The FCA handbook

Question 1

What financial recourses are financial firms subject to?

Answer 1

Must maintain brought resources to cover risks that that result from the way in which they conduct their business

Question 2

On what basis, did the capital requirements directive decided capital into three tiers?

Answer 2

Based on loss absorbency and performance of capital

Question 3

Why does the FCA have rules regarding inducements under COBS2

Answer 3

To ensure all intermediaries as not swayed by any incentives

Question 4

As a result of the Mortgage Credit Directive, firms but now provide a binding mortgage offer and a minimum reflection period of how May days?

Answer 4

7 days

Question 5

Why is the FAC concerned with a persons close links under threshold conditions within the FCA handbook?

Answer 5

To ensure they will not prevent the FCA’s effective supervision of the person

Question 6

What fees are due from authorised firms?

Answer 6

Application and special project fees
Financial ombudsman service
Financial services compensation scheme
money and pension services scheme

Question 7

Firms must ensure they maintain resources to cover risks they carry out as required by:

Answer 7

The capital requirements directive

Question 8

Regulated larger firms are required to carry out a ________________ and _____________ as required by the Aprils requirements directive to ensure they maintain resources to cover risks.

Answer 8

Risk assessments and stress testing scenarios

Question 9

What is MIPRU?

Answer 9

Sets out the professional indemnity insurance and CRRs for home finance providers and intermediaries and general insurance intermediaries

Question 10

If a provider gives any benefits or inducements to an intermediary how long must they keep records for?

Answer 10

5 years

Question 11

How does the ICOBS categorise insurance products?

Answer 11

General insurance
Pure protection
Payment protection insurance

Question 12

Under ICOBS rules, who is responsible for making sure an intermediary is authorised to deal with an insurer?

Answer 12

The insurer must make sure that any intermediary it deal with is authorised

Question 13

If a firm passes a mortgage leads to an authorised person for a fee, does that firm require FCA authorisation?

Answer 13

No authorisation is required as an introducer as they are not advising the client

Question 14

What is specifically exempt from the consumer credit act 1974, and who can apply to be exempt?

Answer 14

Building societies are specifically exempt
Bodies where loans are secured on land

Question 15

The FCA is required to notify a person when they are the subject of an investigation. Under which circumstances would the FCA not have an obligation to notify the person?

Answer 15

Investigations on:
Possible insider trading
Market abuse
Misleading statements

Question 16

How does the FCA determine the level of periodic fee to charge an authorised firm?

Answer 16

Based on the areas the firm has permission to advise on and the income the firm received under each product area

Question 17

How long it the cooling off period for a sale to rent back agreement?

Answer 17

14 days

Question 18

Under the Mortgage credit directive what is the name given to a product disclosure document?

Answer 18

European standardised information sheet

Question 19

Who is subject to client money rules?

Answer 19

intermediary firms who receive and hold money on behalf of clients

Question 20

If the FCA has suspicions about a firm, can an enforcement officer enter premises and remove original documents from a firm without permission?

Answer 20

Only if enforcement officer has a warrant to enter premises and take documents by force if necessary

Question 21

How do the FCA and Compensation and Markets Authority work tog their in considering fairness of standard terms in financial services contracts?

Answer 21

If the FCA considers the CMA better placed to deal with a matter they will then pass the case on