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Ro1 Regulations And Ethics Of The Finanacial System > Things I Need To Revise > Flashcards

Things I Need To Revise Flashcards

1
Q

What doesn’t the FCA cover?

A

Buy to let mortgages unless consumer ones
Occupational pensions
Claim handlers

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2
Q

What are the 3 pillars of risk based supervision?

A

Proactive
Event driven
Thematic

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3
Q

Out of the 10 principles of supervision. What are the first 5?

A

Fair Outcomes
Forward looking
Concentrate Resources
Right Spirt
Judgment based

-Ensure fair outcomes.
-Forward-looking and preemptive.
-Concentrate resources.
-Judgment based approach.
-Ensure firms act in the right spirit.

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4
Q

What is a section 166 report?

A

Skilled person report. Used as disciplinary measure by the FCA.

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5
Q

What are the 9 blocks in the FCA handbook?

A

High-level standards
Prudential standards
Business standards
Regualtory process
Redress (complaints)
Specialist
Listing prospectus and disclosure
Handbook guides
Regualtory guides

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6
Q

Out of 9 areas of SYSC (systems and control)? What are the first 5

A

General requirements
Employees and staff
Compliance
Risk control
Outsourcing

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7
Q

What are the 5 threshold conditions to become a UK firm?

A

UK head office
Effective supervision
Appropriate resources
Individuals - fit and proper
Buisness - Appropriate business model

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8
Q

What do prudential general rules apply to?

A

Banks
Building societies
Investment firms

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9
Q

What is COBS

A

Conduct of business sourcebook

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10
Q

What is ICOBS

A

Insurance conduct of business source book

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11
Q

What are the cancellation perisods?

A

14 days for general insurance and ISAs

30 days for pure insurance

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12
Q

What is general insurance?

A

Home
Travel
Car
Etc.

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13
Q

What is pure insurance?

A

Life
Critiacal
PPI
Etc.

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14
Q

What allows loans to be regualted under MCOBs

A

Made to an individual or a trustee
Secured by first legal charge
At least 40% of the property is used as domicial.

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15
Q

What are the 4 rules for senior managers?

A

SC1 Ensure the business of the firm is controlled effectively.

SC2 Ensure the firm complies with the relevant requirements and standards of the regulatory system

SC3 Ensure deligation of responsibility is to an appropriate person and that you oversee the discharge of the responsibility effectively.

SC4 Disclose effectively any information that the FCA or PRA would reasonably expect notice of.

Control
Complies
Delegates
Discloses

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16
Q

What are the 6 cultural drivers?

A

Leadership
Strategy
Decision Making
Controls
Recruitment and T&C
Reward

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17
Q

What is CSR, and what does it aim to do?

A

Corporate social responsibility.

Create prove to me culture.

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18
Q

What is CASS

A

Client Assets

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19
Q

Who are complaints against the FCA made to?

A

The complaints commissioner

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20
Q

What are the statutory time frames for authorisation?

A

6 months if completed properly
12 months if not completed properly

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21
Q

Does a partner in a firm need to reapply for authorisation if their partner dies?

A

No, they become asole trader as this is a special exception to having to reauthorise if there is a fundamental change to a firm.

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22
Q

What is SM&CR?

A

Senior Management and Certification Regime

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23
Q

How often should a fit and proper check be completed?

A

Annually

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24
Q

How long should MiFID firms keep training records?

A

5 years after leaving the firm

3 years for non-MiFID

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25
Q

How long should records be kept for?

A

Indefinitely - pension transfers, opt-outs, and FSAVC (Freestanding additional voluntary contributions) contracts.

6 years for promotion approvals

5 years for most others

3 years MiFID

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26
Q

How does the FCA receive reports?

A

Via GABRIEL

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27
Q

What 5 reports should the FCA receive?

A

Capital adaquacy
Complaints - biannualy
Type and volume of business
Client funds held
Persistency levels (number of polices cancelled, including in cool off perisod)

28
Q

What are the complaint time-scales?

A

Acknowledgement within a reasonable timeframe. (Legacy 5 days)

Holding letter after 4 weeks if not resolved.

8 weeks, either final response or further holding letter, including how to go to the FOS.

29
Q

What are the time frames to go to the financial ombudsman service?

A

Within 6 months of receiving the right to go to the FOS

Within 6 years of the event

Within 3 years, if becoming aware of the event after.

30
Q

How much should the FSFC pay for long-term and general insurance?

A

Long term -
provider failure 100%
Intermediary failure 90%

General -
compulsory 100%
Non-compulsory 90%

31
Q

Where can a customer get non-regualted advice?

A

The money helper who is also responsible for pensionwise.

32
Q

What are the customers for general insurance businesses?

A

Consumer
Commercial
Customer - both

33
Q

What are the customers for home-finance business?

A

Just customers.

34
Q

Money laundering regulations would require evidence of identity to be obtained under customer due diligence rules for

A

The sale of a stakeholder pension plan with a monthly premium of £25

The sale of a pension valued at £70,000 from a defined benefit scheme to a SIPP with a different provider.

35
Q

Name 3 elements of EU law and one that is not

A

Directives
Decisions
Regulations

Instruments

36
Q

How many treating customers’ fairly objectives have been laid down?

A

6

37
Q

How may rates of IHT are there

A

4

38
Q

What are the 3 primary rates of IHT and the final special rate?

A

40% death rate
20% chargeable lifetime transfers
0% nil rate band

36% when 10% donated to charity

39
Q

How are FCA fees calculated

A

Periodic fee = (tariff base rate data for firm) applied to (fee-block tariff rates)

40
Q

For a micro-enterprise to be an eligible complainant, what must they do?

A

Have less than 10 employees
Have a turnover or annual balance sheet of less than 2 million euros

41
Q

Out of the 10 principles of supervision. What are the last 5?

A

Buisness model and culture
Individual acountabilty
Robust failsafe
Communicate openly
Joined up approach

-Examine business models and cultures.
-Emphasis on individual accountability.
-Robust when things go wrong.
-Communicate openly with industry, firms, and consumers.
-Joined up approach.

42
Q

Out of the 9 SYSC. What are the last 4?

A

Record Keeping
Conflict of interest
Whistle blowing
Remuneration

43
Q

What regualted buisness do the COBS rules apply to?

A

Regualted pensions

44
Q

What should be discussed during first contact?

A

Debt levels
Investment objectives
Tolerance of risk
Pension rights

Explanation on how advice will be paid for.

45
Q

What is not a requirement for first contact?

A

Know your customer
A full fact find

46
Q

When should sutability reports be given for personal pensions and stakeholder pensions?

A

14 days after contract is concluded

47
Q

When should sutabilty reports be given for life polices?

A

Before the contract is concluded.

48
Q

What is the comparison between standalone cover and combined?

A

Standalone will be more expensive

49
Q

What will happen with indexation?

A

It will be more expensive now and in the future

50
Q

What are the rules pertaining to giving projections?

A

Based on a reasonable number of realistic simulations.
Supported by objective data
Risk warnings - figures are examples and not a reliable indicator of future results.
Gross figures can be used, providing the effects of charges are shown.

51
Q

How many creditors are required to agree an IVA?

A

75%

52
Q

How often are IVAs reviewed?

A

Yearly

53
Q

What is the maximum fine for data breaches?

A

£17m or 20m euros

54
Q

Who wouldn’t need FCA authorisation?

A

People with an intoducer exclusion

55
Q

What does criminal law do?

A

Defines the rights of the public and their safety

56
Q

What does civil law do?

A

Defines the rights of parties to a transaction

57
Q

What are outside of notification requirements?

A

Insider dealing
Market abuse or misleading statements
Breaches on the restriction on financial promotion or promoting collective investment schemes

58
Q

What is the nil rate band on IHT

A

325,000

59
Q

Who is pensionwise available to?

A

People over 50 with defined contributions pension schemes.

60
Q

When will a firm have to complete a CMAR?

A

Equal to or over £1m cash or over £10m in assets.

61
Q

How often are P1 firms required to perform prudential tests?

A

Every 24 months

62
Q

With an uncrystalied funds pension, how much would be tax-free on a lump sum?

A

25%

63
Q

What is not covered by COBS

A

Deposits
General insurance
Pure protection life insurance
Reinsurance

64
Q

In the FCA high level standards what is PRIN?

A

Principles for buisness

65
Q

What are the rules around data protection?

A

Any relevant filling system subject to appropriate protection.

Anyone may obtain a copy of their data held by completing a subject access request

66
Q

What is the CRR for an MiFID exempt firm?

A

£20000

Ro1 Regulations And Ethics Of The Finanacial System (14 decks)

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