BCO troubled areas Questions with 100%
Correct Answers
What Regulation must an MFDA Dealer operating within a branch of FI comply with
MFDA Rules & Bylaws
Except in Quebec, All MF Dealers in Canada must be members of MFDA
TRUE
Where in Canada is there an explicit and absolute ban on making "unsolicited" or
"cold calls" to non-clients in an effort to sell securities. The legislation specifically
prohibits registered sales representatives from making unsolicited telephone calls or
personal visits to non-clients to solicit mutual fund trades. In Quebec, solicitation is
permitted but certain requirements must be met.
MANITOBA & NORTHWEST TERRITORIES
What is the primary legislation relating exclusively to the regulation of mutual funds in
Canada?
National Instrument 81-102 is the primary legislation relating to the regulation of mutual
funds in Canada
What course qualifies as a mutual fund proficiency course?
According to National Instrument 31-103 Registration Requirements and Exemptions and the
associated companion policy, individuals must successfully complete the examination (or
examinations) of one of the following approved mutual fund courses in order to qualify to
apply for registration as a dealing representative of a mutual fund dealer:
The Investment Funds in Canada Course, administered by CSI Global Education Inc.;
,The Canadian Securities Course, administered by CSI Global Education Inc., and;
The Canadian Investment Funds Course, administered by IFSE Institute.
or
The individual has earned a CFA Charter and has 12 months of relevant investment
management experience in the 36-month period before applying for registration.
or
The individual has received the Canadian Investment Manager designation and has 48
months of relevant investment management experience, 12 months of which was in the 36-
month period before applying for registration.
When to use NRD
NRD must be used for all applications, renewals and amendments to registrations with all
provincial and territorial securities regulators.
Judith is a mutual fund representative for a mutual fund dealer subsidiary of a
financial institution in Quebec. She has just been offered a similar job in New
Brunswick. What should be done to comply with the regulations?
If an employee is registered only in one province, his or her registration cannot be transferred
to another province. An application for registration with the dealer must be filed through the
NRD.
What are BCO duties for new sales rep
MFDA Policy No. 1 establishes supervision requirements for all new registered sales
representatives for a six-month period, commencing on the date of initial registration. During
the first 90-day period, all new accounts must be approved by the BCO prior to any trading
activity in the account, and all subsequent trading activity must be reviewed and signed off by
the BCO no later than one business day following the trade date.
, outside business activities
Sales representatives under your supervision should also obtain prior written permission from
you and/or the Regional Compliance Officer (RCO) and/or Head Office of the mutual fund
dealer, before:
Engaging in any business other than that of the mutual fund dealer.
Accepting employment or compensation from any person or organization other than the
mutual fund dealer.
Servicing as an officer, director or partner of a business organization.
Thus, the outside employment must be reported immediately to Head Office or the regional
Compliance Officer.
*Must be reported to RCO/Head Office if violations occur
when would you need to update NRD data base
A change to the sales representative's name or address, bankruptcy, or a criminal charge
would all require an update to the NRD database.
KYC
At a minimum, KYC information consists of five key aspects: (i) the client's financial and
personal circumstances, (ii) the client's investment knowledge, (iii) the client's risk tolerance,
(iv) the client's investment time frame or horizon, and (v) the client's investment objectives.
As BCO, you should refuse to open an account or process an order for a client who has not
completed all of the "KYC" information or who refuses to supply information that you
believe is pertinent to your obligations under MFDA Rule 2.2.1. Registered sales
representatives should also follow this rule.
As part of the KYC process, registered sales representatives must identify "politically
Correct Answers
What Regulation must an MFDA Dealer operating within a branch of FI comply with
MFDA Rules & Bylaws
Except in Quebec, All MF Dealers in Canada must be members of MFDA
TRUE
Where in Canada is there an explicit and absolute ban on making "unsolicited" or
"cold calls" to non-clients in an effort to sell securities. The legislation specifically
prohibits registered sales representatives from making unsolicited telephone calls or
personal visits to non-clients to solicit mutual fund trades. In Quebec, solicitation is
permitted but certain requirements must be met.
MANITOBA & NORTHWEST TERRITORIES
What is the primary legislation relating exclusively to the regulation of mutual funds in
Canada?
National Instrument 81-102 is the primary legislation relating to the regulation of mutual
funds in Canada
What course qualifies as a mutual fund proficiency course?
According to National Instrument 31-103 Registration Requirements and Exemptions and the
associated companion policy, individuals must successfully complete the examination (or
examinations) of one of the following approved mutual fund courses in order to qualify to
apply for registration as a dealing representative of a mutual fund dealer:
The Investment Funds in Canada Course, administered by CSI Global Education Inc.;
,The Canadian Securities Course, administered by CSI Global Education Inc., and;
The Canadian Investment Funds Course, administered by IFSE Institute.
or
The individual has earned a CFA Charter and has 12 months of relevant investment
management experience in the 36-month period before applying for registration.
or
The individual has received the Canadian Investment Manager designation and has 48
months of relevant investment management experience, 12 months of which was in the 36-
month period before applying for registration.
When to use NRD
NRD must be used for all applications, renewals and amendments to registrations with all
provincial and territorial securities regulators.
Judith is a mutual fund representative for a mutual fund dealer subsidiary of a
financial institution in Quebec. She has just been offered a similar job in New
Brunswick. What should be done to comply with the regulations?
If an employee is registered only in one province, his or her registration cannot be transferred
to another province. An application for registration with the dealer must be filed through the
NRD.
What are BCO duties for new sales rep
MFDA Policy No. 1 establishes supervision requirements for all new registered sales
representatives for a six-month period, commencing on the date of initial registration. During
the first 90-day period, all new accounts must be approved by the BCO prior to any trading
activity in the account, and all subsequent trading activity must be reviewed and signed off by
the BCO no later than one business day following the trade date.
, outside business activities
Sales representatives under your supervision should also obtain prior written permission from
you and/or the Regional Compliance Officer (RCO) and/or Head Office of the mutual fund
dealer, before:
Engaging in any business other than that of the mutual fund dealer.
Accepting employment or compensation from any person or organization other than the
mutual fund dealer.
Servicing as an officer, director or partner of a business organization.
Thus, the outside employment must be reported immediately to Head Office or the regional
Compliance Officer.
*Must be reported to RCO/Head Office if violations occur
when would you need to update NRD data base
A change to the sales representative's name or address, bankruptcy, or a criminal charge
would all require an update to the NRD database.
KYC
At a minimum, KYC information consists of five key aspects: (i) the client's financial and
personal circumstances, (ii) the client's investment knowledge, (iii) the client's risk tolerance,
(iv) the client's investment time frame or horizon, and (v) the client's investment objectives.
As BCO, you should refuse to open an account or process an order for a client who has not
completed all of the "KYC" information or who refuses to supply information that you
believe is pertinent to your obligations under MFDA Rule 2.2.1. Registered sales
representatives should also follow this rule.
As part of the KYC process, registered sales representatives must identify "politically
