Ethics (Level 3) Flashcards
(159 cards)
1
Q
Background - When was the RICS founded?
A
1868
2
Q
Background - When was the Royal Charter of the RICS granted by the Pricy Council?
A
1881
3
Q
Background - How is the RICS governed?
A
RICS Regulations and Bye-Laws
4
Q
Membership - How many qualified members?
A
Over 130,000
5
Q
Membership - What are the 4 levels of membership?
A
Trainee
AssocRics
MRICS
FRICS
6
Q
Membership - How do you become a fellow?
A
Evidence of 4 fellowship chracteristics
5 years + of MRICS
Leadership role
raising profile of RICS
Profile of professsional achievment required to include in CPD record
7
Q
Membership - What are 5 benefits of being an RICS member?
A
Status
Recognition
Market Advantage
Knowledge
Network
8
Q
Membership - What are 3 benefts for RICS-regulated firms?
A
Confidence - for clients as regulated firms are monitored by RICS
Professionalism - firms must provide clear, impartial and expert advice
Security - must have recognised CHP, access to free independant redress and PII cover
9
Q
Governane - How is the RICS governed?
A
Self-regulated
Goverened under terms of Royal Charter, by various internal councilm boards and associations
10
Q
Governance - How many members are in the Governing Council?
A
25 members
Run the RICS
11
Q
Governance - Who reports to the Governing Council
A
Regulatory Board
Management Board
Various committee’s
12
Q
Governance - How many specialist groups cover property?
A
over 18
Each group has an elected board
13
Q
Governance - Who is the chair of the RICS?
A
Tina Paillet FRICS
14
Q
Governance - Who is the current chair of the Governing Council?
A
Tina Paillet FRICS
15
Q
Governance - Who is the current CEO of RICS?
A
Justin Young
16
Q
Governance - What is the UK structure of the RICS?
A
4 National Assosciations
10 Regional Boards
Local assosciations
National associations focus on country-wide issues and work closely with the RICS headquarters on policy and strategy.
Regional boards ensure RICS’ initiatives are tailored to local market needs and offer a more direct line of communication between members and the national organization.
Local associations engage directly with members at a community level, supporting day-to-day professional development and networking.
17
Q
Governance - What reviews of the RICS are you aware of?
A
Levitt Review (2021)
- Alison Levitt exposed lack of clarity, structure and purpose of RICS governance arrangements.
- Levitt called for independant review of ‘purpose, governance and strategy’ of RICS
RICS Governing Council approved this call and a review by Lord Michael Bichard was completed
Bichard Review (2022)
- review to clarify purpose of RICS, including responsabilities to act in public interest’
- make recomendations on governance structure
- provide proposals for incoming leadership and governing body on future culture and strategy of the Institution.
Bichard reported in June 2022, making 36 recommendations in 7 key areas(ALL ADOPTED):
- renewed focus in public interest (creation of public interest panel to advise Governing Council)
- Increased focus on Diversity and Inclusion
- greater leadership on matters such as sustainability
- Renewing focus on young members, more engagement from regional boards
- a simplified RICS governance structure
Recomended a quick, phased approach to adop clear responsabilities for governance by key individuals, recruiting a new management board, and holding elections for key RICS committees and groups
18
Q
Governance - What is the aim of the Bichard Review?
A
To create a member-led public intereste focussed RICS with 5 key themes of:
governance, strategy, people, culture, values and member service
19
Q
Governance - Talk me through the Bichard Review?
A
- consultation with members and external stakeholders
- review to clarify purpose of RICS, including responsabilities to act in public interest’
- make recomendations on governance structure
- provide proposals for incoming leadership and governing body on future culture and strategy of the Institution.
20
Q
Governance - What are the New Governing Council Elections?
A
Adopted after Bichard Review
The RICS Governing Council elections are a key process through which members of RICS elect representatives to serve on its Governing Council.
This council is the highest decision-making body within RICS, responsible for setting the overall strategy and direction of the institution.
The Governing Council works to ensure that RICS continues to serve the public interest, support its members, and uphold professional standards globally.
21
Q
Governance - How did the RICS respond to the issues highlighted on DEI and Sustainability after the Bichard Review?
A
RICS recruited DEI and Sustainability Panel chairs to lead these priority issues as part of new governance structure
22
Q
Governance - How did the RICS respond to the issues highlighted on member engagement after the Bichard Review?
A
RICS announced in April 2023 a package to support and drive member engagememt, experience and value
Free CPD events, working with Matrix and improved customer experiemce
23
Q
Role of RICS - What is the role of the RICS?
A
to promote and enforce high professional qualifications and standards in real estate
24
Q
Role of the RICS - What is the RICS’s 3 main roles?
A
- maintain high standards in education and training
- to protect consumers through strict regulations of professional standards
- to be a leading source of information and indepdent advise
25
Role of the RICS -What does the RICS Standards documents lay out?
- ethical, conduct and competence related standards for the profession to deliver confidence and transparency
26
Setting Up - What regulations guide the registration of firms with RICS?
Rules for the registration of firms (2022)
(Regulations)
27
Setting Up - What information is required in an annual return?
1. Type of business and staffing details
2. Name of Responsible Principal
3. Statuatory regulated activities - such as for financial services
4. Nature of clients
5. CHP and records
6. PII details
7. Whether firm holds client money
28
Setting Up - What information is required by RICS for Registration? (same as annual return)
1. Type of business and staffing details
2. Name of Responsible Principal
3. Statuatory regulated activities - such as for financial services
4. Nature of clients
5. CHP and log
6. PII details
7. Whether firm holds client money
29
Setting Up - What's the purpose of an annual return?
Ensure compliance with obligations
30
Setting Up - What are the requirements for firm registration to the RICS
- Firm's providing surveying services to the public must register if no RICS members, firm cannot register
- Regulation provides a 'gold standard' of quality control
- Firms must annually make a return to the RICS confirming compliance to obligations
- A practice can be a corporate body, a partnership, an LLP or a sole practioner
- **if 50% of the Firm’s Principals are RICS Members it has to be regulated**, if **25% are members than it can apply to be regulated**
- Each firm must nominate a Responsible Principal to ensure all reasonable steps are taken and systems in place to ensure compliance with regulatory and RICS requirements.
31
Setting Up - Who are principals?
sole practitioner
director
partners
Board members
or anyone with equivalent status as bove
Refer to Rules for the registration of firms (2022)
32
Setting Up - What does each firm have to do when registering?
Appoint a Responsible Principall
Refer to Rules for the registration of firms (2022)
33
Setting Up - Who is the Responsible Principal?
Ensure all steps are taken and systems are in place to ensure compliance with regulatory and RICS requirements
Refer to Rules for the registration of firms (2022)
34
Setting Up - What if there is a dispute when setting up a firm?
Heard by the RICS Standards and Regulations Board
full details found on RICS website
35
Setting Up - What is the registered firm designation?
- 'regulated by the RICS'
- RICS’ Rules of Conduct require that ‘Firms must display on their business literature, in accordance with RICS’ published policy on designations, a designation to denote that they are regulated by RICS’.
- Rules for the use of the RICS logo and designation by firms (2022) (Regulation)
36
Setting Up - Logo questions???
37
Rules of Conduct 2021 - When did the new Rules become effective?
February 2022 on a global basis
38
Rules of Conduct 2021 - What are the new Rules of Conduct?
Single set of rules apply to members and firms
39
Rules of Conduct 2021 - What are the 5 Rules of Conduct?
Apply to members and firms!
1 - Honesty and integrity
2 - Maintain professional competence - ensure necessary expertise
3 - Good quality and dilligent service
4 - Treat others with respect and encourage D&I
5 - Public interest
40
Rules of Conduct 2021 - What is in Appendix A?
Mandatory rules for members and firms
41
Rules of Conduct 2021 - What are the rules for members in Appendix A?
3 Rules for Members:
1. Complete CPD
2. Cooperate with RICS
3. Provide all information to the RICS Standards and Regulatiom Board
42
Rules of Conduct 2021 - What are the rules for firms in Appendix A?
1. Publish CHP (includes ADR approved by RICS) & maintain complaints log
2. Previous and current work has appropriate PII
3. Cooperate with RICS
4. Provide all information to the RICS Standards and Regulatiom Board
5. Designation to note they are regulated by RICS
6. Report to RICS on any rule relevant t othe Rules for Registration of Firms (2022)
7. If having a sole principal, make appropriate arrangements for professional work to continue in event of their incapacity, darth etc
43
Rules of Conduct 2021 - Why were the rules of conduct updates?
Public trust, global consistency. simplified
44
Rules of Conduct 2021 - Name a time when you have demonstrated Rule 1?
Rule 1 is Honesty and Integrity
e.g. explaining service charge budget costs
45
Rules of Conduct 2021 - Name a time when you have demonstrated Rule 2?
Maintain professional competence and ensure services are provided with necessary expertise
e.g. completing CPD
46
Rules of Conduct 2021 - Name a time when you have demonstrated Rule 3?
Rule 3 is provide good quality and dilligent services
e.g. high quality reports
47
Rules of Conduct 2021 - Name a time when you have demonstrated Rule 4?
Rule 4 is treating others with respect
e.g. attending REB (real estate balance)
48
Rules of Conduct 2021 - Name a time when you have demonstrated Rule 5?
Rule 5 is acting in the public interest
e.g. informed tenant to move bins from fire escape at Kingsgrove
49
Rules of Conduct 2021- What is the RICS Ethics Decision Tree?
Supporting information to the Rules of Conduct 2021
framework of questions which members should ask themselves when asked to act in a potentially unethical manner
Includes considering legality, Rules of Conduct, and consultation with appropriate people
Ultimate test is would members want decision to be made public
50
Rules of Conduct 2021 - If you have an ethical issue, what would you do?
Refer to Rules of Conduct 2021
Refer to RICS Ethics Decision Tree
Refer to RICS Hotline for ethical isssues
51
RICS Discipilinary Procedures - What are the three levels of disciplinary action by RICS?
1. Action by Head of Regulation
2. Disciplinary Panel
3. Appeal Panne
52
RICS Discipilinary Procedures - Why does the RICS have disciplinary procedures?
- protect public interest
- uphold public confidence
- uphold professional standards
53
RICS Discipilinary Procedures - Talk me the process of RICS investigation?
- formal investigation by Head of Regulation of RICS
- Head of Regulation can initiate one of following four actions if disciplinary action required:
1. Fixed Penalty Notice
2. Regulatory Compliance Order
3. Refer matter to single member of Regulatory Tribunal
4. Refer matter directly to Disciplinary Panel
54
RICS Discipilinary Procedures - What are Regulatory Compliance Orders?
- Low level breaches (e.g. not applying to be a RICS registered firm when necessary to do so,
- Written document stating what member/firm must do to avoid further actions
e.g. providing public services from non-regulated firm - Paul Shepheard recently charged)
55
RICS Discipilinary Procedures - why are disciplinary procedures carried out? Who are they undertaken by?
RICS responsible for regulating surveying professional to:
Protect public
Uphold public confidence
Uphold professional standards
Standards and Regulations Board
56
Social Media - What guidance are you aware of regarding social media?
Use of Social Media: Guidance for members (2021) - Regulation
57
Social Media - When might the RICS investigate concerns about social media posts?
- disciminiation
- dishonest
- abusive
- bullying
58
Social Media - When is the RICS unlikely to investigate social media posts?
- critical of organisation
- professional and respectful language
- removed if requested to do so
59
Social Media - What can the RICS do if it feels social media posted may damage public confidence in professionalism?
Disciplinary Action
60
Core Material - What are Professional Standards?
- mandatory
- set requirements or expectations for RICS members / regulated firms
- must be followed
- RICS in process of re-catergorising all Professional Statements to become Professional Standards
61
Core Material - What is RICS Practice Information?
- information to support the practice, knowledge and performance of RICS members/regulated firms
- not mandatory and not explicit recomendations
- RICS in process of re-catergorising all current Guidance Notes to become Practice Information
62
Fee Negotiations - How should fees be set?
- avoid price fixing
- avoid aggressive fee cutting (but healthy competition encourgaed)
- avoid collusion with competitors
- Fees shoukd be market-based and agreed on ad-hoc basis with clients
- may negotiate fee proposal with client, as long as professional
- no undercutting firms
- transparent if receiving a referrral fee in Terms of Engagement!
- granting and accepting referral fees should be considered in context of Bribery Act 2010 and RICS rules of Conduct
63
Fee Negotiations - Are referral fees allowed?
- yes but must be transparent in Terms of Engagement
- always consider in light of Bribery Act 2010 and Rules of COnduct 2021
64
Terms of Engagement - What are Terms of Engagement?
- state in writing the client's agreements to the proposes fee basis, payment of expenses, and that a copy of the CHP is available on request.
65
Terms of Engagement - What steps do you follow when agreeing Terms of Engagement?
THREE STEPS
1. Check competence
2. Conflict of Interest Check
3. Confirm Terms of Engagement in writing and get written approval from the client before you start work on instruction
66
Terms of Engagement - What compliance is required for estate agency work regarding Terms of Engagement?
- Complian with Section 18 of Estate Agents Act 1979
Money Regulations, 2017, AML checks required for agency work
Consumer Rights Act 2015 allows cooling off period of 14 days
67
Terms of Engagement - When is it appropriate to decline work?
1. Not competentn
2. Client will not sign ToE or complete AML checks
3. Conflict of interest or personal interest
4. PII liability cap cannot be agreed
5. PII will not cover work carried out on personal basis e.g. advice is for a friend
6. Client is in UK government sanction list
- consider RICS ethics tree
68
Conflict of Interest - What guidance relates to conflicts?
Conflict of Interest, 2017 - Professional Standard
69
Conflict of Interest - What is Conflict of Interest, 2017 and what does it state?
Professional Standard
Mandatory
States members/firms must not represent a client where doing so would impair their impartiality , other than where all those who may be affected have provided their informed consent.
Informed consent only sought when RICS member or firm is satisfied proceeding is in the interest of all those involved and not prohibited by law
70
Conflict of Interest - What is a conflict of interest?
When a member or firms impartiality is impaired due to a conflict between two clients:
- financial interest
- personal interest
- commercial relationship
- actimg on both sides of transaction
71
Conflict of Interest - What is the difference between conflict avoidance and conflict management?
- avoidance - do not accept instruction
- management - instruction accepted and steps implemented to manage the conflict
72
Conflict of Interest - What are the types of Conflict of Interest?
Party Conflict - relating to work on the same instruction for two different parties
Own Interest Conflict - relating to personal interest
Confidential Information Conflict - relating to work between two parties that is confidential (must receive client permission, unless subject to statuatory overiding rights such as HMRC or police)
73
Conflict of Interest - What is informed consent?
- only provided in writing
- party must understand all material factors at play
- must be totally transaprent
- Surveyors must only seek informed consent if satisfied it is in best interest of all parties involved and not porhibited by law
74
Conflict of Interest - How would you handle a conflict of interest?
Step 1 - conflict avoidance - consider if conflict is irresolvable because your impartiality is compromised, or whether it can be properly managed maintaining transparency and openness. (Decide whether to accept or decline instruction).
Step 2 - Written advice to both parties - assuming you want to accept instruction, set out in writing:
1) disclose nature of conflict and state how your firm tends to deal with the conflict, such as setting up an information/ethical barrier
2) be clear - inform to seek indepdendant advice if necessary
3) request written confirmation from both clients of their informed consent and that your firm can act in accordance with procedures proposed
Step 3: conflict management - once written confirmation received, set up an informaiton barrier in accordance with the provisions agreed with both clients.
75
Conflict of Interest - Talk me through how you might manage a conflict?
Conflit Management - Information / Ethical Barriers
- if both clients agree, your firm can act for two parties where a conflict of interest exists, having completed the above procedure, by creating an informaiton barrier between those acting for the retrspective clients
- the barrier must be robust to ensure no chance of informaiton passing between two parties
- must take reasonable steps to operate an effective barrier
- the surveyors acting on the two sides must be different and they must be physically seperated, and with seperate support teams
- all information regarding the instruction should be securely stored
- keep a clear audit trail of the conflict check progress and all written and oral communication the firms compliance officer must oversee al actions
76
Conflict of Interest - Talk me through a time you have seen a conflict of interest managed within your firm?
?
77
Conflict of Interest, UK investment Agency 2017 - What is it?
- mandatory, professional standard
- relevant to investment agency work
dual agency MUST not happen
multiple introductions
incremental advice
78
Conflict of Interest, UK investment Agency 2017 - What does it say regarding dual agency?
- must not undertak dual agency under any circumstances
- dual agency where agent acts on behalf of buyer and seller
79
Conflict of Interest, UK investment Agency 2017 - What does it say regarding multiple introductions?
- competing contractual relationships with several buyers for commercial investments
- must make clear in Terms of Engagement whether agent is working exclusive or non-exclusive basis
- the agent must obtain informed consent from the client, subject to information barriers being put in place
80
Conflict of Interest, UK investment Agency 2017 - What does it say regarding incremental advice?
- e.g. if agent is acting for seller in relation to disposal but is approached by the buyer to provide a valuation
- RICS members must only provide incremental advice if consent is given and an information barrier is put in place before providing incremental advice to theprospective buyer
81
Conflict of Interest, UK investment Agency 2017 - What is a personal/own interest conflict?
- when acting for family member, or other connected person
- full transparency required
- declare facts promptly and in writing
- remember section 21 of Estate Agent Act 1979 declaration required for ageny work
82
Confidentiality - What would you do if a 3rd party wanted to access your files?
- client consent first unless statuatory duty such as HMRC investigation or police
83
Confidentiality - How long should you keep files before dosposing?
- 6 years
- destroyed securely
84
Confidentiality - What would you do if you overhead information that is confidential?
- not used for own purpose
- advise client and sender of error
- record matter in a note to firms compliance officer
- dispose securely of error
85
CHP - What is the guidance on CHP?
Complaints Handlng, 2016 - Guidance Note
86
CHP - How is a firms CHP approved?
approved by RICS
87
CHP - What is the first step when receiving a complaint?
- notify PII insurers of claim as this could lead to a claim for negligence
88
CHP - where do you provide your CHP to client
- at the same time as Terms of Business
89
CHP - What is a complaints log?
Maintained by comliance officer, contain details of complaint, progress and outcome
90
CHP - What else must firms include in their CHP?
RICS Approved ADR mechanism
91
CHP - What would you do if a complaint has uncovered a serious breach by the firm or a member of staff (e.g. missing client money)
report this to RICS regulation in accordance with the Rules for the registration of firms and Bye-Laws.
92
CHP - What is the minimum proedures for handling a complaint?
Stage 1 (in-house)
- CHP issued when firm receives complaint to a valid complainant to whom the firm owes a duty of care
- must be quick, clear, transparent, and impartially implemented
- details of nominated person who will investigate the complaint (complaints handling officer) must be stated
- the complaint must be made in writing
- strict timescales for complaints recorded
- acklowdge complaint in 7 days and investigated in 28 days
Stage 2 (ADR)
- if complainant is not happy, the second stage uses an independant redress scheme that the firm has chosen to use
- the name of the appropriate redress mechanism must be provided to complainant
e.g. Centre for Effective Dispute Resolution (consumers)
e.g. RICS Dispute Resolution Service (business clients)
93
CHP - If you were a sole practioner, who would be your CHO?
- appoint a surveyor in another firm to act as complaints handling officer
94
CPD - What are the requirements for members?
1) 20 hours CPD per year
2) 10 hours must be formal CPD, remainder informal
3) all members must maintain a relevant and current understanding of RICS Rules of Conduct during rolling 3 year period
4) must record CPD activity using RICS CPD management system available on RICS website by 31 January each year
95
CPD - what is formal CPD?
structured learning with clear learning objectives and outcomes
e.g. seminars, professional courses
96
CPD - what is informal CPD?
self managed learning that is relevant to your role
private study, events, informal seminars
97
CPD - how do you decide if CPD is formal or informal?
RICS webste
RICS Decision tree if formal or informal
98
PII - What is Professional Indemnity Insurance?
- to protect clients, surveyors, 3rd parties against negligence claims when duty of care breached and claim arises
99
PII - what guidance on PII is there?
Professional Indemnity Insurance Requirement (2024) - Regulations
100
PII - When do you need PII cover?
- undertaking any instruction
101
PII - Do policies for PII have to be underwritten?
- yes by RICS approved insurer
102
PII - what minimum requirements for PII?
based on turnover of proceeding year
Firms Turnover minimum level of indemnity required for each and every claim
£100k or less £250k
£100k - £200k £500k
£200k or more £1m
these are minimum! always consider likely risk profile to negligence claims when deciding on level of insurance needed
103
PII - What if you are a new business, how do you estimate PII?
estimate turnover
adjust in due course accordingly
104
PII - What is the maximum level of uninsured excess required by RICS?
based on turnover of proceeding year
Firms Turnover maximum uninsured exceed
Up to £10m greater of 2.5% of sum insured or £10,000
Over £10m no set limit
For example, if a PII policy has a coverage of £1,000,000, the maximum uninsured excess would be £25,000.
105
PII - What should a PII policy be?
Fully retro-active
PII policies work on a 'claims made basis' i.e policies cover claims that are made during the period of insurance.
106
PII - Where does you PII certificate get sent for RICS-regulated firm?
- certificate sent to RICS on annual basis as part of the firm's annual return to RICS
107
PII - What do you do when a potential claim arises?
- notify insurers without delay
108
Run Off Cover - What level of run-off cover is required?
- for consumer claims, a minimum of £1,000,000 of aggregate cover over a 6 year period
- for commercial claims, first must consider what is adequate and appropriate for minimum of 6 years
6 years because of Limitation Act 1980
109
Run Off Cover - What can firms do if they are unable to obtain run-off cover?
RICS Run Off Pool?
110
What would you do if your laptop was stolen?
- Inform IT team
- remotely lock or wipe laptop
- Notify POLICE
- Advise to lock and encrypt remotely
- change passwords
- document on incident report
- If serious threat of data breach, inform the ICO within 72 hours
111
What is your company gift policy?
- Declare all gifts to compliance officer regardless of value
- policy is that all gifts of under £100 are shared in office
- if gift is over £100, politely reject gift
- record all gifts in gift register
112
Current major challenges facing RICS?
Sustainability - sustainability standards
Diversity Inclusion - Free CPD, MATRIC release in April 2023
Governance - ?
113
Rules for the Registration of Firms 2022 requirements?
50% principals are RICS members has to be regulated
25% principals are RICS members can opt to be regulated
Each firm must appoint a Responsible Principal in charge of compliance with RICS requirements
114
When have you demonstrated honesty and integrity (Rule 1)
115
When have you maintained professional competence? (Rule 2)
CPD requirements
refer specialists for work
116
When have you provided good quality and dilligent services? (Rule 3)
Identifying the breach during my case study
Provided reports in-line with AMA requirmeents
117
When have you treated others with respect and encouraged diversity? (Rule 4)
member of DEI comitty
incorporated our annual DEI survey
understand how we can help those with ADHD
118
When have you acted in the public interest? (Rule 5)
informed tenant to clear a fire escape blocked by bins
119
What happens if there is a dispute regarding RICS registration?
heads by the RICS Standards and Regulation Board
120
What is the RICS Ethics Tree?
found on RICS website
framework of questions to ask yourself
used in unethical situations
consider legality of decision
test = would you want decision public
Also RICS Hotline to assist members
outcomes: do not proceed, proceed and record decision reasoning
121
Tell me what you know about conflict of interest?
A situation where a professional’s ability to act impartially is compromised by personal, financial, or competing interests.
122
In a situation where a client wants to use your services, and one of your sister company's services as well, how would you manage?
exclusivity of staff
seperate communication lines into client
sign a NDA agreement
monitor agreement
123
If a client was insistent to continue regardless of a conflict, how would you act?
- ensure client is fully aware of the conflict itself
- talk through ways of managing the process (information / ethical barriers)
- written consent (informed consent)
124
When is a conflict of interest not manageable?
when it cannot be resolved in a way that ensures complete impartiality, transparency, and fairness
e.g. significant financial stake, close personal relationships, no client consent, acting for both buyer and seller
125
Upon receiving a complaint, what should you do?
inform insurers (PII) straight away
126
What are minimum levels of indemnity?
RICS has standard form "Professional Indemnity Insurance Requirements" (2024) - Regulation
turnover preceeding year
0-100k - £250K min for each and every claim
100-200k - £500K min for each and every claim
200k+ - £1m min for each and every claim
127
What are the maximum levels of uninsured excess?
RICS has standard form "Professional Indemnity Insurance Requirements" (2024) - Regulation
turnover preceeding year
Up to £10m - greater of 2.5% of sum uninsured or £10,000
Over £10m - No set limit
128
Levels of Disciplinary Procedures?
Action by Head of Regulation
Disciplinary Panel
Appeal Pannel
129
What is the stages of discipinary investigation?
- investigation by head of regulation
- initaite one of following:
1. fixed penality notice
2. regulatory compliance order
3. Refer the matter directly to Disciplinary Panel
130
When are fixed penalties issued for disciplinary action?
relating to supply of information to RICS by members/firms
131
When are regulatory compliance orders issued for disciplinary action?
low level breaches, easily corrected
written document setting out actions members must follow
can be fine
132
When are is action made by the disciplinary panel issued for disciplinary action?
serious breaches of conduct
panel includes lay members
Head of regulation can consider a hearing is required
penalties can be:
Regulatory compliance order
reprimand
fine
expulsion
public of results on Modus magazine, RICS website, and local newspaper
133
When is the appeal pannel involved?
consider members appeal
can vary penality imposed
panel includes lay members
134
Whats included in an information barrier?
- physical seperation
- different teams
- IT seperation
- NDAs
- regular monitoring
- overseen by compliance officer
135
What is the Limitation Act 1980?
limitation periods for negligence claims
contract - 6 years from date of negligence (or 3 years from the date of knowledge to 15 year long stop)
tort - 6 years from date claimant suffered loss
136
Procedures under Professional Standard 'Handling Clients Money' (2016)?
- client accounts held seperately
- word client on bank account
- client must be able to access money on demand
- payment of interest agreed with client
- account must be kept in credit
- regular bank reconciliations
- running balance kept
- annual audit reporting obligation by RICS accountant
- signatories agreed with authorised staff
- expenditure reviewed monthly
RICS Regulatory Review's can be undertaken on routine 3-yearly basis
Must display procedures on website
137
What is the RICS Client Money Protection Scheme?
Protection from claims from clients where RICS regulated firm is unable to repay client mandaotory for RICS firms
138
When starting a new practice, what compliance matters should you carry out? (RICS Compliance)
Consider first statuatory or RICS compliance?
- Inform RICS and complete Firm Details Form
- Appoint Responsible Principle for all RICS communication
- Register with RICS for regulation of firm
- Arrange PII and send details to RICS
- Client Money Handling and Client Money Protection Scheme
- CHP approved by RICS
- Complaints Log
- Complaints Handling Officer
- Use RICS logo kit for all practice material
-'Regulated by RICS'
- Ensure CPD logged and staff training
- Ensure completion of Annual Return each year
139
When starting a new practice, what compliance matters should you carry out? (Statuatory Compliance)
- Business Name
- Equality Act 2010
- Bribery Act 2010
- Compliance with GDPR 2021 and Data Protection Act 2018
- Money LAundering Regulations 2017 - appoint AML officer
- Health and Safety at Work Act 1974
- Asbestos Regulations 2012 - asbestos register
- Fire Safety Order 2005
- Inform HMRC for VAT and Tax (£85K tunrover threshold for VAT)
- Employment Law
140
What would you do when closing a practice?
- inform RICS
- ensure clients are informed
- handover arrangements
- return clients moneys
- inform isnurers
- procure run-off cover for 6 years from expiry of policy
-retain copy of client files for 6 years
141
6 principles of Bribery Act 2010?
Proportionality
Top level commitment
Risk assessment
Due dilligence
Communication
Monitoring and review
142
4 offences of Bribery Act 2010?
- bribing
- recieving a bribe
- bribing a foreign public office
- failing to prevent a bribe
143
Penalties of Bribery Act 2010?
Policed by Serious Fraud Office
10 years prison or unlimited fine
144
Key provisions of Money Laundering Terrorist Financing and Transfer of Funds Regulations (2017)?
- written money laundering risk assessment
- systems, policies, training
- internal controls
- staff training
- CDD
- EDD
- PEPS
- record keeping
- AML checks (identity and source of funds)
- £10K limit of cash acceptance
- Money Laundering Officer appointed to report suspicious actity report (SAR) to National Crime Agency
- senior member of staff to take compliance
- retain records for 5 years and reort to Companies House discrepencies between client information
145
Estate agent obligations under money laundering regulations?
- CDD checks
- EDD checks if red flag (high risk countries, non-face-to-face relationship)
- register with HMRC if letting properties more than 10,000 euros / month
146
Whats included in CDD checks for AML?
- identify client
- varify identity (passport - use 3rd party to verify, check watermark, date of birth etc)
- identify beneficial owners of client (companies house)
- name of directors
- source of funds
- intended nature of business relationship
147
Whats included in EDD checks for AML?
when red flag, or high risk country, or PEP
more detailed background and purpose of transaction
- source of funds
- multiple ID checks
- UK Sactions list
- background research
- questionairres / interviews
148
Penaltiies under Money Laundering Regs 2017?
- max 14 years / unlimited fine for assisting
- max 5 years / unlimited fine for tipping off person they are under suspicioin / failing to report
149
CDD requirements depending on organisation type
PLC
- Stock exchange
Public accountable body
- government ownership
Private Limited Company
- full name, company number, registered office, busines adress, directors
Individual
- passport, id, bank statement, credit card, council tax statement (evidence of adress, max 3 months old)
150
What main things would you consider if asked about cash, gifts, hospitality?
- Bribery Act 2010
- Countering Bribery, Corruption, Money Laundering and Terrorist Financing (2019)
- Professional statement
- Firms policy
- professional objectivity
- proportionality
- timing
- sanctions
- employment contract
151
What main things would you consider if asked about AML?
- Money Laundering Regulations
- Countering Bribery, Corruption, Money Laundering and Terrorist Financing (2019) - Professional statement
- DD procedures
- Professional objectivity, opennes, transparency
- red flags
- sanctions list
152
What are some money laundering Red Flags?
- not providing documents
- urgency
- changes to parties involved
- unusual requests
- unual currencies
153
What to do if a client is a match on the sanctions list\?
- contact Office of Financial Sanctions Implementation (OFSI) for assistance
- check hig risk clients against HM Treasuries consilidated list
- subscribe to HM treasuries Sanctions Notice
154
What is the Proceeds of Crime Act 2002
- provides powers to authorities in UK to recover criminal proceeds of crime
155
Main parts of Bribery, Corruption, ML and TF (2019) Professional Statement?
1 - Bribery and Corruption
2 - Money Laundering and Terrorist Financing
3 - Guidance
4 - Supplemtary Guide
156
Main concepts under Bribery and Corruption of RICS Professional Statement (2019)?
- not to offer or accept a bribe
- procedures in place to comply with law
- report suspicious activity (SAR) to National Crime Agency
- risk assessments
- due dilligence
- retain records
157
Main concepts under Money Laundering and Terrorist Financing of RICS Professional Statement (2019)?
- not facilitate or be compliant
- SAR report to National Crime Agency
- risk assessments
- due dilligence
- 3rd party reliance for checks
- understand purpose of isntruction
- ID checks
- retain records
158
Main concepts under Guidance of RICS Professional Statement (2019)?
- written procedures in place
- staff training
- transparency
- gifts register
159
Main concepts under Supplementary Guidance of RICS Professional Statement (2019)?
- 3 W's
who, what, why
- dealing with PEPs
- identifying beneficial owners (incorpoation of accounts or annual return)
