Ethics, Rules Of Conduct And Professionalism Flashcards
(125 cards)
1
Q
What is the RICS motto and what does it mean?
A
“Est Modus In Rebus”
There is measure in all things
2
Q
What is the mission statement of the RICS?
A
The mission statement of RICS is:
“To promote and enforce the highest international standards in the valuation, management, development of land, real estate, construction, and infrastructure.”
It emphasizes RICS’s commitment to upholding professionalism, integrity, and global standards in the built and natural environments.
- To equip their members to offer the highest standard of professional service
- To promote and enforce standards
- To lead solutions to major challenges faced by the industry
3
Q
When was the RICS founded?
A
1868
United Kingdom
4
Q
How is the RICS structured?
A
- Royal Charter – Grants RICS authority and special status.
- Governing Council – Sets the strategic direction of RICS.
- RICS President & Senior Vice President – Lead the institution and represent it globally.
- Board of Trustees – Ensures financial oversight and compliance.
- Committees & Panels – Focus on specific areas like regulation, standards, and ethics.
5
Q
What are the RICS 5 principles of better regulation?
A
- Proportionality – Actions should be proportionate to the risks or issues involved.
- Accountability – Regulators should be accountable for their actions.
- Consistency – Consistent approaches should be applied across similar cases.
- Transparency – Regulatory decisions should be clear and open.
- Targeting – Resources should be focused on high-risk or priority areas
6
Q
What are ethics?
A
Ethics refers to the set of moral principles or values that guide the behavior of individuals or groups. In a professional context, ethics dictate how individuals should act with integrity, fairness, and respect toward others, ensuring trust and accountability within the profession.
7
Q
What is Rule 1 of the New rules of conduct?
A
Members and firms are to be honest and act with integrity and comply with their professional obligations, including obligations to the RICS
8
Q
What is Rule 2 of the New rules of conduct?
A
Members and firms are to maintain their professional competence and ensure that services are provided by competent individuals who have the knowledge and experience
9
Q
What is Rule 3 of the New rules of conduct?
A
Members and firms must provide a good quality and diligent service
10
Q
What is Rule 4 of the New rules of conduct?
A
Members and firms must treat others with respect and encourage diversity and inclusion
11
Q
What is Rule 5 of the New rules of conduct?
A
Members and firms must act in the public interest and take responsibility for their actions. They must act to prevent harm, and maintain public confidence in the profession
12
Q
When did the rules of conduct change?
A
2nd February 2022
13
Q
Why did the rules change?
A
They had been in place since 2007. Members voted to create one single document, now with a greater focus on evolving technology and tackling climate change
14
Q
What are the professional obligations of members?
A
RICS members have the following professional obligations:
- Maintain High Standards – Uphold integrity, fairness, and professionalism in all work.
- Competence – Ensure they have the necessary skills and knowledge to perform their duties.
- Compliance with Regulations – Adhere to RICS rules, ethical standards, and legal requirements.
- Client Care – Act in the best interests of clients while maintaining objectivity and independence.
- Continuous Professional Development (CPD) – Commit to ongoing learning and development to stay up-to-date with industry changes.
15
Q
What are the professional obligations of firms?
A
- Must publish a complaints handling procedure, which includes an alternative dispute resolution provider approved by RICS and maintain a complaints log
- All previous and current professional work is covered by professional indemnity policy
- Firms with a sole principle must make arrangements for their professional work to continue in the event of their incapacity, absence from or inability to work
- Must cooperate with RICS
- Must report any matter as required by the rules for the registration of firms
16
Q
What are the steps of the ethics decision tree?
A
The RICS Ethics Decision Tree guides members in making ethical decisions by following these steps:
- Identify the Issue – Recognize the ethical dilemma or conflict.
- Consider the Rules – Refer to RICS’ ethical guidelines, rules, and relevant legislation.
- Evaluate the Options – Assess possible actions and their ethical implications.
- Consult with Others – Seek advice from colleagues, supervisors, or legal advisors if needed.
- Make the Decision – Choose the most ethical course of action based on the evaluation.
- Act and Reflect – Implement the decision and reflect on its outcomes for future guidance.
17
Q
Why does the RICS have rules of conduct?
A
RICS has Rules of Conduct to:
- Ensure Professionalism – Maintain high standards of integrity and ethics among members.
- Protect the Public and Clients – Safeguard the interests of clients, stakeholders, and the public by ensuring services are delivered with competence and fairness.
- Promote Accountability – Hold members and firms accountable for their actions and decisions.
- Maintain Trust and Confidence – Uphold the reputation of the profession by promoting transparency and ethical behavior.
- Provide Consistency – Standardize behavior and decision-making across the global RICS membership.
18
Q
In the case of a breach of a rule of conduct, what is the procedure?
A
If there is a breach of the RICS Rules of Conduct, the procedure typically involves:
- Investigation – RICS will conduct an investigation to assess the breach.
- Informal Resolution – If possible, the issue may be resolved informally through discussion or mediation.
- Formal Hearing – If the matter is serious, a formal disciplinary process may occur.
- Sanctions – Potential sanctions for a breach include warnings, fines, suspension, or expulsion from RICS.
- Appeals – Members can appeal decisions through RICS’ appeals process.
19
Q
How can a disciplinary proceeding be triggered?
A
A disciplinary proceeding can be triggered in the following ways:
- Complaint – A formal complaint is made by a client, colleague, or third party regarding a member’s behavior or conduct.
- Self-Report – A member self-reports a breach of conduct or ethical standards.
- Routine Monitoring – RICS may identify potential breaches through routine checks or audits.
- Referral by Regulatory Authorities – External regulatory bodies or authorities may refer a case to RICS if they believe a member has violated regulations.
20
Q
What are the 3 actions that can be imposed after the investigation stage?
A
- Fixed penalty
- Consent order
- Disciplinary panel
22
Q
What are fixed penalties?
A
- A Fixed Penalty is a set fine or penalty imposed for less serious breaches of RICS rules.
- It is used to resolve issues efficiently without requiring further formal proceedings.
- This is typically used for minor infractions.
23
Q
What are consent orders?
A
- A Consent Order is an agreement between RICS and the member to resolve the case without a formal hearing.
- The member agrees to specific terms (such as a warning or corrective action), acknowledging the breach and agreeing to take appropriate steps.
24
Q
When is a disciplinary panel applicable?
A
- A Disciplinary Panel is a formal hearing held when a serious breach of RICS rules is suspected or when other resolution methods (like fixed penalty or consent order) are not appropriate.
- The panel decides on the appropriate sanctions, which may include suspension or expulsion from RICS.
25
Q
What breaches would expulsion be suitable for?
A
Expulsion from RICS may be considered for serious breaches such as:
- Fraud or dishonesty – Deliberately misleading clients, misrepresenting facts, or financial misconduct.
- Severe professional misconduct – Repeated or gross violations of ethical standards, rules, or laws.
- Criminal Convictions – Convictions for serious crimes, especially those that undermine the reputation of the profession.
- Conflict of Interest – Failure to disclose or act upon significant conflicts of interest in professional dealings.
- Failure to maintain competence – Persistent failure to meet professional standards or qualifications, endangering client interests.
26
What procedures should you follow if you are starting up a new practice?
- Contact the RICS and register for regulation
- Appoint a contact office for all RICS communication
- Prepare a complaints handling procedure
- Obtain professional indemnity insurance
- Use "regulated by RICS" on all material
27
Can you advertise your new company in the press?
Yes, in a responsible manner
28
What insurances would you need to set up your own firm?
1. Professional Indemnity Insurance (PII) – Protects against claims for errors, omissions, or negligence in the services provided. It’s a mandatory requirement for RICS firms.
2. Employers’ Liability Insurance – Covers legal costs and compensation for employees who are injured or fall ill while working.
3. Public Liability Insurance – Covers claims for injury or damage caused to the public or property while conducting business.
4. Buildings and Contents Insurance – Protects the office premises, including the structure and equipment, from damage, fire, or theft.
5. Cyber Insurance – Protects against risks associated with data breaches, cyberattacks, or loss of sensitive client information.
29
What information do registered firms have to send to the RICS annually?
1. Confirmation of Compliance – Confirmation that the firm continues to meet the RICS Rules of Conduct and professional standards.
- Complaints handling procedure
2. Professional Indemnity Insurance (PII) Details – Proof of Professional Indemnity Insurance coverage, including policy details.
3. Financial Statements – Evidence of the firm’s financial status, including annual accounts or reports.
4. Staff and Qualifications Information – Information about the firm's staff and their professional qualifications or membership status with RICS.
5. Regulatory Changes – Any updates or changes to the firm’s structure, ownership, or operations that may affect compliance.
30
What processes are required when handling clients money?
When handling client money, RICS members and firms must follow these processes:
1. Segregation of Funds – Client money must be held in a separate client account, not mixed with the firm’s own funds.
2. Written Agreements – A clear written agreement must outline the terms of handling client money, including how and when it will be used.
3. Accurate Records – Maintain accurate records of all transactions involving client money, including receipts, payments, and balances.
4. Regular Reconciliation – Regularly reconcile client accounts to ensure all funds are accounted for and there are no discrepancies.
5. Client Consent – Obtain the client’s consent before any money is withdrawn or used for purposes other than what was agreed.
6. Compliance with Regulations – Adhere to the relevant regulations and RICS guidance for managing client money and avoid misuse or fraud.
7. Return of Funds – Ensure any unused or excess funds are promptly returned to the client.
31
What are the different types of clients money accounts?
1. Client Bank Accounts – A designated account used exclusively to hold client money. These accounts are separate from the firm’s own funds to prevent mixing.
2. Client Accounts with Interest – A client account where the balance earns interest, typically passed on to the client (unless otherwise agreed).
3. Imprest Accounts – Used for specific, short-term purposes where funds are pre-arranged and replenished as needed, often used in property management.
4. Stakeholder Accounts – A type of account used to hold funds on behalf of multiple parties, often used in transactions like deposits or escrows.
5. Escrow Accounts – Typically used in property transactions, where funds are held until all conditions of a contract are met.
32
What is meant by the term negligence?
Negligence refers to the failure to take reasonable care or precautions to prevent harm or damage, resulting in an injury, loss, or damage to others. In a professional context, it occurs when a person fails to meet the standard of care expected in their profession, causing a client or third party to suffer a loss.
33
What is the significance of the MERRETT V BABB (2001) case?
- The Merrett v Babb (2001) case is a landmark decision where the Court of Appeal ruled that a surveyor could be personally liable for professional negligence, even when acting on behalf of an employer that had become insolvent and lacked professional indemnity insurance.
- This case highlighted the potential personal liability of professionals for their actions, regardless of their employer’s financial situation or insurance coverage.
- The case established a precedent for holding professionals accountable in specific circumstances where they fail to meet the required standard of care.
34
What limitation periods are associated with underhand and deed forms of contract?
- Underhand Contracts (Simple Contracts) - The limitation period for claims arising from underhand (simple) contracts is typically 6 years from the date of the breach of contract (under the Limitation Act 1980).
- Deed Contracts - The limitation period for claims arising from contracts executed as deeds is 12 years from the date of the breach.
- A deed provides a longer period for claims because it is a more formal, written agreement and carries greater weight under law compared to a simple contract.
35
What must a complaints handling procedure include?
1. Clear and Accessible Process – Written procedure that is easily accessible to clients and members, outlining how to raise complaints.
2. Acknowledgment of Complaint – A prompt acknowledgment (usually within 5 working days) to the complainant, confirming receipt of the complaint.
3. Fair and Impartial Investigation – A thorough, fair, and impartial investigation into the complaint, ensuring all relevant facts are considered.
4. Timely Resolution – A clear timeframe for investigating and resolving complaints (typically within 8 weeks).
5. Communication of Outcome – Clear communication of the outcome of the investigation and any decisions made.
6. Appeals Process – A mechanism for escalating complaints if the complainant is dissatisfied with the outcome, including the option to go to the RICS Regulatory Tribunal if necessary.
7. Record Keeping – Detailed records of the complaint, investigation process, and resolution, which must be kept for a certain period (usually at least 6 years).
8. Training and Awareness – Ensuring all staff are trained to handle complaints in line with RICS standards and have access to relevant procedures.
36
What is an independent redress scheme
- An independent redress scheme in RICS is a third-party service that provides an impartial and unbiased process for resolving disputes between RICS members or firms and their clients.
- It ensures that clients have access to a fair method of resolving complaints if they are not satisfied with the outcome of a firm’s internal complaints handling process.
- RICS requires its members and firms to belong to an approved independent redress scheme to offer clients an additional layer of protection and accountability.
37
What is the Clients Money Protection Scheme (CMP)?
- The Client Money Protection Scheme (CMP) in RICS is designed to protect clients' funds held by RICS-regulated firms.
- If a firm misuses or misappropriates client money, the scheme provides compensation to the affected clients.
- RICS requires members who handle client money to be part of an approved CMP to ensure that clients are safeguarded in case of financial misconduct or errors by the firm
38
What is the purpose of joint names on a client account?
- The purpose of joint names on a client account is to ensure that client funds are protected and can only be accessed or managed with the agreement of both parties (typically the firm and the client).
- It provides additional security and accountability, ensuring that no single party can misuse or misappropriate the funds without the other’s consent.
- This is commonly used in situations where both the firm and the client have a shared interest or responsibility over the funds held in the account.
39
What are the CPD requirements?
- Complete 20 hours of CPD annually
- Record CPD by 31 Jan each year
- Include at least 10 hours of formal CPD
- Maintain professional and ethical standards
40
How many CPD hours must you do?
- Minimum of 20 hours, 10 hours must be formal
- Members must undertake learning on the standards expected around RICS ethics on a rolling 3 year period
- All CPD must be recorded via the RICS on line management system
- Failure to comply may result in disciplinary action
41
What activities are included within CPD?
- Formal Learning - Attending courses, workshops, seminars, or conferences, e-learning.
- Informal Learning - Self-study or reading professional journals, books, or articles, On-the-job training, peer discussions
42
What does PII stand for?
Professional Indemnity Insurance
43
What is the purpose of PII?
- Designed to protect professionals against claims of negligence or mistakes made during their work.
The primary purposes:
- Financial Protection – Covers legal costs and any compensation awarded to clients if the professional is found to be at fault.
- Risk Management – Encourages professionals to maintain high standards and avoid negligence in their work.
- Client Confidence – Assures clients that they can seek compensation if they suffer losses due to professional errors.
- Compliance – For RICS members, having PII is a regulatory requirement to ensure the protection of clients and the profession's integrity
44
What benefit does PII provide to a professional?
- Financial Protection – Covers the cost of defending against claims, including legal fees and compensation, in case of negligence or errors.
- Risk Management – Encourages professionals to maintain high standards of practice and avoid making mistakes that could lead to claims.
- Client Trust and Confidence – Assures clients that they can be compensated if they suffer a loss due to the professional’s errors or omissions, enhancing the professional's reputation.
- Regulatory Compliance – For RICS members, having PII is a mandatory requirement, ensuring that professionals comply with industry regulations and protect their practice from potential liabilities.
45
What benefits does PII provide the client?
- Financial Protection – Ensures that clients can receive compensation if they suffer financial loss due to the professional’s mistakes, negligence, or omissions.
- Confidence in Services – Clients can trust that they are working with a professional who is insured and responsible, knowing they have a safety net in case of errors.
- Access to Legal Recourse – PII covers legal fees, allowing clients to seek a fair resolution in case of a dispute or claim against the professional.
- Security and Accountability – Encourages professionals to maintain high standards and reduces the risk of professional misconduct, ensuring that clients are better protected.
46
What does "claims made basis" mean?
- Insurance policy where coverage is provided for claims made during the policy period, regardless of when the event causing the claim occurred.
- Coverage is based on when the claim is made, not when the incident took place.
- The policy must be in force at the time the claim is reported.
- Claims for incidents that occur after the policy ends are not covered, even if the incident happened during the policy period.
- This type of policy is common with PII
47
On what basis is PII underwritten in the UK?
- PII in the UK is typically underwritten on a "claims made" basis, meaning coverage applies to claims made during the policy period, regardless of when the incident occurred
48
What are the requirements for PII set by the RICS?
- Minimum Indemnity Levels based on annual turnover:
£100,000 or less = £250,000
£100,001 to £200,000 = £500,000
Over £200,000 = £1,000,000
- Uninsured Excess limits:
Up to £500,000 indemnity = Greater of 2.5% of sum insured or £10,000
Over £500,000 indemnity = 2.5% of sum insured
- Policy Basis: Must be on a claims made basis with full civil liability coverage.
- Retroactive Coverage: Policies should be fully retroactive, covering all prior work.
- Run-Off Cover: Required if the firm ceases trading, with a minimum of £1,000,000 aggregate coverage for six years post-cessation.
- Insurer Requirements: Must be underwritten by an RICS-listed insurer.
- Employee Coverage: Includes all past and present partners, directors, members, and employees.
- Fire Safety Coverage: From 1 July 2024, mandatory cover for fire safety claims related to buildings five storeys and above.
49
What are the new RICS minimum levels of indemnity?
- From 1 July 2024
- If a firm earns up to £100,000 a year, there needs to be at least £250,000 insurance for each claim
- If the firm earns £100,001 to £200,000, there needs to be £500,000 per claim.
- If the firm earns over £200,000, there needs to be £1,000,000 per claim
- "Each and every claim" means this amount is available for every separate claim, not just a total limit for the year.
50
What are the new RICS levels of maximum level of uninsured excess?
- From 1 July 2024
- For policies with a limit of indemnity of £10 million or less, the maximum uninsured excess is the greater of 2.5% of the sum insured or £10,000
- For policies with a limit of indemnity over £10 million, there is no set maximum uninsured excess
51
How do you differentiate between the different categories of CPD?
By using the RICS CPD decision tree
- Identify the Learning Activity: Is the activity structured (formal) or unstructured (informal)?
- Assess Relevance: Does the activity relate to your current role, development needs, or career goals?
- Learning Outcome: Does the activity result in tangible learning or improvement in your professional skills?
- Reflection: After completion, reflect on what you learned and how it will enhance your professional practice.
- Record the Activity: Log the activity in your CPD record
52
What articles do you read?
- RICS journals
- Articles on MODUS and the RICS website
- "Deluge defence: smart solutions for when the rain comes"
Published: 14 April 2025
The piece discusses innovative approaches to managing flood risks, including the use of smart technologies and infrastructure to protect communities from heavy rainfall
53
How do you keep up to date with topical issues?
- By following updates on the RICS MODUS and journals
- Conversations in the workplace
54
What is your CPD strategy?
- Continue with my diary entries
- Continue with personal research to develop my competence and knowledge
55
What measures should be taken to try and avoid PII claims?
- Clear Communication: Set realistic expectations with clients about services, timelines, and costs.
- Accurate Documentation: Maintain detailed records of all client interactions, advice, and decisions
- Follow Best Practices: Adhere to industry standards, guidelines, and codes of conduct.
- Regular Training: Ensure staff are well-trained in legal and professional standards.
- Risk Management: Regularly review projects for potential risks and address issues promptly.
- Professional Advice: Consult with legal or financial professionals when needed to avoid errors.
- Ensure Proper Contractual Agreements: Use clear, detailed contracts to define responsibilities and scope of work.
56
If you made a mistake on a cost plan, what would your insurance company expect?
- Prompt Notification: Inform your insurer as soon as the mistake is identified or a claim is likely.
- Full Disclosure - Provide detailed information about the error, its impact, and any actions taken to resolve it.
- Mitigation Efforts: Show that you’ve taken steps to mitigate the consequences of the mistake (e.g., correcting the plan, informing the client, or offering a solution).
- Documentation - Keep records of the mistake, communications with the client, and any corrective actions.
- Cooperation: Cooperate with the insurer’s investigation
57
How can you limit your liability when agreeing terms of appointment with a client?
- Clear Terms and Conditions - Specify the scope of work, responsibilities, and limitations in writing.
- Exclusions of Liability - Include clauses that limit liability for indirect, consequential, or unforeseeable damages.
- Limiting Financial Exposure - Set a cap on your liability, often based on your fees or a reasonable amount.
- Professional Indemnity Insurance - Ensure appropriate coverage is in place to back your limited liability.
- Avoid Over-Promising - Set realistic expectations regarding timeframes, costs, and deliverables to avoid future disputes.
- Use of Limitation of Liability Clauses - Insert clauses that specify time limits for clients to make claims against you (e.g., within a certain period after the work is completed).
- Indemnity Clauses - Where applicable, seek indemnity
from clients or third parties for certain risks.
58
What are the main elements included within a fee proposal?
- Scope of Work: Detailed description of the services and deliverables.
- Fee Structure: Clear breakdown of fees (hourly rate, fixed price, percentage-based, etc.).
- Timeline: Estimated duration for completing the work or project milestones.
- Payment Terms: Payment schedule, including deposit, progress payments, and final payment.
- Assumptions and Exclusions: Clarification of what is and isn’t included in the services.
- Liability and Insurance: Any limits on liability and the professional indemnity insurance coverage.
- Dispute Resolution: Mechanism for resolving any conflicts or disagreements (e.g., arbitration).
- Terms and Conditions: Any additional legal or contractual terms, including confidentiality clauses.
59
If you put together a fee proposal, but a couple of months into the job you realise you have under forecasted your resources, would you go back to the client and ask for more?
Here’s a flashcard for how to handle the situation of under-forecasting resources in a fee proposal:
---
Front:
If you under-forecasted your resources in a fee proposal, would you go back to the client and ask for more?
Back:
If you realize that you've under-forecasted your resources, the following steps are recommended:
- Review the Agreement: Check the terms and conditions of the original fee proposal to see if adjustments are allowed or if scope changes should be addressed.
- Assess the Situation: Determine if the issue is due to unforeseeable circumstances or if it was a miscalculation on your part.
- Communicate Transparently: Discuss the situation with the client as soon as possible, explaining the reasons for the under-forecasting and the need for an adjustment.
- Provide Evidence: Present a clear, factual breakdown of the additional resources required, including time and cost estimates.
- Negotiate Fairly: Be prepared to negotiate a reasonable fee adjustment, considering the client’s perspective and maintaining a professional relationship.
- Avoid Surprises: Ensure the client understands the impact on the project timeline, quality, or outcomes due to the resource underestimation
60
Once you and your client agree the services that are to be provided verbally, what should you do?
- Confirm in Writing: Send a summary of the verbal agreement.
- Outline Scope & Terms: Define services, fees, and timelines.
- Create a Contract: Draft formal terms for client approval.
- Get Acknowledgment: Ensure client agrees in writing.
61
What is a conflict of interest?
Anything that impedes or could be perceived to impede a business or individuals ability to act impartially or in the best interest of their client
62
How could a COI be managed internally if two departments were working for the same client?
- Segregation of Roles: Clearly separate the departments’ responsibilities to avoid overlap in decision-making or advice.
- Internal Disclosure: Ensure all relevant staff are aware of the potential COI and disclose it formally.
- Confidentiality Agreements: Implement strict confidentiality agreements between departments to prevent sharing of sensitive information.
- Independent Oversight: Appoint an independent individual or team to oversee the work and ensure impartiality.
- Client Consent: Inform the client about the COI and seek their written consent to continue working on the project.
63
If the client was insistent that you worked for them, despite a COI, how would you proceed?
- Reiterate the COI: Clearly explain the conflict of interest and potential ethical issues involved.
- Seek Mitigation: Propose measures to manage the COI, such as segregating roles or appointing an independent party to oversee the work.
- Client’s Informed Consent: Ensure the client understands the COI and has given written consent to proceed.
- Internal Controls: Implement strict internal procedures, including confidentiality agreements and separate teams, to manage the risk.
- Consult RICS Guidance: Follow RICS’ guidelines on conflicts of interest and seek advice from a senior colleague or ethics committee if necessary.
64
What are the main principles of the Bribery Act 2010?
- Prohibition of Bribery: It is illegal to offer, promise, or give a bribe or to request, agree to receive, or accept a bribe.
- Corporate Liability: Companies can be held liable for failing to prevent bribery, even if the bribery is committed by employees or associates.
- Penalties: Individuals and companies can face severe penalties, including imprisonment for individuals and unlimited fines for businesses.
- Adequate Procedures: Companies are required to have anti-bribery policies in place to prevent bribery within their operations.
65
What prevention should companies have in place to stop bribery
- Anti-Bribery Policy: Implement a clear, written anti-bribery policy outlining unacceptable behaviors.
- Training: Provide regular training for employees and third parties on identifying and preventing bribery.
- Due Diligence: Conduct thorough due diligence on clients, suppliers, and business partners to assess potential bribery risks.
- Whistleblower Mechanism: Establish a confidential reporting system for employees to report bribery concerns without fear of retaliation.
- Monitoring and Auditing: Regularly monitor and audit financial transactions and business practices for signs of bribery.
- Disciplinary Procedures: Enforce strict consequences for anyone involved in bribery or unethical behavior.
66
Under the bribery act, in what circumstance is a facilitation payment permitted?
- Facilitation payments are not permitted under the Bribery Act 2010. However, there is an exception if the payment is made to avoid a threat of physical harm. In such cases, the payment may be considered a legitimate act of self-defense to protect the individual or others from immediate harm, but it must be reported.
67
You are attending a business conference where it is announced you have won an IPAD. How would you act?
- Prizes of significant values could be interpreted as a bribe
- My companies gift register allows gifts up to £50
- I would decline the prize
- Report it to my line manager
68
What the Money Laundering Regulations (MLR) 2017?
- MLR 2017: Introduced a risk-based approach to anti-money laundering and terrorist financing, requiring businesses to conduct customer due diligence and report suspicious activities.
- OPBAS Regulations 2017: Established the Office for Professional Body Anti-Money Laundering Supervision (OPBAS), which oversees professional bodies to ensure consistent and effective AML supervision.
- Amendments in 2021: The Money Laundering and Terrorist Financing Regulations 2021 added a schedule listing high-risk third countries, enhancing due diligence requirements for transactions involving these jurisdictions.
- Economic Crime Act 2022: Introduced measures to improve transparency in corporate ownership and strengthen enforcement against economic crime, complementing the MLR 2017 framework.
69
What are money laundering red flags?
- Unusual Transactions: Large, unexplained cash deposits or withdrawals.
- Complex Ownership Structures: Unclear or opaque ownership of companies or assets.
- Reluctance to Provide Information: Client unwilling to provide necessary information or provide vague responses.
- Frequent Wire Transfers: Unexplained international transfers, especially to or from high-risk countries.
- Unusual Source of Funds: Funds from unexpected or questionable sources.
- Overpayment for Goods/Services: Overpayment followed by a request for refunds.
- Inconsistent Financial Activity: Transactions that don’t align with the client’s known business activity or history.
70
What is money laundering?
Money laundering is the process of making illegally gained money look like it came from a legal source.
71
What is the status of the RICS professional statement
It is mandatory to all RICs members and firms, including trainees
72
What is a locum agreement?
A locum agreement is a contract where a temporary professional is appointed to cover duties when the regular person is absent.
73
What are the different RICS documents
- Rules of Conduct
- Professional Statements
- Guidance Notes
- Code of Practice
- Jurisdiction guides
74
75
Why do you want to become chartered?
- Best standard of my profession
- The guidance and support from RICS
- Continued learning and development
- To help others become chartered
76
What status is the RICS PI requirements doc?
A regulation document and mandatory for all RICS-regulated firms to comply to
77
How many years after an instruction can a PI claim be made?
Up to 6 years after the alleged negligence, or 12 years if the contract is signed as a deed
78
79
Why are ethics important?
Ethics build trust, protect the public, uphold professional standards, and maintain the reputation of the profession.
80
What are the 3 types of due diligence?
- Legal due diligence
- Financial due diligence
- Technical due diligence
81
What is Legal Due Diligence?
Checking ownership, contracts, legal risks, and compliance with laws.
82
What is Financial Due Diligence?
Reviewing financial records, liabilities, costs, and valuations to assess risks
83
What is Technical Due Diligence?
Inspecting the physical condition, construction quality, and compliance of a property or asset.
84
Who is the RICS president and vice president?
- Acting President - Nick MacClean FRICS
- Vice president - Maureen Ehrenberg FRICS
85
When did RICS receive royal charter?
1881
86
What is royal charter?
A Royal Charter is an official document granted by the monarch, giving a professional body or organization special rights, privileges, or status. It often signifies the organization’s importance and trust within society.
87
What are the 4 levels of membership?
1. Student - training
2. Associate (AssocRICS) - a qualified professional with a recognized qualification or experience but has not yet reached Chartered status.
3. Chartered Member (MRICS) - has completed the required education, training, and exams, meeting RICS’ high professional standards in surveying
4. Fellow (FRICS) - experienced and highly qualified member who has made significant contributions to the profession and demonstrated leadership
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How do you become a Fellow?
To become a Fellow (FRICS), you must have at least 5 years of post-qualification experience as an MRICS and demonstrate significant contributions to the profession, leadership, and expertise in your field
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How is the RICS Governance Stucture shaped?
1. Royal Charter – Grants RICS special status and authority.
2. Governing Council – The main decision-making body, setting strategic direction.
3. RICS President & Senior Vice President – Lead the organization and represent RICS globally.
4. Board of Trustees – Ensures financial oversight and compliance.
5. Committees & Panels – Focus on specific areas like regulation, standards, and ethics.
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What is the role of the Governing Council in RICS?
The Governing Council sets the strategic direction of RICS, ensuring that the organization’s objectives align with the interests of its members and the wider public. It consists of elected members and regional representatives
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What is the role of the RICS President & Senior Vice President?
The President represents RICS externally, chairs meetings, and leads the Presidential Team. The Senior Vice President supports the President and typically succeeds them in the following year, ensuring leadership continuity
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What is the role of the Board of Trustees in RICS?
The Board of Trustees is responsible for financial oversight, risk management, and ensuring RICS operates in accordance with its charter. They ensure compliance and accountability in RICS' governance.
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What are the Committees & Panels in RICS?
RICS has several specialized committees and panels that focus on key areas such as:
- Regulation - setting standards and maintaining professional integrity
- Ethics - ensuring ethical practices in the profession
- Disciplinary Panel - handling breaches of conduct and disciplinary matters
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What is the role of the Audit Committee in RICS?
The Audit Committee ensures financial transparency and integrity within RICS. It oversees the audit process, reviews financial statements, and assesses internal controls to ensure compliance with legal and regulatory standards
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What is a Regulatory Tribunal in RICS?
A Regulatory Tribunal is an independent body that hears cases involving professional misconduct or breaches of RICS' rules. It determines sanctions, such as fines or suspension, for members found guilty of unethical behavior or non-compliance
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What do you know about the RICS Guidance Note: Complaints Handling (2016)?
The RICS Guidance Note: Complaints Handling (2016) outlines best practices for handling complaints from clients and the public. It emphasizes:
1. Timely and fair resolution of complaints.
2. The need for clear procedures for members and firms to follow.
3. Encourages transparency and clear communication with complainants.
4. Recommends independent review if a complaint cannot be resolved internally.
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What are the RICS minimum procedures for the Complaints Handling Procedure?
The RICS Minimum Procedures require firms to:
1. Acknowledge complaints within 7 days.
2. Investigate complaints thoroughly and impartially.
3. Provide a written response within 28 days.
4. Inform clients about the process for escalating complaints if unsatisfied (e.g., to RICS or an independent mediator).
5. Keep detailed records of complaints and resolutions.
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Are you aware of any new RICS Guidance on insurance?
- Fire safety coverage for buildings 5+ storeys.
- EWS1 Forms and FRAEW coverage.
- Retroactive date set to 1 July 2024.
- Run-off cover for 6 years with £1,000,000 limit.
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What money laundering checks do you need to do for private limited companies?
- Identify the company - verify name, registration number, and legal status with Companies House.
- Identify beneficial owners - individuals who own or control the company (e.g., shareholders with 25% or more).
- Assess the purpose of the business - Understand the nature of the company’s activities.
- Check for politically exposed persons (PEPs) - Ensure none of the owners or directors are PEPs.
- Monitor transactions - Keep track of unusual or suspicious activity, including large, complex, or unexplained transactions.
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How many RICS members are there?
There are approximately 144,000 members of RICS worldwide as of 2025.
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Who is the RICS CEO?
Justin Young
Since July 2023
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What is your membership number?
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What is the RICS black book?
The RICS Black Book is a guidance document providing standards, best practices, and technical advice on key topics in the surveying profession. It covers areas like building surveying, property management, and valuation, helping RICS members stay up-to-date with industry standards.
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What are the the RICS black books on?
The RICS Black Books cover a variety of topics including:
1. Building Surveying
2. Property Management
3. Valuation
4. Construction
5. Dispute Resolution
6. Facilities Management
Each book provides best practice standards, guidance, and technical advice for professionals in these fields.
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What is the Privy Council in RICS?
The Privy Council in RICS is a body that provides advice and oversight on key matters related to RICS' Royal Charter and governance. It ensures that RICS complies with legal requirements and operates in the public interest. The Council consists of senior members and is integral to maintaining RICS' professional standing.
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What are underhand (simple) contracts?
- These are informal, non-written contracts that may be verbal or implied by the actions of the parties involved.
- Typically governed by general contract law and are easier to enter into but harder to enforce compared to deeds.
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What are Deed Contract?
- A deed is a formal, written agreement that must be executed with specific formalities (e.g., being signed, witnessed, and sometimes sealed).
- Deeds carry a higher level of formality and provide stronger legal protection.
- The limitation period for claims under a deed is longer than for simple contracts (12 years versus 6 years).
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When did the RICS gain Royal Charter?
1881
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What are the RICS core material documents?
- The Rules of Conduct
- The RICS Professional Standards
- Codes of Practice
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What are the Rules of Conduct for Members?
- Interpretation - the meaning of member who the ruled apply
- Communication - how RICS communicate with members
- Ethical Behaviour - act with integrity
- Competence - complete work with skill, care and diligence
- Service - proper regard for standards of service
- CPD - up to date
- Solvency - personal and professional finances are managed appropriately
- Information to the RICS - in a timely manner
- Co-operation - with the RICS and regulatory board
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What are the Rules of Conduct for Firms?
- Interpretation - the meaning of member who the ruled apply
- Communication - how RICS communicate with members
- Professional Behaviour - act with integrity
- Competence - complete work with skill, care and diligence
- Service - proper regard for standards of service
- CPD - up to date
- Complaints Handling Procedure
- Clients Money - preserving the security
- Professional Indemnity Insurance - previous and current work covered by PII meeting standards approved by Regulatoey Board
- Advertising - promoting professional services in a truthful and professional manner
- Solvency - personal and professional finances are managed appropriately
- Arrangement to cover the incapable or death of a sole practitioner
- Use of designations - on purpose listed literature that is RICS regulated
- Information to the RICS - in a timely manner
- Co-operation - with the RICS and regulatory board
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What is your understanding of Rule 1 - acting with integrity?
To be honest and straightforward in all that you do
- being open and transparent in the way that you work
- respecting confidential information of your client or potential client
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What is your understanding of Rule 2 - always provide a high standard of service?
Ensure your client or other who you have a professional responsibility, receive yhe best possible advice and support
- act within your scope of competence
- communicate with your client in a way which will allow them to make informed decisions
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What is your understanding of Rule 3 - acting in a way which promotes truth in the profession?
Act in a manner to promote you, your firm or the organisation you work for in a professional and positive way
- understanding being a professional is how you behave in your professional and private life
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What is your understanding of Rule 4 - treat others with respect?
Treat everyone with courtesy and respect
- encourage the fair and respectful treatment of clients
- consider cultural sensitivities and business practices
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What is your understanding of Rule 5 - take responsibility?
Be accountable for your actions
- always act with skill, car and diligence
- if someone makes a complaint, reply in a professional manner and aim to resolve the matter as best you can
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How to you adhere to the Rules of Conduct in your daily work?
- by being open and honest with my client
- I act within my scope of competence.
- I understand that I represent my clients, my company and RICS when attending meetings
- I take responsibility for my work
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What is CPD? Why is it important?
Continuing Professional Development
It's a commitment by members to continually update their skills and knowledge in order to remain professional competent
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What do PII claims commonly arise from?
- Negligence, ommission or error
- Unintentional breach of intellectual property rights (i.e. trademark)
- Loss of clients data
- Unintentional misuse or breach of confidential information
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Why should tou inform your PI insurer if your company has received a complaint?
Because there may be a possibility that the complaint could lead to a claim
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What are the RICS Standards?
Technical and professional guidance documents that provide best practices for surveying professionals
Including RICS Valuation- Global Standards (The Red Book)
RiCS Property Measurement Standards
RICS Sustainability
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What checks do you need to do on a new client before accepting an instruction?
- Review companies identity and legitimacy (registration detauls)
- Purpose of instruction
- Anti-Money Laundering checks
- Conflict of interest
- Terms of Engagement
- Financial Checks
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If you suspected someone was money laundering, how would you deal with this?
- don't tip off the client (under Proceeds of Crime Act 2002 and Money Laundering Regs)
- Report Internally to the Money Laundering Report Officed
- File Suspicious Activity Report (SAR) if sole practitioner (to UKs National Crime Agency)
- Pause transactions if necessary
- Document everything
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I'm relation to anti money laundering, what checks do you need to do?
- Customer Due Diligence (CDD) to identify the client
- Enhanced Due Diligence (EDD) when the risk is higher - client being Polictically Exposed Person (PEP)
- Screen clients against UK sanctions list and PEP registers
- Ongoing monitoring and record keeping
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What is the difference between a practice statement and a guidance note? Can you give an example of one you have followed?
Practice statement is mandatory and outlines the minimum standard for professional practice.
Whereas a guidance note is recommendations which provided best practice.
I have followed the RICS Valuation Global Standards (Red Book) when completing valuations for clients
I have followed the RICS Guidance Note on Property Measurement recommending best practice
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What are the RICS requirement for setting up a firm?
Registration with RICS
PII
Compliance with RICS rules of conduct
Anti money laundering compliance (CDD & SARs)
Quality management and control systems (such a internal audits, training)
