CISI REGULATIONS EXAM - MOCK
EXAM COMPILATION CORRECT 100%
The FCA will notify an individual that they are subject to an investigation using which of
the following methods?
Letter to the individual's firm
Personal notice to the individual in writing
Telephone call
Personal notice to the individual by fax - ANSWERPersonal notice to the individual in
writing - durable medium
Where a communication by a firm contains an indication of the possible future
performance of a product, which of the following cannot be included?
The effects of commissions, fees or other charges.
The reasonable assumptions on which the performance is based.
A reference to the basis of the forecast being simulated past performance.
A warning that forecasts are not reliable indicators of future performance. -
ANSWERFuture performance estimates cannot be based on simulated past
performance.
Under the Terrorism Act 2000, when specifically should a suspicion of terrorist activities
be reported?
Without delay
Within 5 business days
By the next business day
As soon as reasonably practicable - ANSWERThe wording of the Terrorism Act is 'as
soon as reasonably practicable'.
When does the FCA publish details of a prohibition order?
After issuing a final notice
After issuing a warning
Once the FCA has notified the individual concerned and the firm
Once the FCA has notified the individual concerned - ANSWERFCA penalties are
effective once a final decision notice has been issued. Publication takes place at that
point.
After issuing a final notice
For how long must records relating to pension transfers be kept?
,Six years
Five years
Three years
Indefinitely - ANSWERIndefinitely (1 Mark)
Which of the following is not a 'disciplinary sanction'?
Financial penalty
Public censure
Statement of misconduct
Withdrawal of approval - ANSWERWithdrawal of approval will be used when an
individual is not fit and proper, and is a 'protective' or 'remedial' sanction.
Which of the following will constitute money laundering?
Ramping prices
Disseminating false rumours about a company
Passing on price sensitive information used for dealing
Entering into a number of transactions to hide the source of money - ANSWEROption
one and two are market abuse. Option three is insider dealing (or market abuse). Option
four is money laundering.
The main aim of the UK Investment Firms Prudential Regime (UK IFPR) is?
To focus the prudential requirements on the risks that the firm faces and considers
To focus the prudential requirements on the risks that the firm can pose to consumers
and markets
To focus the prudential requirements on the reputational risks that the firm may
To focus the prudential requirements on the risks that the firm presents to their
depositors - ANSWERTo focus the prudential requirements on the risks that the firm
can pose to consumers and markets
The approach under the IFPR is to consider the harm an FCA investment firm can
cause to others based on the activities that they carry out, and that the amount of
capital and liquid assets they hold is sufficient to undertake an orderly wind down.
Which of the following activities must be performed by an approved person?
Recruitment and training
Supervising other employees
Acting as a non-executive director
Working in compliance - ANSWERA non-executive director is a governing function and
so requires specific approval.
Which of the following is not part of the definition of terrorist activity in the Terrorism Act
2000?
, Action to intimidate the public.
Action to intimidate a government.
Action to advance a religious cause.
Action to advance a social cause. - ANSWERSocial cause. The rest are listed word for
word in the Act.
Which of the following per se professional clients cannot be an elective eligible
counterparty?
A supranational
The management group of a pension fund
A company with turnover of €50m and own funds of €5m
An institutional investor - ANSWERAn institutional investor cannot be an elective eligible
counterparty.
Following the UK's exit from the EU, Temporary Transitional Powers' (TTP) were
granted to UK branches of EU firms, or those looking to set up a branch in the UK until
31 March 2022. This enabled firms to prepare to be fully compliant with the UK regime
from 1 April 2022.
However, the regulator still expected those firms to be compliant with all of the following,
EXCEPT?
Market making exemption under the short selling rules
Securities Financing Transaction Regulation (SFTR) reporting
Commodity derivatives
Money laundering internal reporting procedures for suspicious transactions -
ANSWERMoney laundering internal reporting procedures for suspicious transactions.
Money laundering procedures for suspicious transaction reporting is covered under
different legislation, and is not part of the TTP.
Who is responsible for the approval of a mail shot sent by an appointed representative?
The FCA
The appointed representative
The firm
There is no requirement to approve a mail shot - ANSWERThe firm is responsible for its
representatives.
The general information about a firm that the Conduct of Business rules require to be
provided to the retail clients does not include:
Name, address and contact details
Details of the Financial Ombudsman Service
Details of the competent authority
EXAM COMPILATION CORRECT 100%
The FCA will notify an individual that they are subject to an investigation using which of
the following methods?
Letter to the individual's firm
Personal notice to the individual in writing
Telephone call
Personal notice to the individual by fax - ANSWERPersonal notice to the individual in
writing - durable medium
Where a communication by a firm contains an indication of the possible future
performance of a product, which of the following cannot be included?
The effects of commissions, fees or other charges.
The reasonable assumptions on which the performance is based.
A reference to the basis of the forecast being simulated past performance.
A warning that forecasts are not reliable indicators of future performance. -
ANSWERFuture performance estimates cannot be based on simulated past
performance.
Under the Terrorism Act 2000, when specifically should a suspicion of terrorist activities
be reported?
Without delay
Within 5 business days
By the next business day
As soon as reasonably practicable - ANSWERThe wording of the Terrorism Act is 'as
soon as reasonably practicable'.
When does the FCA publish details of a prohibition order?
After issuing a final notice
After issuing a warning
Once the FCA has notified the individual concerned and the firm
Once the FCA has notified the individual concerned - ANSWERFCA penalties are
effective once a final decision notice has been issued. Publication takes place at that
point.
After issuing a final notice
For how long must records relating to pension transfers be kept?
,Six years
Five years
Three years
Indefinitely - ANSWERIndefinitely (1 Mark)
Which of the following is not a 'disciplinary sanction'?
Financial penalty
Public censure
Statement of misconduct
Withdrawal of approval - ANSWERWithdrawal of approval will be used when an
individual is not fit and proper, and is a 'protective' or 'remedial' sanction.
Which of the following will constitute money laundering?
Ramping prices
Disseminating false rumours about a company
Passing on price sensitive information used for dealing
Entering into a number of transactions to hide the source of money - ANSWEROption
one and two are market abuse. Option three is insider dealing (or market abuse). Option
four is money laundering.
The main aim of the UK Investment Firms Prudential Regime (UK IFPR) is?
To focus the prudential requirements on the risks that the firm faces and considers
To focus the prudential requirements on the risks that the firm can pose to consumers
and markets
To focus the prudential requirements on the reputational risks that the firm may
To focus the prudential requirements on the risks that the firm presents to their
depositors - ANSWERTo focus the prudential requirements on the risks that the firm
can pose to consumers and markets
The approach under the IFPR is to consider the harm an FCA investment firm can
cause to others based on the activities that they carry out, and that the amount of
capital and liquid assets they hold is sufficient to undertake an orderly wind down.
Which of the following activities must be performed by an approved person?
Recruitment and training
Supervising other employees
Acting as a non-executive director
Working in compliance - ANSWERA non-executive director is a governing function and
so requires specific approval.
Which of the following is not part of the definition of terrorist activity in the Terrorism Act
2000?
, Action to intimidate the public.
Action to intimidate a government.
Action to advance a religious cause.
Action to advance a social cause. - ANSWERSocial cause. The rest are listed word for
word in the Act.
Which of the following per se professional clients cannot be an elective eligible
counterparty?
A supranational
The management group of a pension fund
A company with turnover of €50m and own funds of €5m
An institutional investor - ANSWERAn institutional investor cannot be an elective eligible
counterparty.
Following the UK's exit from the EU, Temporary Transitional Powers' (TTP) were
granted to UK branches of EU firms, or those looking to set up a branch in the UK until
31 March 2022. This enabled firms to prepare to be fully compliant with the UK regime
from 1 April 2022.
However, the regulator still expected those firms to be compliant with all of the following,
EXCEPT?
Market making exemption under the short selling rules
Securities Financing Transaction Regulation (SFTR) reporting
Commodity derivatives
Money laundering internal reporting procedures for suspicious transactions -
ANSWERMoney laundering internal reporting procedures for suspicious transactions.
Money laundering procedures for suspicious transaction reporting is covered under
different legislation, and is not part of the TTP.
Who is responsible for the approval of a mail shot sent by an appointed representative?
The FCA
The appointed representative
The firm
There is no requirement to approve a mail shot - ANSWERThe firm is responsible for its
representatives.
The general information about a firm that the Conduct of Business rules require to be
provided to the retail clients does not include:
Name, address and contact details
Details of the Financial Ombudsman Service
Details of the competent authority
