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In general, regulation should comply with which ONE of the following requirements to fulfil its objectives?
In which ONE of the following ways can regulators reduce the risk of failure of financial institutions?
Which of the following statements with regard to regulation in South Africa is correct
i)Registration of companies takes place at the office of the Registrar of Companies, which forms part of the Department of Trade and Industry.
ii)The Council for Overseeing Recognised and Statutory Ombudsman Schemes regulates the various ombudsmen created by industry or by statute
iii)Banks are regulated by the Banking Supervision Department of the SA Reserve Bank in respect of their banking (deposit-taking) activities.
iv)Supervisory bodies must provide the Financial Intelligence Centre with any information on money-laundering they may obtain.
Friendly societies are regulated by the Financial Services Board in which of the following manners?
i)Ensuring that a friendly society’s rules meet prescribed guidelines.
ii)Restriction the contributions that can be made by members to the society.
iii)Analysing the annual audited financial statements of friendly societies.
iv)Managers of friendly societies must comply with annual reporting requirements.
Which of the following are objectives of the Financial Intelligence Centre?
i)Identification of the proceeds of unlawful activities.
ii)Prosecuting persons involved in money laundering.
iii)Combating of terror financing.
iv)Ensuring stability in the financial services sector.
Which of the following are deemed a regulated person under the Financial Market’s Act
i)Exchange
ii)Issuer
iii)Authorised user
iv)Participant
The requirements for an exchange license include which of the following?
i) All transactions must be supervised through surveillance systems.
ii) Record integrity must be safeguarded through security back-up procedures.
iii) The proper management of market risk must be provided for in the exchange rules.
iv) Compensation to clients must be ensured by insurance, a guarantee or compensation fund.
Which of the following statement with regard to the funding and control of an exchange are correct?
i)Distribution of surplus funds of the exchange may only be made on written consent of Registrar.
ii)An exchange may impose a transaction levy to maintain the insurance, guarantee or compensation fund.
iii)No person may hold more than 10% of an exchange shares without approval of the Registrar.
iv)Each member of a controlling body of an exchange owes a fiduciary duty to the exchange.
The Financial Markets Act imposes which of the following duties and function on an exchange?
i)Enforcing the exchange’s rules and listing requirements
ii)Supervising compliance by clearing houses with the Act and the rules
iii)Issuing internal control procedures in terms of its rules.
iv)Registration of central securities depositories in terms of the rules.
An exchange may require an issuer to disclose any information about the securities or the affairs of the issuer. What action can be taken against the issuer by the exchange, if the issuer refused to make the necessary disclosure?
Which of the following aspects must be included in the rules of an exchange?
i)Restriction of the activities of different categories of authorised users.
ii)The circumstances under which transactions may be repudiated or declared void.
iii)The manner in which authorised users must conduct their business generally
iv)The supervision by an exchange with the duties imposed by the Financial Intelligence Centre Act
Which ONE of the following statements with regard to the duties, restriction and prohibitions imposed on authorised users is correct.
Which ONE of the following statements with regard to the requirements pertaining to auditors and accounting records of regulated persons are correct?
Which ONE of the following actions would be considered insider trading in terms of the Financial Markets Act?
A person who knows that he or she has inside information and who discloses the inside information to the insider trader, shall be jointly and severally liable with the insider trader for which of the following amounts?
i)The amount of the profit or amount of loss avoided by the insider trader.
ii)A sum determined by the court but not exceeding four times the profit made or loss avoided.
iii)The commission or other consideration received.
iv)The costs of the suit.
Who is responsible for entering the required information into the sub register that forms part of the register of members?
Which of the following statements with regard to the duties and functions of a central securities depository (CSD) are correct?
i)Non-compliance with the rules of a CSD must be reported to the Registrar.
ii)A CSD must administer and maintain a record of all uncertificated securities deposited with it
iii)A CSD may enter into an agreement with an external securities depository for the provision of securities services
iv)A participant must be notified in writing of all entries made in the participants’ central securities account.
Which ONE of the following statements with regard to participants, nominees and issuers of uncertificated securities is correct?
What is an entity that is allowed to maintain a centralised electronic database of transaction data called?
When been ordered to inspect an authorised user, the inspector may-
Which of the following statements with regard to the duties imposed on credit rating agencies (CRA) are correct?
i)Credit ratings and decisions to discontinue a rating must be published impartially and timeously.
ii)Credit ratings for structured finance instruments must be clearly differentiated from ratings for entities.
iii)A CRA must disclose every 6 months the details about the historical default rate of rating categories.
iv)When publishing a credit rating, the attributes and limitations of the rating must be stated clearly and prominently.
Which of the following powers does an inspector have with regard to an institution under the inspection of financial institutions Act?
i)Only on production of a warrant enter any premised of the institution and search for documents.
ii)Examine, administer an oath or affirmation with regard to any other person that the inspector believes may have information relating to the inspection.
iii)Retain seized documents for a period not exceeding six months on the issue of a receipt.
iv)Open any strong room, safe or other container in which he or she suspects any documents are kept.
Which of the following enforcement actions may the registrar take after an inspection?
i)Hand the matter over to the National Director of Public Prosecutions.
ii)Refer the matter to the Enforcement Committee.
iii)Make known the status and outcome of an inspection.
iv)Apply for the appointment of a curator.
Which ONE of the following constitutes intermediary services?
Which ONE of the following statements with regard to the Key Individual function and appointment is correct?
Which of the following requirements apply equally to all categories of financial services providers?
What is the experience requirement for Key Individuals in Category IV according to the FAIS Act?
Financial services provider A provides advice in long term insurance and wants to appoint John as representative. Which of the following experience John has can be considered in terms of the FAIS Act?
Which of the following financial soundness requirements are applicable to Category IIA Financial Services Providers (FSP)?
i)Current assets must exceed currents liabilities.
ii)Current assets must exceed currents liabilities by at least 3 million.
iii)Liquid assets must be equal to 8 weeks of annual expenditure.
iv)Liquid assets must be equal to 13 weeks of annual expenditure
Which ONE of the following statements with regard to the requirements pertaining to regulated officers as stipulated in the FAIS act are correct?
The license of Buddy Advisors have been suspended. It must have been for which of the following reasons?
i)Not appointing a Key Individual.
ii)Failing to pay a client’s claim.
iii)Not adhering to a directive issued.
iv)No longer meeting the financial soundness requirements.
Which of the following is a general duty imposed on representatives and financial services providers under the General Code of Conduct? Choose the option that is FALSE?
Which of the following are requirements for the displaying of the licences certificate as stipulated by the Code of Conduct?
i)Licence certificate must be a certified copy.
ii)Original certificate must be kept in a fire proof safe.
iii)Must be displayed prominently and in some type of frame.
iv)A copy of the licence certificate may be given to clients.
Which of the following actions are allowable under the amended Code of Conduct?
i)Product provider A pays representatives of FSP B a bonus of R800 per annum if they reach their sales target in relation to their products.
ii)Product provider A pays representatives employed by them a bonus of R1500 per annum if they reach their sales & compliance targets.
iii)Client A agrees in writing to pay representative C a fee for advised rendered during the course of the business relationship.
iv)Product provider A makes customer services training available to representatives of FSP B if they reach their sales target in relation to their products.
Which of the following statements with regard to the conflict of interest management policy are correct?
i)The policy must contain the names of any third parties in which the FSP holds an ownership interest.
ii)The policy must explain how qualifying financial interest complies with the amended Code of Conduct.
iii)The FSP must publish its conflict of interest management policy in the Government Gazette.
iv)The policy must be adopted by the Compliance Officer of the Financial Services Provider who must ensure compliance thereof.
Which of the following disclosures should be made with regard to the product supplier?
Which of the following is a definition of immaterial financial interest?
In terms of the General Code of Conduct, which action must a representative take if visits a client after he has established that it is a convenient time for the client?
Which of the following statements with regard to the requirements pertaining to the giving of advice as stipulated in the General Code of conduct are correct?
i)If advice is given to replace an existing long-term insurance policy, the issuer of the existing policy must be notified of such advice.
ii)A representative is not permitted to provide advice with respect to a financial product if a client opts not to provide all required information.
iii)A representative must only need to maintain the record of advice if a transaction is concluded as a result of advice furnished.
iv)The record of advice must include the income and expense statement of the client as well as a list of assets and liabilities.
A FSP receives money on behalf of clients. Which of the following do they need to comply with according to the FAIS Act?
Which ONE of the following statements regarding the keeping of records as prescribed under FAIS is correct?
In order for a FSP to satisfactorily resolve a client complaint, various requirements must be in place. In this regard, which of the following statements are correct?
Which of the following statements with regard to client mandates as stipulated in the Code of Conduct for Discretionary financial services providers (FSP) are correct?
i)The mandate must allow either party to the mandate to terminate the mandate after notice in writing of not more than 30 calendar days
ii)The mandate must stipulate the bank account details of the trust account in the name of the client in which the discretionary FSP must deposit
iii)The mandate must contain a general statement pertaining to the risks associated with investing in local and foreign financial products.
iv)The mandate must provide the client with the option to receive reports and statements in electronic or printed format.
A discretionary financial services provider must on request by a client, furnish information on which of the following matters pertaining to a foreign financial product?
i)The manner in which such financial product may be acquired
ii)The name and address of the foreign Ombuds scheme applicable.
iii)The jurisdictions from which the financial products may be acquired.
iv)The country in which the financial products are licensed or registered
Which of the following actions are a discretionary financial services provider permitted to take on written consent from a client?
i)Selling to a client assets owned by the FSP.
ii)Providing a client’s details to a third party.
iii)Netting of transactions
iv)Exercising voting rights to obtain control of a company.
Which of the following statements are correct with regard to the additional mandate applicable to hedge fund financial services provider (FSP)?
i)This mandate must confirm the existence and contents of the first discretionary mandate.
ii)The mandate must contain express confirmation that the client approves of the investment objectives.
iii)It must be stated in the mandate that the establishment of the relevant portfolio does not conflict with any law.
iv)The mandate must also confirm that the client approves of the utilisation by the hedge fund FSP of the process to be implemented.
Which of the following information must a financial services provider conduction short term deposit taking business provide to a client-
i)How funds may be dealt with on maturity
ii)Clients’ rights to access personal information held by the bank
iii)Closing of branches, outlets or ATM’s
iv)Possible later changes to terms and conditions
The mandate of a forex financial services provider (FFSP) must make provision for which of the following?
i)Whether the investment is self-directed or managed.
ii)Whether the return is guaranteed or not
iii)Bank details of the FFSP and foreign FFSP or clearing firm.
iv)Restrictions on withdrawals of principal amounts or profits.
Which of the following statements regarding the requirements imposed on Forex investment advisors are correct?
Which ONE of the following is an objective of King Code III?
The REready! Pack is designed to be used to prep for RE1 or RE5 or both.
The content for RE1 and RE5 overlaps as both exams test your practical knowledge of the FAIS Act and FICA.
The class is not a facilitator that is going to read the law out of a book for you.
Anna Bouhail contextualizes the content and creates an understanding of basic concepts related to law, the industry, and competency exams.
The class is structured to also instill compliance skills allowing the learner to answer practical questions.