Topic 21 Conduct Of Business Standards 2 Part 2 Flashcards

1
Q

What activities are covered by the Lending Standard Board (LSB)?

A
  • Unsecured Loans
  • Credit Card & Charge Cards
  • Current Account Overdrafts
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2
Q

What are all the below in relation to the standards of lending practice?

  • Consumer Credit Act 1974
  • Consumer Credit Regulations 2010
  • FCA’S Consumer Credit Sourcebook (CONC)
  • The Equality Act 2010
A

What regulated firms must comply with

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3
Q

What key requirement of the Standards of Lending Practice is this?

Customers have access to product & Services that have been designed to take into account their circumstances

A

Product & Service Design

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4
Q

What key requirement of the Standards of Lending Practice is this?

Customers will only be provided with a product that is affordable & meets their needs

A

Product Sale

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5
Q

What key requirement of the Standards of Lending Practice is this?

Customer requests will be dealt with in timely, secure & accurate manner. Information provided will be clear & detail any action required by the customer

A

Account Maintenance & Servicing

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6
Q

What key requirement of the Standards of Lending Practice is this?

Customers will be helped to manage finances through proactive & reactive measures designed to identify areas of financial stress

A

Money Management

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7
Q

What key requirement of the Standards of Lending Practice is this?

Customers in financial difficulty will receive appropriate support & fair treatment

A

Financial Difficulty

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8
Q

What key requirement of the Standards of Lending Practice is this?

Firms are expected to have a formal strategy for dealing with vulnerable customers

A

Consumer Vulnerability

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9
Q

What key requirement of the Standards of Lending Practice is this?

Firms are expected to put in place policies & procedures that ensure customers receive a fair outcome when taking out a consumer credit product

A

Governance & Oversight

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10
Q

What is Basic Advice?

A

Limited form of advice that applies to stakeholder products

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11
Q

What are the characteristics of basic advice?

A
  • Focuses on one of more of a clients products
  • Does not involve analysis of client’s circumstances that are linked to those needs
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12
Q

What are Stakeholders Products?

A

Products covering short & long term low cost products that are lower risk and simple

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13
Q

Who are Stakeholders Products aimed at?

A

People with a lower understanding of investments or concerns about investing

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14
Q

Regarding Basic Advice the below is what?

  • Reasonable steps have been taken to assess client’s answers to scripted questions
  • Reasonable grounds for believing a stakeholder pension is suitable for the client
  • Firm believes the client understands the basis upon which advice is given
A

When a stakeholder product can only be recommended

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15
Q

Basic Advice is suitable for customers when?

A
  • Have their priority needs meet
  • Have disposable income
  • Don’t want holistic assessment of their financial situation
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16
Q

Is recommendation summary required to be given to a customer for basic advice?

A

Yes

17
Q

For how many years must a firm keep records to show it has given basic advice?

A

5 years

18
Q

What type of advice is this?

Advice or Information that does not relate to a particular product or investment & does not meet the characteristics of regulated advice

A

Generic advice

19
Q

What type of advice is this?

At the request of a customer, advice & recommendations related to a specific need or investment

A

Focused Advice (Limited Advice)

20
Q

What type of advice is this?

  • Limited advice by the firm providing it to one or more of the customers needs
  • Does not involve analysis of the customers circumstances (not directed related to their needs
A

Simplified Advice

21
Q

What is a Robo Advice?

A

Advice provided with minimal customer interaction

22
Q

Why would Robo Advice be attractive to some people?

A

Low costs of service

23
Q

True or False

There is a degree of self regulation in regards of standards of lending practice

A

True

24
Q

According to MCOB 3A: Financial Promotions & Communications with customers how long should record of non-real time financial promotions be kept for?

A

12 months

25
Q

Commited Expenditure is classed as?

A

Repayments on credit agreements & other contractual arrangements

26
Q

The below are what type of expenditure?

  • Food
  • Housekeeping costs
  • Utilities
  • Telephone
  • Council Tax
  • Building Insurance
  • Ground Rent & Service Charges
  • Essential Travel
A

Basic Expenditure