?

Answer 18

Eight weeks

Question 19

What is the maximum amount of turnover a company can have to receive help from the FOS?

Answer 19

£6.5 Million

Question 20

What is the role of the FSCS?

Answer 20

Provides compensation for customers of deposit taking companies and investment firms
Covers claims

Question 21

What policies is protection 100% for (FSCS)?

Answer 21

Compulsory insurance
Professional Indemnity Insurance
Long-term insurance (e.g. pensions)
Certain claims for injury

Question 22

What policies is protection 90% for?(FSCS)

Answer 22

General insurance advice and arranging

Question 23

What policies have no protection at all? (FSCS)

Answer 23

Goods in transit, marine and aviation
Credit insurance

Question 24

What is run-off?

Answer 24

Prevents a company from taking any further business if they fail to meet requirements from the regulator

Question 25

What do insurers have to ensure when writing overseas?

Answer 25

That they have to comply with local regulators’ requirements

Question 26

What is ESG?

Answer 26

Environmental, Social and Governance

Question 27

What is ‘whistle blowing’

Answer 27

Public allegation of a firm’s concealed misconduct

Question 28

What Act does ‘whistle blowing’ come under?

Answer 28

Public Interest Disclosure Act 1998 (PIDA)

Question 29

What is the SYSC?

Answer 29

Senior Management Arrangements, Systems and Controls

Question 30

What is the MLRO?

Answer 30

Money Laundering Report Officer

Question 31

What is the SMCR?

Answer 31

Senior Managers and Certification Regime
It lies in within SYSC