Ethics Flashcards
1
Q
What is Rule 1 of Rules of Conduct?
A
Members must act with integrity and be honest, comply with professional obligations
2
Q
What is an example of Rule 1?
A
Open and transparent about fees as services
do not allow themselves to be improperly influenced
3
Q
What is Rule 2 of Rules of Conduct 2022?
A
Maintain professional competence ensure services are carried out by competent individuals
4
Q
What is an example of Rule 2?
A
Only undertaking work that I feel I have the knowledge skills and resources to carry out competently
developing my knowledge and skills through careers by undertaking CPD
5
Q
What is Rule 3 of Rules of Conduct 2022?
A
Members must provide good quality and diligent service
6
Q
What is an example of Rule 3?
A
Understanding clients needs and objectives before accepting any professional work
7
Q
What is Rule 4 of Rules of Conduct 2022?
A
Members should treat others with respect and promote diversity and inclusion?
8
Q
What is an example of Rule 4?
A
I always treat everyone fairly and do not judge or discriminate
9
Q
What is Rule 5 of Rules of Conduct 2022?
A
Act in public interest, maintain confidence in profession and take responsibility for actions
10
Q
What is an example of Rule 5?
A
Respond to complaints professionally
11
Q
What are mandatory obligations for RICS members?
A
- complete and log CPD
- cooperate with the RICS
- provide information reasonably requested by Standards and Regulations Board
12
Q
What are the mandatory obligations for RICS firms?
A
- publish complaints handling procedure
- previous and current work covered by PII
- arrangements to be made if sold principle can’t work
- co operate with the RICS
- provide information reasonably requested by Standards and Regulations Board
- display business literature in accordance with the RICS
13
Q
What is the RICS ethical decision tree?
A
a framework of questions that members should use when faced with a potential ethical situation
14
Q
What are some of the questions included in the RICS Ethical Decision Tree?
A
- do you have sufficient facts
- Is it in line with ROC
- have you consulted the appropriate people to inform your decision
- would you be content if your actions were made public
15
Q
How could a disciplinary procedure be triggered?
A
someone complaining to RICS, allegation from a client.
16
Q
What are the three levels of disciplinary action?
A
- action by head of regulation
- action by disciplinary panel
- action by appeal panel
17
Q
What actions might follow a disciplinary?
A
- fixed penalty notice
- reprimand
- explosion of member
18
Q
What is an example of a failure to comply with regulatory compliance?
A
failure to complete CPD
19
Q
What are the current challenges with the RICS and how are they dealing with this?
A
- ESG, sustainability, circular economy
- RICS released a manifesto for the built environment in Sep 2023
- public needs to have a safe sustainable energy efficient affordable built environment and home.
- emphasis on social value and regenerative land
20
Q
What is the Bichard Review
A
Lord Bichard carried out a review to
- recommend on governing structure
- leadership proposals
- future culture and strategy
21
Q
What were some of the key recommendations following the Bichard Review?
A
- renewed focus on public
- increase focus on diversity and inclusion
- greater leadership on sustainability and climate change
- increased focus on member engagement and focus on younger members
22
Q
Why were the Rules of Conduct updated?
A
easier for RICS members and firms to understand rules providing more confidence in public and clients.
23
Q
What would you need to do to register with the RICS?
A
- Disclose Business Type
- Nature of clients
- Complaints handling procedures + log
4 Responsible principle - PII
- Whether firm holds client money
24
Q
When was the RICS founded?
A
1868
25
What are the 4 levels of membership?
FRICS
MIRCS
ASSOC RICS
Traniee
26
Who is the RICS governed by?
Royal Charter
27
Who is the current CEO?
Justin Young
28
Who is the current predident?
Ann Gray
29
What is the role of the RICS?
promote and enforce highest professional standards within the property industry
30
What are the three types of conflict?
Own interest conflict
Party conflict
Confidential information conflict
31
What is an example of a party conflict?
single firm accepts two professional assignments relating to same transaction
32
How would you deal with a party conflict?
- I would be entirely transparent with all parties affected if they were happy to proceed
- I would gain informed consent from affected parties
- If informed consent is given I would put information barriers in place
- I would ensure a clear audit trail
- I would ensure securely stored information
33
What is an example of an own interest conflict?
relates to a personal interest - e.g valuing something for a family member
34
What is an example of a confidential information conflict?
confidential work between two parties
for example say Allsop declined an instruction due to a conflict of interest but they obtained information that would be of interest to a client - that information would be confidential
35
what are the 3 steps to take before accepting an instruction?
checked professionally competent
check conflicts
confirm terms of engagement and written approval
36
When would you decline an instruction?
not competent
client has not completed AML checks
there is a conflict of interest
37
What are the six main areas of good practice set out in RICS professional statement on Client money handling 2019 ?
1. Holding client money
2. Providing information to clients
3. Receipts of client money
4. Payments from client accounts
5. Accounting records and controls
6. Compliance
38
How do you handle clients money?
I handle clients money in line with RICS Client Money Handling 1st Ed 2019
- clients money must be in separately labeled client account
- the word client is on the account
- client can have monies on demand
- money can only be withdrawn if properly required
- accurate records are kept
39
How would you decide what level of PII cover you need if you were starting up a new practice?
base on estimate turnover and adjust in due course.
40
How do you avoid negligence when carrying our surveyor work?
- understand clients objectives
- terms of enragement
- ensure competence
- confirm PII insurance
- detailed file notes
41
What happens when you carry out AML checks?
run through a third party data base that will analyse information and flag anything that could be of a concern such as legal proceedings against someone, criminal activity.
42
What customer due diligence checks do you carry out?
- require certified copies of ID and proof of address within 3 months
- for a company - name, registered address, number
- ID and proof of address for anyone with 25% share more of company
43
What is enhanced due diligence?
additional procedures for business or transactions involving high risk countries or politically exposed person.
additional evidence and monitoring
more detailed examination of background and nature of transactions
44
What are some of the red flags that could indicate money laundering?
- inability or unwillingness to provide documents required for AML
- changes to parties involved in a transaction
- unusual transactions features - loads of small payments
- payment of fees in unusual currencies
45
What are some of the key provisions of money laundering?
- have systems and policies in place to address money laundering
- provide staff training
- comply with new customer and enhanced due diligence requirements
- AML checks to identify anyone involved in transaction
- ensure appropriate record keeping
46
What are the penalties for money laundering?
14 years and unlimited fine for assisting
5 years in prison and unlimited fine for tipping off
47
What is a bribe?
giving, offering, receiving or promising something of value in exchange for an act of service which you usually wouldn't do
48
what are the six principles of the bribery act
proportionality
top level commitment
risk assessment
due diligence
communication
monitoring and review
49
what are the four offences under the bribery act?
bribing
receiving a price
failing to prevent a bribe
bribing a foreign public official
50
How would you set up an RICS Practice?
1. Inform the RICS of my practice
2. Appoint a responsible principle
3. Register for regulation with RICS
4. Arrange PII and send details to RICS
5. Set up client money handling procedures
6. Appoint a complaints handling officer, procedures and log
7. Use RICS logo on material
8. Ensure CPD logged
9. Ensure completion of annual return
10. If carrying out red book valuations register for RICS valuer Registration scheme
51
What statutory compliance do you need for setting up a new RICS practice?
- disclose business name
- register with companies house
- comply with equality act
- comply with fire regulations
- comply with health and safety
- register for data protection
- inform HMRC
- bribery act compliant
52
How would you close an RICS practice?
- inform RICS of closure
- organise run off cover for 6 years - minimum £1m
- return any clients money you are holding
- organise for clients to be moved to a new firm
- retain files for 6 years
53
What are the three levels of disciplinary action?
Action by head of regulation
Action by Disciplinary Panel
Appeal Panel
54
What is the initial investigation stage of a disciplinary procedure?
- investigation by Head of Regulation
1. Fixed penalty notice
2. Regulatory Compliance order
3. Refer to a Tribunal
4. Refer to Disciplinary Panel
55
What are some examples of a Regulatory compliance orders?
1. written document which states that you must undertake certain actions in a specified time period
2. fine
56
What issues does a regulatory compliance issue cover?
Failure to log CPD
non compliance with Rules
57
What are examples of actions by disciplinary panel?
1. expulsion of membership
2. publication in modus, website and local newspaper
3. Fine
4. Reprimand
58
What is the RICS Decision Tree?
Framework of questions that members should ask when faced with an unethical situation
59
What are some of the questions included on RICS ethical decision tree?
do you have sufficient facts
have you got all the relevant information / consulted with people to inform your choice
is it in line with rules of conduct
is it legal
would you be okay if you actions were made public
60
How do you register with the RICS?
1. Confirm Business Type
2. Confirm responsible principle
3. Confirm nature of clients
4. Confirm whether you will be holding clients money
5. complaints handling procedure, log and officer
6. PII insurance
61
What would you do if you could not complete Customer Due Diligence?
1. If the client can not comply with the requested customer due diligence I would not carry on work with them and not form a business relationship
62
What is your firms process if you suspected money laundering?
Staff must raise an internal report by filling in unusual activity form
AML nominated officer but make a suspicious activity report to national crime agency if they believe there is reasonable grounds to suspect money laundering
I also understand it is a criminal offence to do or say anything that tips another person off who is suspected of money laundering
63
What is Phishing?
cyber attacks usually via email with bad links corrupt downloads
64
What are some red flags of phishing?
1. unexpected emails
2. information mismatch
3. urgent language
4. unprofessional design
65
Could you accept a gift worth £2,000?
No because this is in breach of my firms gift policy
66
Please can you tell me about your firms gift policy?
- giving or accepting gifts up to the value of £150 is allowed if they are not made with intention of influencing a third party, does not include cash equivalent, appropriate in circumstances
- all gifts must be registered of gift register
- gifts over the value of £150 should be reported to department head
- report any suspicion
67
What is your firms complaint handling procedure?
1. contact the firms complaint handling officer
2. send a written summary
3. within 7 days allsop will contact you to inform understanding and circumstances of complaint
4. within 21 days we will informs of outcome of investigation and actions taken
5. if complaint is unresolved the person can contact the property readdress scheme
68
What steps would you take if you were valuing a property and was concered it was contaminated?
I would consider declining the instruction depending on what the property was
If I felt I was competent to undertake the instruction I would ensure a specialist report was undertaken before providing advice.
69
What is the Proceeds of Crime Act 2022?
creates a set of criminal offences to combat money laundering
1. concealing criminal property
2. if a person enters into an arrangement which they suspect facilitates criminal property
3. if a person acquires or uses criminal property
70
What are the two main duties under the Royal Charter?
- act in the public interest
- to inform and educate
71
What are 5 benefits of being a RICS member?
SKRAN
Status - client confidence
Knowledge - professional standards / cpd
Recognition
Market Advantage
Network
72
What is conflict avoidance?
where you do not accept the instruction
73
what is conflict management?
instruction is accepted then managed
74
How long should you hold data for?
Under the GDPR, you can only hold personal data for as long as you need it.
75
Can you act for the buyer and the seller of a property?
dual agency must not be undertaken in any circumstances.
76
Can you provide incremental advice if you are acting as agent for a seller but approached by the buyer or lender to provide a valuation?
must only provide incremental advice if consent is given and an information barrier is put in place before.
77
How would you put an effective information barrier in place?
ensure it was robust so no information can pass
all information should be securely stored
keep a clear audit trail
physical separation
78
How long should old files be kept?
minimum of 6 years before disposal and destroyed securely.
79
What are the CPD requirements for a chartered surveyor?
20 hours CPD, at least 10 hours formal
80
What is formal CPD?
structured learning that has clear objectives
81
what is informal CPD?
self managed learning / private study
82
What are the current minimum requirements for PII based on firm turnover?
Turnover PI
£100k =£250k
£100 - £200k = £500k
£200k + = £1m
83
What is the maximum level of uninsured access?
Up to £10m - 2.5% or £10,000
Over £10m - no set limit
84
What run off cover is required?
minimum of £1m over 6 years
85
How would you deal with a transaction involving a Politically Exposed Person (PEP)?
- senior managers involved and decide whether to proceed with transaction
- enhanced diligence undertaken
- deeper understanding of transaction and source of funds
86
How would you deal with a bribe?
I would never accept anything that could constitute a bribe
I would report to my senior management
If I was a sole trader I would report directly to serious fraud office
87
as and RICS valuer, why couldn't you disclose the Market Value of a property to the agent who was selling the freehold?
In breach of RICS professional statement on conflicts of interest, which states that client confidentiality must be maintained
88
are professional statements mandatory?
Yes
89
What is duty of care?
in commercial auction team my duty of care was to get the best price possible and to achieve a sale
when I was a valuer my duty of care was to provide independent reasoned advice on market value
90
If you were approach to carry out a valuation of a property that an equity partner at Allsop owned what would you do?
I would decline the instruction as this could be seen to effect impartiality.
91
What is negligence?
breach of duty of care
92
Tell me about a case law on negligence
Yianni Vs Evans
Valuers were liable for negligence for failing to report a subsidence issue.
93
How would you carry out enhanced due dilligence?
The source of funds involved;
The background and purpose of the transactions
Official records, registration documents, etc.
94
What enhanced due diligence would you carry out for a PEP?
- were funds are coming from
- if company paying understand the company, who are the people in the company
