Part A Flashcards
An FSP must keep the record for:
A.
Min 5 years
B.
Min 5 years and if the commissioner requested the record you must keep it for 10 years.
C.
Max 5 years
D.
Only for 5 years
A.
Min 5 years
A rep is authorised to render intermediary services only. The KI realised that the representative rendered advice to a client. What must the KI do?
A.
KI must write the letter to FSCA stating that the rep is only allowed to render intermediary services and will not give advice anymore.
B.
The KI must debar the rep.
C.
The rep must get experience to render advice.
D.
The rep must write a letter to the FSCA asking to be pardoned and give reasons.
B.
The KI must debar the rep.
The KI disclosed a commission of R4000 to a client. The representatives noticed an error on the commission and that the commission charged is wrong, it is supposed to be R14 000. The product has been running for 3 years, so what must the representative do?
A.
The rep must call the client and inform the client of the correct commission.
B.
The rep must replace the product.
C.
The rep must deduct the commission not received for the past three years.
D.
The rep must keep quiet because this was disclosed by the KI
A.
The rep must call the client and inform the client of the correct commission.
What is the minimum qualification entry requirements for a representative rendering financial services for friendly society or long term insurance sub category A product.
A.
ABET, ability to read and write and make calculations
B.
Matric
C.
NQF level 4 Qualification
D.
Matric and Regulatory Examinations
A.
ABET, ability to read and write and make calculations
Jane has a BCom in Risk Management, and worked in USA for the past two years rendering financial services. FSP CC wants to hire her as a representative. Will she work under supervision?
A.
She has the experience, so she does not need to work under supervision.
B.
No she cannot work under supervision because she needs to pass RE before she can work.
C.
Yes, she has to work under supervision because her experience was gained in USA and may not be applicable to South Africa.
D.
She has to work under supervision to prove her honesty, integrity and good standing.
A.
She has the experience, so she does not need to work under supervision.
When a client wants to terminate a financial product. When must the FSP process the termination?
A.
With immediate effect
B.
Tell the client the procedure of cancelling the product in writing first.
C.
Tell the client the consequences for terminating the financial product.
D.
Inform the client that they need to give the FSP a notice.
A.
With immediate effect
A key individual may delegate his job to a:
A.
Compliance officer
B.
Manager
C.
Rep
D.
Key Individual
D.
Key Individual
The Compliance Officer finds that there was a case of non-compliance. What must the Compliance Officer do?
A.
Inform the FSP
B.
Inform the FSP and not mention it on the compliance report because he may not get payment since he is outsourced.
C.
Inform the KI and mention it on the Compliance report.
D.
Inform the FSP and mention it on the compliance report.
C.
Inform the KI and mention it on the Compliance report.
An FSP has two shareholders. Jane has more shares: 70% and Mary has 30%. What happens to the FSP if Jane dies:
A.
License lapses.
B.
The FSP continues with its operations.
C.
The remaining shareholder must reapply for a license.
D.
License withdrawal.
B.
The FSP continues with its operations.
When does a Sole Proprietor FSP lapse.
I. Temporary ill
II. Dies
III. Finally sequestrated
IV. Dormant
V. If commissioner instructs the FSP to Lapse
A.
I and II
B.
II and III
C.
IV
D.
I, II, III, IV and V
B.
II and III
A business practise has been declared undesirable by the commissioner, what must an FSP do?
A.
Stop the business practise immediately.
B.
The FSP has 21 days to give response.
wrong
C.
Publish in the gazette or official website
D.
Rectify or reinstate any affected client within 60 days.
A.
Stop the business practise immediately.
The commissioner is considering to declare a business practise undesirable. What must the commissioner do?
A.
Publish the intention in the gazette or official website and give FSPs 21 days to respond.
B.
Inform all FSPs to stop the business practise immediately.
C.
Give the FSPs 21 days to stop the practise.
D.
Inform all the FSPs to stop the business practise within 60 days.
A.
Publish the intention in the gazette or official website and give FSPs 21 days to respond.
What will happen if an FSP continues practising a practise which has been declared undesirable?
A.
The commissioner will ask the FSP to rectify or reinstate any affected client within 60 days.
B.
The commissioner will ask the FSP to send a presentation within 60 days.
C.
The commissioner will lapse the FSPs license and the FSP may re-apply for the license within 60 days.
D.
The commissioner will suspend the FSPs license and give an opportunity to the FSP to have the license reinstated within 60 days.
A.
The commissioner will ask the FSP to rectify or reinstate any affected client within 60 days.
What will happen if an FSP fails to rectify or reinstate the affected client within 60 days after the FSP had continued practising an undesirable business practise?
i. Fine of max R10m or max 10 years imprisonment or both.
ii. The commissioner will inform other FSPs not to continue doing business with the FSP.
iii. Fine of max R100m or max 15 years imprisonment or both.
iv. Fine of max R100m or max 30 years imprisonment or both.
v. Fine of max R10m or max 5 years imprisonment or both.
A.
i and ii
B.
i only
C.
ii and v
D.
iii only
A.
i and ii
An FSP was suspended and fined R20 000. What should the FSP do to have the license reinstated?
A.
A suspended license cannot be reinstated
B.
A suspended license will only lead to license withdrawal.
C.
Pay the fine and lapse the license.
D.
Pay the fine.
D.
Pay the fine.
The accreditation with the Medical Schemes Council of an FSP has lapsed. What will happen to the license of the FSP?
A.
It will be suspended.
B.
It will be reinstated.
C.
It will be withdrawn.
D.
It will be lapsed
D.
It will be lapsed
What should an FSP do to prevent a client from suffering financial loss due to negligence, theft or poor admin?
A.
Avoid misleading advertising.
B.
Disclose to clients that they may suffer financial loss.
C.
Have Suitable Guarantees, Professional Indemnity and Fidelity Insurance.
D.
Avoid conflict of interest
C.
Have Suitable Guarantees, Professional Indemnity and Fidelity Insurance.
The accreditation of an FSP was suspended. What will the commissioner do?
A.
The commissioner must publish in the gazette.
B.
The commissioner must inform all parties involved.
C.
The commissioner must suspend the license.
D.
The commissioner is not involved when an accreditation is suspended.
C.
The commissioner must suspend the license.
An ombudsman will consider a complaint which happened……
A.
More than 3 years ago.
B.
6 weeks ago and the client has not reported to the FSP.
C.
6 months ago and the client has not reported the complaint to the FSP.
D.
6 months ago and the client has reported the complaint to the FSP.
D.
6 months ago and the client has reported the complaint to the FSP.
FSP A is selling a product for Product Supplier B. Who needs to make the necessary disclosures?
A.
Manager
B.
Both parties
C.
FSP A
D.
Product Supplier B
C.
FSP A
Kgaugelo received advice from Tonderai who works for ABC FSP on the 1st of Feb 2018. Kgaugelo only realised that the advice was not adequate on the 1 June 2018. Kgaugelo made a complaint on the 1st of July 2018 to the Bitmari FSP and the FSP agrees with Tonderai´s advice. When must Kgaugelo take the matter to the ombudsman?
A.
September 2018, only after receiving a response from the FSP.
B.
September 2018, even without getting a response from the FSP.
C.
Immediately because she received the advice a long time ago.
D.
Immediately after sending the complaint to the FSP.
B.
September 2018, even without getting a response from the FSP.
How many shares must an FSP have in a Product supplier which would require no disclosure?
A.
5%
B.
20%
C.
12.5%
D.
30%
A.
5%
When must an FSP make adequate disclosure to a client?
A.
An FSP which has a shareholding of 10% in a product supplier must disclose to the client.
B.
An FSP which has a shareholding of more than 10% in a product supplier must disclose it to the client, and total remuneration including commission of less than 30% per previous calendar year.
C.
An FSP which has a shareholding of more than 30% in a product supplier must disclose it to the client, and total remuneration including commission of less than 10% per previous calendar year.
D.
An FSP which has a shareholding of more than 10% in a product supplier must disclose it to the client, and total remuneration including commission of more than 30% per previous calendar year.
D.
An FSP which has a shareholding of more than 10% in a product supplier must disclose it to the client, and total remuneration including commission of more than 30% per previous calendar year.
How much total remuneration or commission must an FSP have in a Product supplier which would require disclosure?
A.
5%
B.
20%
C.
25%
D.
35%
D.
35%
