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16 Cards in this Set
- Front
- Back
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1. Name the three operational objectives of the FCA.
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1. Protect consumers; 2. enhance the integrity of the UK financial system; 3. help maintain competitive markets and promote effective competition in the interests of consumers. |
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2. What is the difference between ‘rules’ and ‘guidance’ in the FCA Handbook?
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2. Rules create binding obligations on authorised firms. Guidance provides assistance in understanding how to abide by the rules.
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3. How, according to the Principles for Businesses, must authorised firms behave in their dealings with the regulators?
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In an open and co-operative way, disclosing anything that the FCA or PRA might reasonably expect to be told.
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4. What, according to the FCA, must be ‘embedded into the culture and dayto-day operations’ of authorised firms?
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4. The principle of Treating Customers Fairly (TCF).
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5. Whose rights are protected by the Public Interest Disclosure Act 1998? (a) Borrowers who fall into arrears.(b) Whistle-blowing employees.(c) Bank/building society deposit account holders. |
5. (b)Whistle-blowing employees.
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6. What are the two forms of market abuse defined by the EU?
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6. Insider dealing, where a person who has information not available to other investors makes use of that information for personal gain; and market manipulation, where a person knowingly gives out false or misleading information in order to influence the price of a share for personal gain.
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7. Which of the following is NOT a ‘regulated investment’ under the Financial Services and Markets Act 2000? (a) Works of art.(b) Funeral plans.(c) Insurance policies. |
7. (a)Works of art.
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8. What is ‘Basel II’?
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8. An international standard for the capital adequacy requirements of financial institutions.
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9. ‘The risk of losses from failed or inadequate internal processes, people and systems, or from external events.’ This is a description of what?
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9. Operational risk.
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10. What European legislation determines the capital adequacy requirements of investment businesses?
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10. The Capital Requirements Directive (CRD).
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11. In relation to the FCA’s enforcement powers, explain the difference between ‘restitution’ and ‘redress’.
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11. Restitution refers to the FCA’s power, with a court order, to require a person or firm to forfeit any profit made from contravening an FCA rule. Redress refers to the situation where identifiable customers have made a loss as a result of contravention of a rule and the FCA, again with a court order, can require the loss to be made good.
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12. The role of financial adviser is a ‘controlled function’. Which category of controlled function is it?(a) Required function.(b) Management function.(c) Customer function.
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12. (c)Customer function.
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13. During what hours can an unsolicited sales call be made by a financial adviser?
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13. At an appropriate time (taken to be between 9am to 9pm Monday to Saturday)to an existing client.
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14. What is an ‘eligible counterparty’?
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14. An eligible counterparty is someone who is ‘in the business’, i.e. someone who transacts the same kind of business for their own customers as they are proposing to transact for themselves.
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15. An adviser has just sold a personal pension plan to a client. What is the minimum period for which the factfind and related information must be retained?
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15. Five years.
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16. If the current Bank of England base rate is 4.5 per cent, what is the minimum rate of interest that can be offered on a ‘stakeholder’ cash deposit scheme?(a) 1.5 per cent.(b) 2.5 per cent.(c) 3.5 per cent.
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16. (c)3.5 per cent.
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