CII R01 EVALUATION TEST UPDATED QUESTIONS AND
ANSWERS GRADED A+
✔✔If an employee reports that a colleague is failing to comply with the law, what must
the employer do? - ✔✔Protect the informer (whistleblower)
✔✔What is the prescribed wording needed for an appointed representative to disclose
their status? - ✔✔(Name of AR) is an appointed representative of (firm) which is
authorised and regulated by the Financial Conduct Authority
✔✔How is the Financial Conduct Authority funded? - ✔✔Through levies on the financial
services industry
✔✔Apart from the periodic, application and special project fees, what other fees are due
from authorised firms? - ✔✔Financial Ombudsman Service, Financial Services
Compensation Scheme and Money and Pensions Service fees
✔✔Regulated larger firms must maintain resources to cover risks and must carry out
risk assessment and stress testing scenarios as required by the: - ✔✔Capital
Requirements Directive
✔✔Rachel's firm's professional indemnity insurance requirements are set out in
MIPRU? This means that she must work for a: - ✔✔home finance firm
✔✔Which EU led requirements were incorporated into COBS? - ✔✔MIFID
✔✔If a provider gives any benefits or inducements to an intermediary how long must
they keep records for? - ✔✔5 years
✔✔How does the Insurance Conduct of Business Sourcebook (ICOBS) categorise
insurance products? - ✔✔General insurance, pure protection and payment protection
insurance
✔✔Under ICOBS rules, who is responsible for ensuring an intermediary is authorised to
deal with an insurer? - ✔✔An insurer must ensure that any intermediary it deals with is
authorised
✔✔What products comes under the ICOBS product category of pure protection? -
✔✔Term assurance and Critical Illness cover
✔✔If a firm passes mortgage leads to an authorised person for a fee, does that firm
require FCA authorisation? - ✔✔No authorisation is required as the introducer is not
advising the client
, ✔✔What mortgage contracts are regulated? - ✔✔Where 40% of the property will be
used by the borrower, and the loan is secured by a legal first or second charge
mortgage
✔✔How do the MCOB rules ensure there is uniformity in the market as to the meaning
of various terms e.g. the higher lending charge? - ✔✔Standard terms and meanings
must be used in client communications
✔✔How does the Sale and Rent back regime introduced in 2010 help to protect
customers? - ✔✔By ensuring tenancy agreements are fixed for at least 5 years
✔✔Why has the FCA devised rules regarding client assets and client money? - ✔✔To
minimise the risk of clients' money being used by the firm without agreement
✔✔What group is specifically exempt from the Consumer Credit Act 1974? -
✔✔Building societies
✔✔Under what circumstances must the FCA notify a person who is subject to an
investigation? - ✔✔Falsely describing themselves as authorised
✔✔Within the ninth block of the FCA handbook, what does The Perimeter Guidance
Manual (PERG) cover? - ✔✔Guidance on when authorisation is required or exempt
person status is available
✔✔What is the purpose of the cooling-off period under consumer credit legislation? -
✔✔To allow the borrower sufficient time to change their mind and withdraw from a loan
agreement if required
✔✔What does the 'general prohibition' rule within s.19 of the FSMA refer to? - ✔✔It is
an offence for someone to carry out a regulated activity unless the person is authorised
or exempt
✔✔What is required in order for a firm to qualify for exempt status? - ✔✔It must be
contracted to an authorised person responsible for their activities
✔✔Within a SM&CR financial services firm, to whom do the Conduct rules (COCON)
apply? - ✔✔Nearly all staff, apart from ancillary staff
✔✔What does Part 4A permission as set out by the FSMA refer to? - ✔✔Applying to the
FCA for direct authorisation to allow the firm to carry out the regulated activities they
have applied for
ANSWERS GRADED A+
✔✔If an employee reports that a colleague is failing to comply with the law, what must
the employer do? - ✔✔Protect the informer (whistleblower)
✔✔What is the prescribed wording needed for an appointed representative to disclose
their status? - ✔✔(Name of AR) is an appointed representative of (firm) which is
authorised and regulated by the Financial Conduct Authority
✔✔How is the Financial Conduct Authority funded? - ✔✔Through levies on the financial
services industry
✔✔Apart from the periodic, application and special project fees, what other fees are due
from authorised firms? - ✔✔Financial Ombudsman Service, Financial Services
Compensation Scheme and Money and Pensions Service fees
✔✔Regulated larger firms must maintain resources to cover risks and must carry out
risk assessment and stress testing scenarios as required by the: - ✔✔Capital
Requirements Directive
✔✔Rachel's firm's professional indemnity insurance requirements are set out in
MIPRU? This means that she must work for a: - ✔✔home finance firm
✔✔Which EU led requirements were incorporated into COBS? - ✔✔MIFID
✔✔If a provider gives any benefits or inducements to an intermediary how long must
they keep records for? - ✔✔5 years
✔✔How does the Insurance Conduct of Business Sourcebook (ICOBS) categorise
insurance products? - ✔✔General insurance, pure protection and payment protection
insurance
✔✔Under ICOBS rules, who is responsible for ensuring an intermediary is authorised to
deal with an insurer? - ✔✔An insurer must ensure that any intermediary it deals with is
authorised
✔✔What products comes under the ICOBS product category of pure protection? -
✔✔Term assurance and Critical Illness cover
✔✔If a firm passes mortgage leads to an authorised person for a fee, does that firm
require FCA authorisation? - ✔✔No authorisation is required as the introducer is not
advising the client
, ✔✔What mortgage contracts are regulated? - ✔✔Where 40% of the property will be
used by the borrower, and the loan is secured by a legal first or second charge
mortgage
✔✔How do the MCOB rules ensure there is uniformity in the market as to the meaning
of various terms e.g. the higher lending charge? - ✔✔Standard terms and meanings
must be used in client communications
✔✔How does the Sale and Rent back regime introduced in 2010 help to protect
customers? - ✔✔By ensuring tenancy agreements are fixed for at least 5 years
✔✔Why has the FCA devised rules regarding client assets and client money? - ✔✔To
minimise the risk of clients' money being used by the firm without agreement
✔✔What group is specifically exempt from the Consumer Credit Act 1974? -
✔✔Building societies
✔✔Under what circumstances must the FCA notify a person who is subject to an
investigation? - ✔✔Falsely describing themselves as authorised
✔✔Within the ninth block of the FCA handbook, what does The Perimeter Guidance
Manual (PERG) cover? - ✔✔Guidance on when authorisation is required or exempt
person status is available
✔✔What is the purpose of the cooling-off period under consumer credit legislation? -
✔✔To allow the borrower sufficient time to change their mind and withdraw from a loan
agreement if required
✔✔What does the 'general prohibition' rule within s.19 of the FSMA refer to? - ✔✔It is
an offence for someone to carry out a regulated activity unless the person is authorised
or exempt
✔✔What is required in order for a firm to qualify for exempt status? - ✔✔It must be
contracted to an authorised person responsible for their activities
✔✔Within a SM&CR financial services firm, to whom do the Conduct rules (COCON)
apply? - ✔✔Nearly all staff, apart from ancillary staff
✔✔What does Part 4A permission as set out by the FSMA refer to? - ✔✔Applying to the
FCA for direct authorisation to allow the firm to carry out the regulated activities they
have applied for
