Csi Cco Qualifying Exam - Rules/acts

Front 1

IIROC RULE 37 & IDA BULLETIN 3040

Back 1

Require that members participate in Alternative Dispute Resolution, which involves the arbitration of complaints through either the OmbudsNetwork or the national arbitration program

Front 2

IIROC Rule 3100

Back 2

IIROC requirements regarding internal dealer member investigations

Front 3

UMIR Rule 10.16

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Gate Keeper Obligations: any Participant or Access Person who notes conduct that might involve a breach of SRO rules must immediately report the matter to their Supervisor or compliance staff, who must then conduct a review in accordance with the firms trade desk policies and procedures.

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IIROC Rule 20

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The IIROC hearing process is regulated by this rule, which deals with issues such as hearing panels, pre-hearing conferences, and types of disciplinary hearings, penalties and appeals.

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UMIR Rule 10.2

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The investigative powers of IIROC Market Regulation

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UMIR Part 10.5

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Lists the Sanctions that may be imposed upon a Participant or Regulated Person for non compliance.

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UMIR Rule 10.3

Back 7

Provides for an extension of responsibility for breaches by a firm and its employees where appropriate.

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The Criminal Code

Back 8

Protects employees who inform, or who assist law enforcement in investigating cases of capital markets fraud, by making employer-related intimidation an offence. (whistle-blowers)

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IIROC Rule 38

Back 9

-Requires that firms maintain an internal record of the names of all Supervisors, the scope of their responsibility and the dates for which their responsibility and authority was in effect.

-Requires the CCO to make an annual report to the Board of Directors regarding the effectiveness of the dealer members policies and procedures and its state of compliance with various regulatory requirements.

Front 10

IIROC Rule 29.7(5)

IIROC Rule 29.7

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-Requires that sales related literature, regardless of format, be retained for two years from the date of creation and that correspondence, including emails, be retained for a period of five years from the date of creation.

-Contains detailed general requirements in relation to advertising, sales literature and correspondence.

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IIROC Rule 200

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-Sets out the routine types of records that a firm must keep regarding its business and relationship with its clients

-Also has requirements regarding the recording of orders.

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IIROC Rules 2500 & 2700

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-Retail Trading Supervision

-Institutional account supervision

-Set out the record keeping requirements for retail & institutional accounts with regard to account opening, reviews of account activity and client complaints.

-Addresses specific derivatives supervisory requirements.

-provides reasonable assurance against unauthorized discretionary trades.

- also addresses front running

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IIROC Rule 3400

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requires that firms maintain records of any flow information between research & investment banking departments, although the form of such record keeping is not specified.

Front 14

IIROC Rule 40

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Sets out the record keeping and reporting requirements (including Comset) for registrants and dealer members regarding certain material changes to registration information, client complaints, internal investigations, civil actions, criminal & regulatory proceedings.

Front 15

UMIR Sections 10.11 & 10.12

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Set out audit trail and record keeping requirements with respect to orders and trades. Orders must be retained for seven years and in a readily accessible location for the first two years.

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UMIR Rule 7.1

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- If a supervisor or compliance staff receives a report, a review must be conducted in accordance with the deal members Trade Desk Policies & Procedures.

-Minimum Compliance Procedures for trading on a marketplace, sets out the minimum procedures a trade desk compliance program must follow when trading in markets subject to UMIR.

-require a periodic review of a sample of proprietary and employee trades prior to large client orders and transactions that will affect the market.

Front 17

PCMLTFA

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Proceeds of Crime (Money Laundering) & Terrorist Financing Act impose direct reporting, client identification and record keeping requirements upon securities dealers to support the detection, investigation & prosecution of money laundering and terrorist financing offences.

Front 18

IIROC

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Investment Industry Regulatory Organization of Canada. Through audits and reviews determines dealer members culture of compliance measured by observing members activities/responses to a number of variables.

Front 19

IIROC Notice 09-0100

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Firms should carefully consider the potentially negative impact of employee reductions in compliance and other control functions.

Front 20

IIROC Rule 2600

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-Internal control policy statements

-Mandates derivative risk management standards.

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IIROC Rule 29.27 (a)(v)

IIROC Rule 29.27 (a)

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-Requirements to have adequately qualified supervisory personnel.

-requires dealer members to establish a supervisory system.

-Requires dealer members with various business locations to conduct periodic on-site reviews of business location supervision & record keeping as necessary depending on the types of business and supervision conducted at the business location.

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IIROC Rule 17.16

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Business Continuity Planning (BCP) which requires a firm to have a BCP that ensures client access to their assets within 48 hours of a significant business disruption.

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IIROC Rule 29.1

IIROC Rule 29

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Requires firms and their representatives to:

-Observe high standards of ethics and conduct in the transaction of their business

-Not engage in any business conduct or practice which is unbecoming or detrimental to the public interest.

-Be of such character and business repute and have such experience and training as is consistent with the foregoing standards.

Front 24

IIROC Rule 1300.2

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Requires the handling of client business to be within the bounds of ethical conduct, consistent with just and equitable principles of trade and not detrimental to the interests of the securities industry.

Front 25

Criminal Code s.382

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Market manipulation - creating false or misleading appearance of trading activity, liquidity or market pricing in a security is an offence and carries a maximum penalty of 10 years imprisonment.

Front 26

IIROC Rule 3000

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Code of Conduct for dealing in Repo Markets, repo activities.

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IIROC 3200

Back 27

Discount brokerage activities not subject to suitability requirements.

Front 28

IIROC Rule 2800

Back 28

-Firms dealing in fixed income products. Code of Conduct for Corporation Dealer Member Firms Trading in Wholesale Domestic Debt Markets, which prescribes standards for trading in wholesale domestic Canadian debt markets.

-delineate specific types of debt market activity that are improper, with the expectation that dealer members will implement supervisory and compliance systems that are reasonably designed to prevent or detect such activity.

Front 29

IIROC Rule 2800B

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-Retail Debt Market Trading and Supervision, enumerates corresponding standards for activity in the retail domestic fixed income market, and also requires firms to establish mark-up, mark down and commission guidelines for retail fixed income trading activities, and supervise these pricing practices to ensure that any deviations from the guidelines are justified.

-delineate specific types of debt market activity that are improper, with the expectation that dealer members will implement supervisory and compliance systems that are reasonably designed to prevent or detect such activity.

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The Montreal Exchange (MX)

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Deals exclusively in non-agricultural derivatives.

Front 31

ICE Futures Canada Inc.

Back 31

Formerly the Winnipeg Commodity Exchange, deals exclusively with agricultural derivatives.

Front 32

IIROC Notice 09-0109

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Require firms to include on trade confirmations sent to retail clients in respect of OTC transactions a statement indicating they have earned remuneration on those transactions unless the amount of any markup or markdown, commissions and other service charges is disclosed on the confirmation.

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UMIR Rule 2.1

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-Conducting business openly and fairly

-provides that market participants who intentionally organize their business and affairs to circumvent the application of a rule may be considered to have engage in conduct that is contrary to just and equitable principles of trade.

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UMIR Rule 2.2

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-Manipulative and deceptive trading

-any market activity that is created and not the result of the entry of bona fide orders may be interpreted as manipulative and deceptive.

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UMIR Rule 7.7

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-Along with M&A related restrictions, designed to prevent inappropriate price support while acting as an underwriter or selling agent in the course of a distribution

-sets out the requirements and restrictions that apply during the course of transactions such as distributions, and provides direction on market stabilization and market balancing activities during this period.

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UMIR Rule 2.3

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prohibits the entry of an order or execution of a trade where it is known, or ought to be known that doing so would not comply with any applicable securities legislation, SRO rule, requirement of the marketplace or any other provision of UMIR.

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UMIR Rule 10.10

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requires firms to calculate, as of the 15th and last day of each calendar month, the aggregate short position of each individual account in respect of each listed security and quoted security.

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UMIR Rule 4.1

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contains exceptions to the general rule in relation to the markets regulated by IIROC, including trades in relation to hedges, arbitrage and pre existing, legally binding obligations.

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UMIR Rule 10.4

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extends the rules prohibiting front running to trading by related entities of the dealer member, which includes the firm accepting the order and its employees, as well as a competing firm and its employees who have advance knowledge of the order.

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UMIR Rule 6.3

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All orders 50 or fewer standard trading units must be transmitted immediately to the marketplace.

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UMIR Rule 6.4

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a Participant acting as principal or agent may not trade, no participate in a trade, in a security by means other than the entry of an order on a marketplace.

Front 42

MIR Rule 8.1

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Governs client-principal trades on a public equity marketplace.