BCO Exam Questions with 100% Correct
Answers
Branch Compliance Officer (BCO)
The person responsible for ensuring compliance with the regulatory requirements within the
branch by monitoring the conduct of the mutual fund salespeople.
wilful blindness
A deliberate closing of one's mind to the possible consequences of one's actions
fintrac
Financial Transactions and Reports Analysis Centre of Canada
wilful blindness penalty
2million/5yrs in prison
money laundering penalty
10yrs or more in prison
cross border reporting
in Canada there are no restrictions only that if import or export is over 10k it must be reported
OFSI superintendant of financial institutions
does NOT have a legislated role with respect to Proceeds of crime(money laundering )
terrorist financing- but "supervision" oversees policies practices and procedures in place ex
strict KYC rules. shares info with FINTRAC
ofsi assessments cover 3 key areas
,1)whether the institution has implemented the requisite policies and procedures to be in
compliance with the ACT
2)whether it has the requisite framework of controls in place to report designated transactions
to fintrac 30 whether the quality of those controls and the supporting risk management
processes are adequate
terrorist financing reporting obligations(CSA STAFF NOTICE 31-352)
Describes the terrorist financing reporting obligations for registrants
CSA STAFF NOTICE 31-152
reporting by 14th of every month to the regulator, monthly to IIROC,
what is the process if a client is identified as designated person in terms of terrorist
financing
freeze property and report to RCMP&CSIS and terrorist property report may be required by
FINTRAC
also IRROC MEMBERS use the UN reporting system(found on IIROC website/used by
IIROC dealer members only) report must be submitted no later than the 15th day of each
calendar month( unless its a sat or sun then the next business day)
other FIs that are IIROC members use reporting issued by province or appropriate SRO
MOU (memorandum of understanding)
An agreement (bilateral or multilateral) between parties defining terms and conditions of an
agreement.
ex FINTRAC AND IIROC have MOU when it comes to AML&Terrorist financing
right of withdrawal
,within 2 days after fund facts received
client entitled to return of origional purchase price, any front end load fees and there would
be no penalties ex dsc fees. handled by head office legal or compliance department
right of recission (if fundfacts,annual statement, prospectus,ammendments)
in cases of misrepresentation- to be handled by head office legal, compliance department and
follow mutual fund dealers written procedures
standard of conduct
highest standards of service and ethical conduct. A fair and even approach to all disputes.
1)KYC- financial & personal circumstances,investment knowledge, risk, investment
timeframe, investment objectives
2)suitablility &acceptability(solicited or unsolicited)
3)provide appropriate cautions- suitable & reasonable
4)integrety of info/assets
5)accuracy & completeness
6)confidentiality
7)no outside deals ex you give personal business loans to a new startup
8)responsible behaviour(ex you cant say I bought 20K of nasdaq because its my favourite
fund)
9) avoid insider trading
avoid conflicts of interest
10) no discretionary trading
conflicts of interest- ex)outside business activities
follow dealers policy & procedures
, limited trading authority
phone fax agreement-allows you to accept requests
Conflict of interest (CFR REFORM NI31-103)
1) material conflicts
2)disclosure of conflict must be prominent specific written in plain language
3)nature and extent of conflict
impact & risk to client
the way in which it has been or will be addressed
Telemarketing & DNCL rules(do not apply to Business clients or servicing calls, or
people who filled out forms to be contacted at a trade show)
selling or promoting a product or service. If clients have existing products
penalties for each violation 1500 for individuals & 15000 for corporations (determined by
nature of violation, minor serious, very serious,negligent, intentional) # of
frequencies/complaints, potential of future violations
solicitation
selling or promoting a product or service
provincial and territorial securities commissions
are the regulatory bodies responsible for admin of securities legislation in their respective
provinces & territories
AMF (autorite des marches financiers)
regulate Mutual funds dealers & reps
Answers
Branch Compliance Officer (BCO)
The person responsible for ensuring compliance with the regulatory requirements within the
branch by monitoring the conduct of the mutual fund salespeople.
wilful blindness
A deliberate closing of one's mind to the possible consequences of one's actions
fintrac
Financial Transactions and Reports Analysis Centre of Canada
wilful blindness penalty
2million/5yrs in prison
money laundering penalty
10yrs or more in prison
cross border reporting
in Canada there are no restrictions only that if import or export is over 10k it must be reported
OFSI superintendant of financial institutions
does NOT have a legislated role with respect to Proceeds of crime(money laundering )
terrorist financing- but "supervision" oversees policies practices and procedures in place ex
strict KYC rules. shares info with FINTRAC
ofsi assessments cover 3 key areas
,1)whether the institution has implemented the requisite policies and procedures to be in
compliance with the ACT
2)whether it has the requisite framework of controls in place to report designated transactions
to fintrac 30 whether the quality of those controls and the supporting risk management
processes are adequate
terrorist financing reporting obligations(CSA STAFF NOTICE 31-352)
Describes the terrorist financing reporting obligations for registrants
CSA STAFF NOTICE 31-152
reporting by 14th of every month to the regulator, monthly to IIROC,
what is the process if a client is identified as designated person in terms of terrorist
financing
freeze property and report to RCMP&CSIS and terrorist property report may be required by
FINTRAC
also IRROC MEMBERS use the UN reporting system(found on IIROC website/used by
IIROC dealer members only) report must be submitted no later than the 15th day of each
calendar month( unless its a sat or sun then the next business day)
other FIs that are IIROC members use reporting issued by province or appropriate SRO
MOU (memorandum of understanding)
An agreement (bilateral or multilateral) between parties defining terms and conditions of an
agreement.
ex FINTRAC AND IIROC have MOU when it comes to AML&Terrorist financing
right of withdrawal
,within 2 days after fund facts received
client entitled to return of origional purchase price, any front end load fees and there would
be no penalties ex dsc fees. handled by head office legal or compliance department
right of recission (if fundfacts,annual statement, prospectus,ammendments)
in cases of misrepresentation- to be handled by head office legal, compliance department and
follow mutual fund dealers written procedures
standard of conduct
highest standards of service and ethical conduct. A fair and even approach to all disputes.
1)KYC- financial & personal circumstances,investment knowledge, risk, investment
timeframe, investment objectives
2)suitablility &acceptability(solicited or unsolicited)
3)provide appropriate cautions- suitable & reasonable
4)integrety of info/assets
5)accuracy & completeness
6)confidentiality
7)no outside deals ex you give personal business loans to a new startup
8)responsible behaviour(ex you cant say I bought 20K of nasdaq because its my favourite
fund)
9) avoid insider trading
avoid conflicts of interest
10) no discretionary trading
conflicts of interest- ex)outside business activities
follow dealers policy & procedures
, limited trading authority
phone fax agreement-allows you to accept requests
Conflict of interest (CFR REFORM NI31-103)
1) material conflicts
2)disclosure of conflict must be prominent specific written in plain language
3)nature and extent of conflict
impact & risk to client
the way in which it has been or will be addressed
Telemarketing & DNCL rules(do not apply to Business clients or servicing calls, or
people who filled out forms to be contacted at a trade show)
selling or promoting a product or service. If clients have existing products
penalties for each violation 1500 for individuals & 15000 for corporations (determined by
nature of violation, minor serious, very serious,negligent, intentional) # of
frequencies/complaints, potential of future violations
solicitation
selling or promoting a product or service
provincial and territorial securities commissions
are the regulatory bodies responsible for admin of securities legislation in their respective
provinces & territories
AMF (autorite des marches financiers)
regulate Mutual funds dealers & reps
