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51 Cards in this Set
- Front
- Back
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What is self regulation? |
A financial company (Stock market) creating rules for it's members and policing their implementation |
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What are the main purposes of regulation? |
Maintain and promote fairness Promote understanding Provide protection Minimise crime and misconduct Reduce systemic risks Assist in maintaining market stability |
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Explain the Lamfalussy Process |
EU tiered approach for new regulations. Consists of 4 levels |
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What are the 4 stages of the Lamfalussy Process? |
Level 1 - Framework (Idea) Level 2 - Technical Details Level 3 - International Regulators Co-ordination Level 4 - Compliance and enforcement at national level |
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What is the ESMA? |
European Securities and Markets Authority |
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What is the FSMA? |
Financial Services and Markets Act. |
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What is the ESMA? |
European Securities and Markets Authority |
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What are the 11 Principles of Business? |
Integrity |
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What are Controlled Functions? |
Those involved in dealing with customers or their investments, key managers in a firm including finance, compliance and risk |
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What are the FCA's Controlled Functions? |
Governing Function (Directors) |
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What are the 7 Statements of Principles for Approved Persons? |
Act with integrity |
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What training standards do firms have to meet according to the FCA? |
It is the firms responsibility to ensure staff are qualified for their role |
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What is Money Laundering? |
The process of turning dirty (criminal activity) money in to money that appears to be legitimately acquired |
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What are the 3 stages of Money Laundering? |
Placement - Placing the cash in to an account |
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What is the FSMA? |
Financial Services and Markets Act. |
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Who are the FSA? |
Financial Services Authority. |
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Who are the FPC? |
Financial Policy Committee |
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Who are the PRA? |
Prudential Regulation Authority |
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Who are the FCA? |
Financial Conduct Authority |
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What are the FCA's 3 statutory objectives? |
Protect consumers |
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What does the FSMA look for when appointing an "Approved Person"? |
Honesty, integrity and reputation |
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Who do not have to be FSMA approved to provide financial services? |
The Bank of England |
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What is meant by Approved Persons? |
An individual that has been approved by the FCA to perform a controlled functions |
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Who are the FATF? |
Financial Action Task Force.
Issue recommendations to ensure anti money laundering efforts are consistent globally |
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What is the POCA? |
The Proceeds of Crime Act.
Provides for the confiscation or civil recovery of the proceeds from crime and contains the principal money laundering legislation in the UK. |
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What is the Terrorism Act? |
Etablishes a series of offences related to involvement in arrangments for facilitating funds for terrorism purposes |
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What are the Money Laundering Regulations? |
Customer due diligence Reporting Record-keeping Internal control Risk assessment and management Compliance management Communication
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What is the FCA Handbook? |
Explains the requirements for firms to have effective systems and controls to prevent financial crime |
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What is the JMLSG? |
Joint Money Laundering Steering Group
An industry body made up of 17 financial sector trade bodies, they offer guidance on offences with money laundering |
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Money Laundering Reporting Officer
Responsible for overseeing the firms compliance with the regulators rules on money laundering |
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Who are SOCA? |
Serious Organised Crime Agency |
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What are the Customer Due Diligence measures? |
Identifying the customer Identifying the beneficial owner Obtaining information on the purpose of the business venture |
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What are the two Customer Due Diligence categories? |
Simplified Due Diligence Enhanced Due Diligence |
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What are PEPs? |
Politically Exposed Persons
Individuals who hold or have held a senior political role |
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How long are records kept of a customers identity? |
5 years |
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Explain Identity Fraud and Identity Theft |
Identity Fraud - Obtaining GOODS by using anothers identity for deception Identity Theft - Using someone's information without consent |
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What is Insider Dealing? |
The trading of a public company's stock or other securities by individuals with access to non-public information about the company |
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What is Insider Information? |
Knowledge about a publicly traded company that could be used to an investor's advantage. |
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What is Market Abuse? |
Where financial investors have been unreasonably disadvantaged, directly or indirectly, by others who:
Have used information which is not publicly available (insider dealing)
Have distorted the price-setting mechanism of financial instruments
Have disseminated false or misleading information |
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What is the Data Protection Act? |
Details how personal data should be dealt with to protect the rights of the person concerned |
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What must a firm ensure if it outsources it's work? |
The organistation taking on the work must be able to carry out the work in a secure way |
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How long does a company have to respond to a complaint? |
A final response must be given within 8 weeks |
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What is a Breach? |
Any action (or inaction) which conflicts with regulatory requirements |
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What do the Financial Ombudsman Service do? |
Resolve complaints about financial services firms quickly and with minimum formality |
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What is the total amount a compensation payment can be from the Financial Ombudsman Service? |
£150,000 |
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Under what circumstances can the Financial Ombudsman Service offer compensation? |
Financial loss, pain or suffering Damage to reputation Distress or inconvenience |
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What is the FSCS? |
Financial Services Compensation Scheme
Pays compensation to depositors in the event of default in a bank or building society |
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What is the maximum the FCSC can compensate? |
£50,000 per person per firm for investments £85,000 for bank deposits |
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What are the 6 Treating Customer Fairly outcomes? |
1 - Consumer confidence in fair treatment of customers 2 - Retail products and services designed to meet identified groups 3 - Clear information provided to consumers 4 - Suitable advice given 5 - Performance of products an acceptable standard 6 - No unreasonable post sale barriers |
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What are the 4 key principles of professional integrity? |
Open Honesty Transparent Fair |
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What is the CISI code of conduct? |
Chartered Institute for Securities and Investment
Requires it's members to meet the standards set out within it's institute principles |
