CISI: UK Regulation & Professional Integrity
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Q1. What is the role of the FCA’s Regulatory Decisions Committee (RDC)?
A. Sets UK interest rates
B. Makes enforcement and supervisory decisions independently of FCA case
teams
C. Oversees monetary policy
D. Manages the FSCS
Answer: B
Q2. Under COBS rules, firms must ensure communications with clients are:
A. Clear, fair, and not misleading
B. Focused on promoting firm profitability
C. Only required for retail clients
D. Exempt from FCA oversight if given verbally
Answer: A
Q3. The Senior Managers and Certification Regime (SM&CR) was introduced to:
A. Replace all COBS rules
B. Enhance individual accountability of senior managers in regulated firms
C. Transfer responsibility from firms to regulators
D. Exempt small firms from regulation
Answer: B
,Q4. Who sets monetary policy in the UK, including interest rates?
A. HM Treasury
B. The Monetary Policy Committee (MPC) of the Bank of England
C. The FCA
D. The PRA
Answer: B
Q5. Which of the following best describes “narrow money”?
A. All liquid assets and savings accounts
B. Money that includes highly liquid assets like cash and demand deposits
C. Broad definition of all assets in the economy
D. Government borrowing and taxation
Answer: B
Q6. Which of the following are primary functions of the US Federal Reserve?
A. Supervises national banks and issues charters
B. Holds cash reserves of depository institutions and manages monetary policy
C. Regulates broker-dealers and securities firms
D. Sets UK interest rates
Answer: B
Q7. The Office of the Comptroller of the Currency (OCC) is responsible for:
A. Regulating and supervising national banks in the US
B. Enforcing UK COBS rules
C. Overseeing securities trading in the UK
D. Managing consumer complaints in the US
Answer: A
,Q8. FINRA (Financial Industry Regulatory Authority) in the US:
A. Acts as the largest independent regulator of securities firms and brokers
B. Supervises the US Treasury
C. Sets fiscal policy in the UK
D. Oversees only investment banks in Europe
Answer: A
Q9. Under FCA rules, how long must firms hold records of term agreements?
A. One year minimum
B. Three years, unless the client requests deletion
C. Five years or the duration of the client relationship (pensions indefinitely)
D. Records are optional unless disputes arise
Answer: C
Q10. When is dealing as principal not considered a regulated activity?
A. When acting as a market maker in the normal course of business
B. When transacting with retail clients
C. When advising on financial promotions
D. When undertaking investment management
Answer: A
Q1. What is a Designated Investment Exchange (DIE)? (Select all that apply.)
A. An exchange overseas, recognised by the FCA as meeting investor protection
standards
B. Provides membership access to UK participants
C. Example: New York Stock Exchange (NYSE)
D. Requires FCA authorisation for UK membership trading
Answer: A, C
, Q2. How is a DIE different from a Recognised Overseas Investment Exchange
(ROIE)?
A. DIEs allow UK membership access, ROIEs do not
B. DIEs do not offer UK membership, while ROIEs permit UK market participants
C. DIEs are always UK-based, ROIEs overseas
D. ROIEs are formally recognised by the FCA for UK trading rights
Answer: B, D
Q3. What cannot be traded on an Organised Trading Facility (OTF)?
A. Derivatives
B. Bonds
C. Equities
D. Structured finance products
Answer: C
Q4. What are the FCA’s three-year strategic goals? (Select all that apply.)
A. Reducing and preventing serious harm
B. Setting and testing higher standards
C. Maximising profitability for firms
D. Promoting competition and positive change
Answer: A, B, D
Q5. What does EMIR regulate?
A. Over-the-counter derivatives
B. UK pensions
C. Equities trading on OTFs
D. Central bank interest rates
Answer: A
PRACTICE Verified Multiple Choice and Conceptual
Actual Emended Exam Questions With Reviewed
100% Correct Detailed Answers
Guaranteed Pass!!Current Update
Q1. What is the role of the FCA’s Regulatory Decisions Committee (RDC)?
A. Sets UK interest rates
B. Makes enforcement and supervisory decisions independently of FCA case
teams
C. Oversees monetary policy
D. Manages the FSCS
Answer: B
Q2. Under COBS rules, firms must ensure communications with clients are:
A. Clear, fair, and not misleading
B. Focused on promoting firm profitability
C. Only required for retail clients
D. Exempt from FCA oversight if given verbally
Answer: A
Q3. The Senior Managers and Certification Regime (SM&CR) was introduced to:
A. Replace all COBS rules
B. Enhance individual accountability of senior managers in regulated firms
C. Transfer responsibility from firms to regulators
D. Exempt small firms from regulation
Answer: B
,Q4. Who sets monetary policy in the UK, including interest rates?
A. HM Treasury
B. The Monetary Policy Committee (MPC) of the Bank of England
C. The FCA
D. The PRA
Answer: B
Q5. Which of the following best describes “narrow money”?
A. All liquid assets and savings accounts
B. Money that includes highly liquid assets like cash and demand deposits
C. Broad definition of all assets in the economy
D. Government borrowing and taxation
Answer: B
Q6. Which of the following are primary functions of the US Federal Reserve?
A. Supervises national banks and issues charters
B. Holds cash reserves of depository institutions and manages monetary policy
C. Regulates broker-dealers and securities firms
D. Sets UK interest rates
Answer: B
Q7. The Office of the Comptroller of the Currency (OCC) is responsible for:
A. Regulating and supervising national banks in the US
B. Enforcing UK COBS rules
C. Overseeing securities trading in the UK
D. Managing consumer complaints in the US
Answer: A
,Q8. FINRA (Financial Industry Regulatory Authority) in the US:
A. Acts as the largest independent regulator of securities firms and brokers
B. Supervises the US Treasury
C. Sets fiscal policy in the UK
D. Oversees only investment banks in Europe
Answer: A
Q9. Under FCA rules, how long must firms hold records of term agreements?
A. One year minimum
B. Three years, unless the client requests deletion
C. Five years or the duration of the client relationship (pensions indefinitely)
D. Records are optional unless disputes arise
Answer: C
Q10. When is dealing as principal not considered a regulated activity?
A. When acting as a market maker in the normal course of business
B. When transacting with retail clients
C. When advising on financial promotions
D. When undertaking investment management
Answer: A
Q1. What is a Designated Investment Exchange (DIE)? (Select all that apply.)
A. An exchange overseas, recognised by the FCA as meeting investor protection
standards
B. Provides membership access to UK participants
C. Example: New York Stock Exchange (NYSE)
D. Requires FCA authorisation for UK membership trading
Answer: A, C
, Q2. How is a DIE different from a Recognised Overseas Investment Exchange
(ROIE)?
A. DIEs allow UK membership access, ROIEs do not
B. DIEs do not offer UK membership, while ROIEs permit UK market participants
C. DIEs are always UK-based, ROIEs overseas
D. ROIEs are formally recognised by the FCA for UK trading rights
Answer: B, D
Q3. What cannot be traded on an Organised Trading Facility (OTF)?
A. Derivatives
B. Bonds
C. Equities
D. Structured finance products
Answer: C
Q4. What are the FCA’s three-year strategic goals? (Select all that apply.)
A. Reducing and preventing serious harm
B. Setting and testing higher standards
C. Maximising profitability for firms
D. Promoting competition and positive change
Answer: A, B, D
Q5. What does EMIR regulate?
A. Over-the-counter derivatives
B. UK pensions
C. Equities trading on OTFs
D. Central bank interest rates
Answer: A
