Lesson 22 - conduct of business requirements

Question 1

What is the difference between execution only and best execution?

Answer 1

This relates to stocks and shares advice.

Execution = No advice given the individual just chooses where they want there investment to go. (No FCA monitoring of this).

Best execution = The advice needs to be the best advice given and done with speed.

Question 2

Insurance company conduct of business rules (ICOBS)

What is it?
Name the 5 rules

Answer 2

• Regulated by the FCA
  There are 3 types
  1. General Insurance - Car insurance
  2. Protection - Mortgage
  3. PPI
  Icob rules:
  4. Disclosure
  5. Demands and needs
  6. Product disclosure
  7. Cancellation notices
  8. Claims handling

Question 3

How are banks monitored?
7 rules (BCOBS)

Answer 3

1. Adhere to rules
2. Communicate with customers
3. Deal
4. Correct information
5. Post sales activity
6. Cancellation rights
7. Information published

Question 4

Name the 4 payment services regulations

Answer 4

1. Banks
2. Building societies
3. Merchants
4. Remmitters - (send money abroad)

Question 5

What is PSD2 Payment service directive

Answer 5

Protection for customers when paying with chip and pin - Make them safer to use.

Question 6

What are the 6 standards of learning practices

Answer 6

1. Promotion
2. Product sales
3. Managing customers
4. Money management
5. Financial difficulty
6. How to deal with vulnerable customers

Question 7

In PSD2 Payment services directive. What is “Open banking”.

Answer 7

This will speed things up. Rather than lots of paperwork, lenders can link straight into applicants:
* Bank accounts.
* Access registry details.
* Talk to credit reference agancies.
* Can connect to anti money laundering.

Question 8

COBS - Fact find
Name the 3 types of customers

Answer 8

1. Retail
2. Professional
3. Counter party - big institution

Question 9

How long should you
1. Keep data
2. Pension transfers

Answer 9

1 = 5 years
2 = Forever