Part B Flashcards
A client calls Tom, a representative. The client wants to add a new born baby on a medical aid. Tom sends the details of the client for underwriting process to be concluded. In terms of FAIS Act, what is the role played by John?
A.
Intermediary
B.
Advice
C.
Administrative and advice
D.
Administrative
A.
Intermediary
A client took a plan in 2014 from a sole proprietor. In Jan 2015, the client realised that he was given wrong advice but the sole proprietor has lapsed the license. The client wants to complain against the advice that he was given, in which time frame should the client take the complaint to the ombudsman.
A.
Jan 2018
B.
April 2015
C.
October 2015
D.
Jan 2016
A.
Jan 2018
Marie inherited R30 000.00 from his grandmother. She informs the representative that she did not want to pay tax for 5 years. What is the consequence of this?
A.
Report him for tax evasion to FIC
wrong
B.
Report to the money laundering reporting officer
C.
He is an undesirable client
D.
Report him to FIC
A.
Intermediary
What is the required minimum CPD points for a representative rendering financial services for Short Term Personal lines and Short term Commercial Lines:
A.6
B.12
C.18
D.0
C.18
Which of the following is not a competence requirement for a Key Individual?
A.RE
B.Class of Business Training
C.Product Specific Training
D.CPD.
C.Product Specific Training
Considering the following disclosure made by Miss. Rose (the advisor) to her client:
“I earn income from commission that the product supplier pays over to me and the products purchased by my clients. An amount of R45.00 is levied against the product on a monthly basis. The amount is paid out to Miss Rose. The total annual amount levied totals R540.00.”
Which of the following statements need NOT be disclosed to the client?
A.An amount of R45.00 is levied against the product
B.The amount is paid out on a monthly basis
C.The amount is paid out to Miss Rose
D.The total annual amount levied is R540.00
C.The amount is paid out to Miss Rose
Under which of the following circumstances could a FSP debar a Representative, and prevent him/her from rendering any new financial services on its behalf? Where the Representative no longer complies with the Determination of Fit and Proper Requirements for FSPs in respect of:
i) competence
ii) continued professional development
iii) Honesty, integrity and good standing
iv) financial soundness
v) operational ability
A.(i) and (iii)
B.(i), (ii) and (iii)
C.(i), (iii) and (v)
D.(i), (iii), (iv) and (v)
B.(i), (ii) and (iii)
Laura, a Representative, is informed by the Key Individual, Thami, that the FSP wants to extend her authorisation to include Long Term Insurance Category B. She will work under Thami’s supervision. Joel started as a Representative with the FSP on 1 February 2009 and is currently authorised to sell Short Term Insurance: Commercial Lines and Short Term Insurance: Personal Lines. The following information need NOT be communicated on the Representative register that is sent to the FSCA:
A.Laura’s details
B.Thami’s details
C.Long Term Insurance Category B
D.Short Term Insurance: Commercial Lines and Short Term Insurance: Personal Lines
correct
B.Thami’s details
ABC (Pty) Ltd is unable to get a FSP licence due to the fact that their only director, Rorisang Mojapelo does not meet the Determination of Fit and Proper Requirements for FSPs. ABC (Pty) Ltd does not have any other staff who do meet the requirements for a Key Individual. They approached another FSP to appoint them as a juristic Representative under their licence. The FSP’s response should be:
A.Appoint ABC as a juristic Representative and appoint Rorisang Mojapelo as a Representative under supervision until he has gained the required experience.
B.Inform ABC that the FSP cannot appoint ABC as a juristic Representative or appoint Rorisang Mojapelo as a Representative.
C.Appoint ABC as a juristic Representative and appoint another person who qualifies as their Key Individual.
D.Appoint ABC as a juristic Representative and appoint Rorisang Mojapelo as a Representative under supervision until he has gained the required qualification.
B.Inform ABC that the FSP cannot appoint ABC as a juristic Representative or appoint Rorisang Mojapelo as a Representative.
Miss Karen is the Personal Assistant to Mr Smith, the only Key Individual of Smith Financial Advisors CC. Miss Karen renders financial services on behalf of Mr Smith and is appointed as a Representative. Which of her duties listed below fall within the scope of her role as a Representative?
i) Receiving, submitting and processing client claims
ii) Collection of premiums from clients
iii) Exercising of judgement to assist clients in choosing products
v) Rendering of administrative or clerical services to the Key Individual
v) Gathering information on the client’s existing financial portfolio
A.(i), (iii) and (iv)
B.(i), (iii) and (v)
C.(ii), (iii) and (iv)
D.(i), (ii) and (iii)
D.(i), (ii) and (iii)
Kobus is part of the administrative team for MIC Insurance Brokers. Part of her duties includes gathering information from the broker’s clients, explaining the disclosure document and processing all the claims that the client submits. Should Kobus be appointed as a Representative?
A.Yes, she provides intermediary services
B.Yes, she provides advice
C.No, she only performs intermediary services
D.No, she only performs administrative tasks
A.Yes, she provides intermediary services
Before a Representative can provide financial advice he/she must be added to the FSP’s register of Representatives. This information must be sent to the FSCA by:
A.the Representative within 15 days after his/her appointment.
B.the Representative within 30 days after his/her appointment.
C.the Key Individual within 15 days after the Representative’s appointment.
D.the Key Individual within 30 days after the Representative’s appointment.
C.the Key Individual within 15 days after the Representative’s appointment.
Select the INCORRECT option. The license application of Integrity Brokers was successful. However, the Commissioner could consider withdrawing the FSP’s license if satisfied, on the basis of available facts and information, that the FSP when applying for the license:
A.did not pay the full licensing fee that the FSCA invoiced.
B.did not make a full disclosure of all relevant information.
C.did not submit a complete Representative register.
D.furnished misleading information to the Commissioner.
C.did not submit a complete Representative register.
What is the main difference between the lapsing of a licence and the withdrawal of a licence?
A.A withdrawal of a licence may only be done by the Ombud for FSPs or the Commissioner.
B.A licence may only be lapsed by the Commissioner for the non-payment of levies.
C.A licence can only be lapsed by an authorised FSP.
D.A licence can only be withdrawn by an authorised FSP.
C.A licence can only be lapsed by an authorised FSP.
Select the INCORRECT option. Bitsacco is a FSP who holds funds on behalf of clients and maintains a separate bank account for these funds. Bitsacco must:
A.ensure that the account only contains funds of clients and no FSP funds.
B.pay the funds of clients into the account within 5 business days of receipt.
C.pay all bank charges except charges specifically relating to a deposit or withdrawal of the funds of clients.
D.ensure that the interest accruing to funds is paid to the client or owner of such funds.
B.pay the funds of clients into the account within 5 business days of receipt.
How many license sub-categories are there in licence Category I?
A.14
B.18
C.26
D.20
C.26
Which of the following is NOT defined as a financial product in terms of the FAIS Act?
A.Assistance Policies
B.Bank Deposits
C.Hedge Funds
D.Warrants
C.Hedge Funds
A Representative may be authorised to render intermediary services without supervision only for the following financial products:
i) all of those for which the FSP is appropriately authorised.
ii) all of those for which the Representative meets the Fit and Proper requirements.
iii) all of those for which the product suppliers have contracts with the FSP.
iv) all of those for which the Representative has sufficient experience.
A.(i) and (ii)
B.(ii) and (iv)
C.(ii), (iii) and (iv)
D.(i), (ii) and (iv)
B.(ii) and (iv)
FSPs must have appropriate procedures and systems in place to keep client records and documentation safe from destruction. Records should ideally be kept:
A.in a steel filing cabinet.
B.in a lockable storeroom.
C.on the hard drive of an office computer.
D.in a fire-proof safe
C.on the hard drive of an office computer.
Palesa is new in the company. He changed the way in which the company was keeping records. Before the company was storing the records manually. Now the records are being stored electronically in different offices. He is to present this new system to the board. What will be his best explanation?
A.The commissioner changed the way records are kept effective 1 Jan 2010.
B.To avoid keeping the papers manually and missing records.
C.Records must be kept safe from destruction.
D.Electronic records are cheap to maintain.
C.Records must be kept safe from destruction.
The FSP has two separate accounts, account 762 and account 546. There was an exceptional withdrawal and deposit from Account 762 to Account 546 thus the FSP took funds from Account 762 to account 546. The FSP also took funds from account 762 to account 546. Mr Do Santos a client has deposited an amount of R500, to which account must the FSP deposit Mr Do Santos´s fund?
A.762 within 1 business day
B.762 within 1 day
C.546 within 1 business day
D.546 within 24 hours
C.546 within 1 business day
When must an FSP issue a written confirmation of receipt of funds received without a bank being used?
A.Immediately
B.Within 1 day
C.Within 1 business day
D.Within 24 hours
A.Immediately
An FSP which receives clients funds, received a deposit of R20 000 from a client on Friday 11am. By when must the funds be deposited in a separate bank account?
A.Saturday by 11am
B.Next Monday by 11am
C.Friday by 4pm
D.Friday by 00:00 hrs
B.Next Monday by 11am
Mr Smith deposited money on the 1st of August at 12:00 Hrs. When must an FSP deposit the funds in a separate bank account?
A.1st August 16:00 hrs
B.2nd August 12:00 hrs
C.1st August 00:00 hrs
D.2nd August 00:00 hrs
B.2nd August 12:00 hrs
