Tony's job description should describe the following duties with regard to

his role as Compliance Officer:

a.
Monitoring and overseeing the compliance function.

b.
Monitoring and providing support.

c.
Providing support and training.

d.
Monitoring and overseeing the compliance function and providing
support by establishing and maintaining compliance procedures for the
FSP.
Feedback
Your answer is correct.
Section 17 of the FAIS Act sets out the duties of an FSP in relation to
Compliance Officers and compliance arrangements.
The correct answer is: Monitoring and overseeing the compliance function
and providing support by establishing and maintaining compliance
procedures for the FSP.

Question 2
Correct
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If you had to explain the difference between the suspension of a licence
and the lapsing of a licence, you could say the following:
Question 2Select one:

a.
Suspension or withdrawal of a licence is the result of factors other than
non-compliance with the requirements of the FAIS Act. Lapsing of a
licence may be the result of a person's death.

b.
Suspension or withdrawal of a licence is the result of non-compliance with
the requirements of the FAIS Act. Lapsing of a licence is the result of
factors other than non-compliance.
c.
Suspension or withdrawal of a licence is the result of non-compliance with
the requirements of the FAIS Act. Lapsing of a licence is the result of a
person not meeting the Fit and Proper Competency requirement.

d.
Suspension or withdrawal of a licence is the result of one's resignation
from the services of an FSP. Lapsing of a licence is the result of factors
other than non-compliance.
Feedback
Your answer is correct.
Refer to Sections 9 'Suspension and Withdrawal of Authorisation' and 11
'Lapsing of Licence' of the FAIS act for the difference between the
suspension and lapsing of a licence.
The correct answer is: Suspension or withdrawal of a licence is the result
of non-compliance with the requirements of the FAIS Act. Lapsing of a
licence is the result of factors other than non-compliance.

Question 3
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Sequestration, winding-up or closure of an FSP will become effective and
legal under the following condition(s):
Question 3Select one:

a.
The FSP must lodge the necessary documentation with the Authority.

b.
The FSP must get the 'approval' of the Authority.

c.
The court must agree to adequate distribution of assets.

d.
a and b.

e.
a and c.
 Feedback
Your answer is incorrect.
Section 38 of the FAIS Act states that voluntary sequestration, winding- up
or closure of an FSP business will not have legal force unless a copy or
notice has been lodged with the Authority, and the Authority has informed
the FSP or Representative that the arrangements are satisfactory to the
Authority.
The correct answer is: a and b.

Question 4
Correct
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Select the CORRECT answer. Customer due diligence in terms of the FIC
Act refers to:
i. What the accountable institution knows about the client.
ii. What the accountable institution understands about the business
the client is conducting.
iii. What the accountable institution understands about the type of
transactions it can expect in the course of the business relationship.
Question 4Select one:

a.
i and ii only.

b.
i and iii only.

c.
ii and iii only.

d.
i, ii, and iii.
Feedback
Your answer is correct.
In terms of Section 21A of the FIC Act as amended, the accountable
institution must obtain information about the client regarding:
(a) the nature of the business relationship concerned;
(b) the intended purpose of the business relationship concerned; and
(c) the source of the funds which that prospective client expects to use in
concluding transactions in the course of the business relationship
concerned.

The correct answer is: i, ii, and iii.

Question 5
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When a person does not submit a return, information or document to the
Authority as required by the FAIS Act, that person is liable to additional
legal action. Which penalty will apply to an FSP if they do not comply with
the FAIS requirement to submit annual financial statements to the
Authority?
Question 5Select one:

a.
To pay a fine of up to R1 000.00 (or as determined by the Authority) per
day for every day that the return, information or document is late.

b.
To pay a fine of up to R1 000.00 (or as determined by the Authority) per
day for every day that the return, information or document is late, plus
interest.

c.
To pay a fine of R1 000.00 (or as determined by the Authority) per day
for every day that the return, information or document is late, plus
interest.

d.
None of the options listed.
Feedback
Your answer is incorrect.
Section 41(2)(a) of the FAIS Act states that a person who fails to submit
such information or return within the prescribed period to the Authority is
liable to a penalty not exceeding R1 000.00, or any greater amount
prescribed, for every day during which the failure continues. Section 3(a)
prescribes that interest is payable if the penalty is not paid by the due
date.
The correct answer is: To pay a fine of up to R1 000.00 (or as determined
by the Authority) per day for every day that the return, information or
document is late, plus interest.

Question 6
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Where the Authority has withdrawn the licence of an FSP, the
consequences for the FSP are:
i. The FSP is suspended from providing financial services for a period of
time.
ii. The FSP is debarred from applying for a new licence for a period of
time.
iii. The FSP is provisionally suspended from providing financial services
until the conditions relating to the suspension have been met.
iv. A withdrawn licence cannot be reinstated by the Authority.
Question 6Select one:

a.
i and ii only.

b.
ii and iii only.

c.
ii and iv only.

d.
iii and iv only.
Feedback
Your answer is incorrect.
In terms of Section 9(5) and 9(6)(a) of the FAIS Act, during any period of
suspension, the licensee concerned is for the purposes of this Act
regarded as not being authorised to act as a financial services provider
and is debarred from applying for a new license for a period specified by
the Authority.
The correct answer is: i and ii only.

Question 7
Incorrect
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In terms of the FAIS General Code of Conduct, an advertisement must not
be constructed in such a way as to lead a client to any false conclusions
the client might reasonably rely upon. Therefore, when an FSP constructs
an advertisement, it must consider the following:
i. The conclusion likely to be made by clients that are subject to the
advertisement.
ii. The literal meaning of the words.
iii. The impressions from nonverbal portions of the advertisement.
iv. The materials and descriptions omitted from the advertisement.
Question 7Answer

a.
i and ii only.

b.
iii and iv only.

c.
ii, iii and iv only.

d.
i, ii, iii and iv.
Feedback
Your answer is incorrect.
Refer to Section 14 of the FAIS General Code of Conduct. This section
sets out the requirements of advertising that an FSP must adhere to,
which encompasses all the options given.
The correct answer is:
i, ii, iii and iv.

Question 8
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As a Representative for Safe Insurance you need to ensure that the
following requirements are met with regard to the confidentiality of client
information:
i. An FSP may not disclose any confidential information acquired or
obtained from a client unless the client consented in writing after the
disclosure.
ii. An FSP may not disclose any confidential information acquired or
obtained from a client unless the client consented in writing beforehand.
iii. An FSP may not disclose any confidential information acquired or
obtained from a client unless disclosure of the information is required in
the Authority’s interest.
iv. An FSP may not disclose any confidential information acquired or
obtained from a client unless disclosure is required in terms of any law.
Question 8Select one:

a.
i and iv only.

b.
ii and iii only.

c.
ii and iv only.

d.
i and ii only.
Feedback
Your answer is correct.
In terms of Section 3(3) of the General Code of Conduct, a provider may
not disclose any confidential information acquired or obtained from a
client or, subject to Section 4(1), a product supplier in regard to such
client or supplier, unless the written consent of the client or product
supplier, as the case may be, has been obtained beforehand or disclosure
of the information is required in the public interest or under any law.
The correct answer is: ii and iv only.

Question 9
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The requirement for recordkeeping set by FAIS prescribes that:
Question 9Select one:

a.
The insurer must store all records on its premises.

b.
The insurer must store records off-site only with special permission.

c.
The insurer must store records in an appropriate facility which cannot be
destroyed.

d.
The insurer must store records in electronic format only with special
permission.
Feedback
Your answer is correct.
Section 3(2)(a)(iii) of the General Code of Conduct provides that a
financial service provider must keep client records and documentation
safe from destruction. Furthermore, according to section 37(2)(b)(iii) and
(iv) of Board Notice 194 of 2017, systems and procedures to store data
must be safe, backed up, secure, accurate and complete.
The correct answer is: The insurer must store records in an appropriate
facility which cannot be destroyed.

Question 10
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Which one of the following is NOT an accountable institution?
Question 10Select one:

a.
A legal practitioner.

b.
A long-term insurance company.

c.
A person who carries on a life insurance business.
d.
A training organisation in the insurance industry.
Feedback
Your answer is incorrect.
Schedule 1 of the FIC Act lists accountable institutions. Schedule 1 was
amended in 2022, adding additional entries and businesses to the list of
accountable institutions, removing several and changing the categories
under which some accountable institutions fall. For example, The Ithala
Development Finance Corporation Limited was removed but included
under credit providers. Another addition was high-value goods dealers,
which include a multitude of businesses with the only requirement that
the business sells products valued at R100 000 or more.
The correct answer is: A training organisation in the insurance industry.

Question 11
Incorrect
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Which one of the following is NOT an accountable institution?
Question 11Select one:

a.
A legal practitioner.

b.
A long-term insurance company.

c.
A person who carries on a life insurance business.

d.
A training organisation in the insurance industry.
Feedback
Your answer is incorrect.
Schedule 1 of the FIC Act lists accountable institutions. Schedule 1 was
amended in 2022, adding additional entries and businesses to the list of
accountable institutions, removing several and changing the categories
under which some accountable institutions fall. For example, The Ithala
Development Finance Corporation Limited was removed but included
under credit providers. Another addition was high-value goods dealers,
which include a multitude of businesses with the only requirement that
the business sells products valued at R100 000 or more.
The correct answer is: A training organisation in the insurance industry.

Question 12
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Part of the Fit and Proper requirements determined by the FAIS Act are
that a Representative must meet the Honesty, Integrity and Good
Standing requirements. InsCo, which is an insurance company, would like
to appoint a couple of Representatives. Richard and Sharon are potential
candidates.
Choose one statement, that confirms the candidates meet the
requirements for Honesty, Integrity and Good Standing.
Question 12Select one:

a.
Sharon worked for a large brokerage with an FSP licence as a director.
She tells you that she left them because their FSP licence was suspended
because the Key Individual committed fraud.

b.
Richard is appointed as a Representative by his current employer, and he
has been rendering financial services in various subcategories of Category
I products for the past two years.

c.
Sharon is a Category IIA Representative and she has two years' practical
experience in rendering financial services and has been disciplined in
relation to business conduct.

d.
Sharon has a qualification that is on the FSCA qualification list, and she
has been uncooperative in dealing with the Authority.
Feedback
Your answer is correct.
According to Section 9 of Board Notice 194 of 2017, incidents indicating
when persons are not honest or lack integrity or good standing:
(1) Without limiting the generality of Section 8(1), any of the following
constitutes prima facie evidence that a person does not
qualify in terms of Section 8(1). The person:
(a) has been found guilty (and that conviction has not been expunged) in
any criminal proceedings or liable in any civil proceedings by a court
under any law in any jurisdiction of:
(i) an offence under a law relating to the regulation or supervision of a
financial institution as defined in the Financial Institutions (Protection of
Funds) Act, 2001 (Act No. 28 of 2001) or a corresponding offence under
the law of a foreign country;
(ii) theft, fraud, forgery, uttering a forged document, perjury or an
offence involving dishonesty, breach of fiduciary duty, dishonourable or
unprofessional conduct; or
(iii) an offence under the Prevention of Corruption Act, 1958 (Act No. 6 of
1958), the Corruption Act, 1992 (Act No. 94 of 1992) or Parts 1 to 4, or
Section 17, 20 or 21 of the Prevention and Combating of Corrupt
Activities Act, 2004 (Act No. 12 of 2004), or a corresponding offence
under the law of a foreign country;
(b) has been convicted (and that conviction has not been expunged) of
any other offence committed after the Constitution of the Republic of
South Africa, 1996, took effect, where the penalty imposed for the offence
was or may be imprisonment without the option of a fine, or a significant
fine;
(c) has accepted civil liability for, or has been the subject of a civil
judgment in respect of, theft, fraud, forgery, uttering a forged document,
perjury or any conduct involving dishonesty, breach of fiduciary duty,
misrepresentation, or negligent, dishonourable and unprofessional
conduct;
(d) has been the subject of frequent or material preventative, remedial or
enforcement actions by the Registrar or regulatory authority;
(e) has been removed from an office of trust for theft, fraud, forgery,
uttering a forged document, misrepresentation, dishonesty, breach of
fiduciary duty or business conduct;
(f) has breached a fiduciary duty;
(g) has been suspended, dismissed or disqualified from acting as a
director, managing executive, public officer, auditor or statutory actuary
(or their alternate) under any law or any action to achieve one of the
aforementioned outcomes has been instituted against the person;
(h) has been refused registration, approval, authorisation or licence to
carry out a trade, business or profession, or has had that registration,
approval, authorisation or licence suspended, revoked, withdrawn or
terminated by a regulatory authority;
(i) has been denied registration or membership of any professional body
or has had that registration or membership revoked, withdrawn or
terminated by a professional body because of matters relating to honesty,
integrity, or business conduct;
(j) has been disciplined, reprimanded, disqualified, or removed in relation
to matters relating to honesty, integrity, incompetence or business
conduct by a:
(i) professional body; or
(ii) regulatory authority or any action to achieve one of the
aforementioned outcomes has been instituted against the person;
(k) has knowingly been untruthful or provided false or misleading
information to, or been uncooperative in any dealings with, the Registrar
or regulatory authority;
(l) has demonstrated a lack of readiness and willingness to comply with
legal, regulatory or professional requirements and standards;
(m) has been found to be not fit and proper by the Registrar or a
regulatory authority in any previous assessments of fitness and propriety
and the reasons for being found not fit and proper have not been
remedied;
(n) has been involved or is involved as a director, trustee, member,
partner, controlling shareholder or managing executive, or is concerned in
the management, of a business that has been:
(i) the subject of any matter referred to in subparagraphs (a), (b), (c), (d),
(f), (h), (j) (ii), (k), (l), (m), or (o); or
(ii) placed in liquidation or business rescue, while that person has been
connected with that organisation or within one year of that connection;
or
(o) has failed to disclose information required to be disclosed in terms of
the Act, including a failure to disclose information in accordance with
Section 10.
(2) Without limiting subsection (1), compliance with Section 8(1) by a
person that is not a natural person must be demonstrated through its
corporate behaviour or conduct and through the personal behaviour or
conduct of the persons who control or govern that first-mentioned person
or who is a member of a body or group of persons which control or
govern that person, including directors, members, trustees, partners or
Key Individuals of that person.
(3) Notwithstanding subsection (1), the Registrar must, in assessing
whether a person meets the requirements in Section 8(1) have due
regard to:
(a) the seriousness of a person’s conduct, whether by commission or
omission, or behaviour and surrounding circumstances to that conduct or
behaviour that has or could potentially have a negative impact on a
person’s compliance with Section 8 (1);
(b) the relevance of such conduct or behaviour that has or could
potentially have a negative impact on the person's compliance
with Section 8(1), to the duties that are or are to be performed and
the responsibilities that are or are to be assumed by that person;
and
(c) the passage of time since the occurrence of the conduct or behaviour
that had a negative impact on the person’s compliance with Section 8 (1).
The correct answer is: Richard is appointed as a Representative by his
current employer, and he has been rendering financial services in various
subcategories of Category I products for the past two years.
Question 13
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Which one of the following tasks forms part of the oversight function of
the Compliance Officer?
Question 13Select one:

a.
Monitoring Representatives' behaviour.

b.
Implementing advice processes.

c.
Liaising with the Authority.

d.
Identification of training needs.
Feedback
Your answer is incorrect.
Section 17(1)(a) of the FAIS Act sets out the duties of an FSP in relation to
Compliance Officers and compliance arrangements.
According to Section 17(1)(a) of the FAIS Act any authorised financial
services provider with more than one Key Individual or one or more
Representatives must, subject to Section 35(1)(c) and subsections (1)(b)
and (2)(a)(i), appoint one or more Compliance Officers to oversee the
provider's compliance function and to monitor compliance with this Act by
the provider and such Representative or Representatives, particularly in
accordance with the procedures contemplated in subsection (3), and to
take responsibility for liaison with the Registrar.
The correct answer is: Liaising with the Authority.

Question 14
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Which of the following is TRUE?
i. Section 7 of the FAIS Act includes the qualification of Representatives
and duties of the FSPs towards the maintenance of the FAIS licence.
ii. FSPs may only have one licence.
iii. The licensing conditions will never include exemptions applicable to
the FSP.
iv. The financial services of the FSP are limited to the specific sub-product
category for which a licence is issued.
Question 14Select one:

a.
i and iv.

b.
ii and iii.

c.
i and ii.

d.
iv only.
Feedback
Your answer is incorrect.
Section 8(4)(iv) of the FAIS Act confirms that where an application for a
licence has been granted, the Authority may impose such conditions and
restrictions on the FSP including regarding the category or subcategory of
financial products in respect of which the applicant could appropriately
render financial services.
The correct answer is: iv only.

Question 15
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 Question text
The Register kept by the FSP relating to Representatives must indicate
the capacity in which the Representative acts for the FSP because the
Representative may:
Question 15Select one:

a.
Not be an employee but may be an independent contractor.

b.
Not be an employee but may be a mandatary.

c.
Not be an employee but an independent broker.

d.
Be either a mandatary or an employee.
Feedback
Your answer is correct.
In terms of Section 13(4), such a register must contain every
Representative’s or Key Individual’s name and business address, and
state whether the Representative acts for the provider as employee or as
mandatory.
The correct answer is: Be either a mandatary or an employee

Question 16
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The FAIS General Code of Conduct requires that FSPs and their
Representatives act honestly and fairly.
This means that they must:
Question 16Select one:

a.
Provide a complete list of all the features, benefits, costs, uses and pitfalls
of a financial product or service being considered.

b.
Disclose all information that may affect the customer's decision to
purchase or use a financial product or service.

c.
Take care not to overload the customer with information and details about
the financial product or service being considered.

d.
Provide access to resources and services the customer may require to
access his financial product or service without limitations.
Feedback
Your answer is correct.
Section 2 of the FAIS General Code of Conduct requires that a provider
must at all times render financial services honestly, fairly, with due skill,
care and diligence, and in the interests of clients and the integrity of the
financial services industry.
The correct answer is: Disclose all information that may affect the
customer's decision to purchase or use a financial product or service.

Question 17
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Blake, a financial advisor for Finitec, recommends that his long-standing
client replace his existing motor vehicle insurance policy held with Keen
Insurance (originally sold by Blake to the client), with a similar policy
offered by Finitec Life. Blake is required to provide certain information to
the client when recommending the replacement of a product.
Which of the following options are correct?
i. Blake must provide a comparison of fees and charges between the
terminated product and the replacement product.
ii. Blake must provide a comparison of special terms and conditions,
exclusions of liability, waiting periods, loadings, penalties and excesses
between the terminated product and the replacement product.
iii. Blake must provide reasons why the replacement product is considered
to be more suitable to the client's needs than keeping or modifying the
terminated product.
iv. Blake is not required to provide any of the information listed in these
options as he sold the original product to the client with a full product and
fee explanation.
Question 17Select one:
a.
i, ii, iii and iv.

b.
iv only.

c.
i, ii and iv only.

d.
i, ii and iii only.
Feedback
Your answer is correct.
Section 8(1)(d) and 9(1)(d) of the General Code of Conduct explains that
where the replacement product is to replace an existing financial product,
the client must be provided, among other things, with full details of fees
and charges of the new (replacement) product compared with the existing
product and a comparison of the special terms and conditions, exclusions
of liability, waiting periods, loadings, penalties, excesses, restrictions or
circumstances where the benefits will not be provided and this must be
included in the record of advice. Section 9(1)(d)(bb) further requires that
the reasons why the replacement product was considered more suitable
to the client’s needs than retaining or modifying the terminated product,
must be included in the record of advice.
The correct answer is: i, ii and iii only.

Question 18
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The purpose of disclosures is to:
Question 18Select one:

a.
Enable the client to make an informed decision.

b.
Enable the insurer to evaluate the risk.

c.
Be used as an agenda for a discussion with the client.

d.
Inform the Representative of the attitude of the client towards the
recommended product.
Feedback
Your answer is correct.
Disclosure is one of the key protection objectives of the FAIS Act. Clients
must be able to make informed decisions and choices and must therefore
receive all the relevant information. Further, section 8(2) of the General
Code of Conduct states that, 'The provider must take reasonable steps to
ensure that the client understands the advice and that the client is in a
position to make an informed decision.'
The correct answer is: Enable the client to make an informed decision.

Question 19
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In terms of the FAIS General Code of Conduct, descriptions of an
advertisement must not:
i. Give benefits or returns undue prominence compared with risks
ii. Disclose the source and date of any statistics referred to.
iii. Exaggerate benefits or returns.
iv. Create expectations regarding financial product or financial service
performance or the performance of related services that the FSP does not
reasonably expect to achieve.

Question 19Answer

a.
i, ii and iii only.

b.
i, iii and iv only.

c.
ii and iii only.

d.
None of the above.
 Feedback
Your answer is correct.
Refer to Section 14 of the FAIS General Code of Conduct. Disclosing the
source and date of any statistics referred to in advertisements is not
referred to as a requirement.
The correct answer is: i, iii and iv only.

Question 20
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Once an FSP has debarred a Representative, the FSP has to take steps to
ensure that:
Question 20Select one:

a.
Unconcluded business of the debarred Representative is cancelled.

b.
Clients of the debarred Representative are informed that no further
financial services could be rendered to them.

c.
Clients of the debarred Representative are not disadvantaged and that
any unconcluded business is properly concluded.

d.
All records of the debarred Representative's clients are destroyed.
Feedback
Your answer is correct.
In terms of Section 14 (4)(c) of the FAIS Act, where the debarment has
been effected as contemplated in subsection (1), the financial services
provider must:
(c) immediately take steps to ensure that the debarment does not
prejudice the interest of clients of the debarred person, and that any
unconcluded business of the debarred person is properly attended to.
The correct answer is: Clients of the debarred Representative are not
disadvantaged and that any unconcluded business is properly concluded

Question 21
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Which of the following statements is TRUE?
Question 21Select one:

a.
Suspension or withdrawal of a licence is initiated by the Authority
following actions or omissions by the FSP.

b.
Lapsing of a licence is initiated by the FSCA following an event that gave
reason for the lapse.

c.
There are provisions in the Act for the reinstatement of a lapsed licence.

d.
There are severe implications in terms of other legislation when a FAIS
licence lapses.
Feedback
Your answer is correct.
Refer to Section 9 of the FAIS Act for the suspension and withdrawal of
authorisation.
The correct answer is: Suspension or withdrawal of a licence is initiated
by the Authority following actions or omissions by the FSP.

Question 22
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Which of the following activities qualify as CPD activities?
Question 22Select one:

a.
Courses performed towards a qualification.

b.
Product Specific Training.
c.
Conferences, workshops and seminars accredited by a professional body.

d.
Passing a Regulatory Examination.
Feedback
Your answer is correct.
In terms of Board Notice 194 of 2017 as amended, a 'CPD activity' means
an activity that is:
(a) approved by a professional body that confirmed that the activity is
verifiable; and
(b) allocated an hour value or a part thereof by a professional body;
and excludes:
(c) an activity performed towards a qualification; and
(d) Product Specific Training.
The correct answer is: Conferences, workshops and seminars accredited
by a professional body.

Question 23
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Which of the following may be conditions on an FSP licence?
i. Reference to the Categories for which the FSP is authorised.
ii. Applicable conditions about the Fit and Proper status of the Key
Individuals who need to obtain certain qualifications within a certain
period of time from the date of licensing the FSP.
iii. Instructions regarding the display of licences.
iv. Applicable conditions about the Fit and Proper status of the
Representatives who need to obtain certain qualifications within a
certain period of time from the date of licensing the FSP.
Question 23Select one:

a.
i and iv only.

b.
i and iii only.
c.
ii and iv only.

d.
i and ii only.
Feedback
Your answer is incorrect.
According to Section 8(4), the Registrar may impose certain conditions
and restrictions. There are standard conditions, and there may also be
conditions specifically applicable to the FSP licence. The licensing
conditions may also include exemptions applicable to the FSP. Section
8(8)(a) and (b) of the FAIS Act states that a licensee must display a
certified copy of the license in a prominent and durable manner within
every business premises of the licensee and ensure that reference to the
fact that such licence is held is contained in all business documentation,
advertisements and other promotional material.
The correct answer is: ii and iv only.

Question 24
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Advice EXCLUDES:
Question 24Select one:

a.
Procedures to do a financial transaction.

b.
Describing a financial product.

c.
Factual information about products.

d.
All of the above.

Feedback
Your answer is correct.
In terms of Section 1(3)(a)(i) of FAIS, advice does not include factual
advice given merely:
aa) on the procedure for entering into a transaction in respect of any
financial product;
bb) in relation to the description of a financial product;
dd) in the form of objective information about a particular financial
product.

The correct answer is: All of the above.

Question 25
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The FAIS Act requires that the Representative makes certain disclosures
during their interaction with the client. The purpose of these disclosures is
to:
Question 25Select one:

a.
Enable the client to make an informed decision.

b.
Enable the insurer to evaluate the risk.

c.
Be used as an agenda for a discussion with the client.

d.
Inform the client of the FSP’s complaints resolution process.
Feedback
Your answer is correct.
In terms of Section 7(1)(a) of the General Code of Conduct, a provider
other than a direct marketer, must provide a reasonable and appropriate
general explanation of the nature and material terms of the relevant
contract or transaction to a client and generally make full and frank
disclosure of any information that would reasonably be expected to enable
the client to make an informed decision.
The correct answer is: Enable the client to make an informed decision.
What is/are the Financial Intelligence Centre's main objective(s)?
i. Identifying proceeds of unlawful activities.
ii. Identification of person involved in money-laundering activities,
offenses relating to the financing of terrorist and related activities, and
proliferation financing activities.
iii. Combatting money-laundering activities, the financing of terrorist and
proliferation financing activities.
iv. Implementing financial sanctions pursuant to resolutions adopted by
the Security Council of the United Nations.

Question 26Select one:

a.
i only.

b.
i, ii and iii only.

c.
i, ii, iii and iv.

d.
ii and iii only.
Feedback
Your answer is correct.
In terms of Section 3(1) of the FIC Act as amended, the principal objectives
of the Centre is to assist in identifying the proceeds of unlawful activities;
identifying persons involved in money-laundering activities, offenses
relating to the financing of terrorist and related activities, and proliferation
financing activities; combatting money-laundering activities and the
financing of terrorist and proliferation financing activities; and
implementing financial sanctions pursuant to resolutions adopted by the
Security Council of the United Nations.
The correct answer is: i, ii, iii and iv.

Question 27
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Choose the INCORRECT answer.
When past investment performance is provided for or referred to in an
advertisement:
Question 27Answer

a.
A statement may be included that past performance can be
extrapolated into the future.

b.
All information must be accurate and be provided in the correct context.

c.
The FSP must be able to substantiate all claims made.

d.
A statement must be included that past performance is not an indication
of future performance.
Feedback
Your answer is incorrect.
According to Section 14(15)(c)(ii) of the FAIS General Code of Conduct,
when past investment performance is provided for or referred to in an
advertisement, a statement must be included that past performance
cannot be extrapolated into the future and is not an indication of future
performance.
The correct answer is:
A statement may be included that past performance can be extrapolated
into the future.

Question 28
Incorrect
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When a Representative acts under supervision, it means that they do not
yet meet the Fit and Proper Requirements of:
Question 28Select one:

a.
Experience and Qualifications.

b.
Qualifications and/or Regulatory Examinations.

c.
Qualifications, Experience, Class of Business and/or Regulatory
Examinations.

d.
Experience and Regulatory Examinations.
Feedback
Your answer is incorrect.
In terms of Section 1 of FAIS Notice 86 of 2018, the definition of a
'supervised Representative' means a Representative who does not meet
one or more of the competency requirements and who renders financial
services under supervision.
The correct answer is: Qualifications, Experience, Class of Business
and/or Regulatory Examinations.

Question 29
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The person performing the compliance function in the FSP must report a
suspicious transaction to the FIC within:
Question 29Select one:

a.
15 working days of learning of it.

b.
15 days of learning of it or from when the suspicion arose.

c.
15 working days from when the suspicion arose.

d.
30 days of learning of it.
Feedback
Your answer is incorrect.
In terms of Regulation 24(3) of the Money Laundering and Terrorist
Financing Control Regulations, a report under Section 29 of the FIC Act
must be sent to the Centre as soon as possible but not later than 15 days
after a natural person or any of their employees, or any of the employees
or officers of a legal person or other entity, has become aware of a fact
concerning a transaction on the basis of which knowledge or a suspicion
concerning the transaction must be reported.
The correct answer is: 15 days of learning of it or from when the
suspicion arose.

Question 30
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Robert is a Representative and is required by the FAIS General Code of
Conduct to make certain disclosures during his interaction with the client.
These disclosures should be made at the:
Question 30Select one:

a.
Contact stage and quotation stage.

b.
Quotation stage and acceptance stage.

c.
Contact stage only.

d.
Quotation stage only.
Feedback
Your answer is incorrect.
In terms of Section 5 of the FAIS General Code of Conduct, where a
provider other than a direct marketer renders a financial service to a
client, the provider must at the earliest reasonable opportunity furnish the
client with full particulars of the information contained in this section and,
where such information is provided orally, must confirm such information
within 30 days in writing.
The correct answer is: Contact stage and quotation stage.

Question 31
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Which of the following is NOT required in terms of FAIS? Representations
made and information provided to a client by the provider:
Question 31Select one:

a.
Must be factually correct.

b.
Must, subject to the provisions of the General Code of Conduct, be
provided orally and may be confirmed in writing within 30 days.

c.
Must, where provided in writing or by means of standard forms or format,
be in a clear and readable print size, spacing and format.

d.
Must be provided in plain language, avoid uncertainty or confusion and
not be misleading.
Feedback
Your answer is incorrect.
In terms of Section 3(a)(v) of the General Code of Conduct,
representations made and information provided to a client by the provider
may, subject to the provisions of this Code, be provided orally and, at the
client’s request, confirmed in writing within a reasonable time after such
request.
The correct answer is: Must, subject to the provisions of the General Code
of Conduct, be provided orally and may be confirmed in writing within 30
days.

Question 32
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The purpose of POCA is to introduce measures to combat:
Question 32Select one:

a.
Organised crime and money laundering.

b.
Money laundering and criminal gang activities.

c.
Organised crime, money laundering and criminal gang activities.

d.
Organised crime and criminal gang activities.
Feedback
Your answer is correct.
Chapters 3,4 and 5 of the POCA states that the purpose of POCA is to
introduce measures to combat organised crime, money laundering and
criminal gang activities.
The correct answer is: Organised crime, money laundering and criminal
gang activities.

Question 33
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John has been licensed as an FSP of ABC Finance for the past two years.
A colleague, Laura, who worked with him at Safe Insurance many years
ago has been appointed at ABC Finance and realised that John left Safe
Insurance under a cloud because his licence was withdrawn at the time
due to dishonesty. Choose the CORRECT statement:
Question 33Select one:

a.
If Laura reports the previous withdrawal of John's licence to the Authority,
his current licence may be withdrawn on the grounds that he did not
disclose all relevant information to the Authority.

b.
If Laura reports the previous withdrawal of John's licence to the Authority,
it will not have any effect on his current licence.

c.
If Laura reports the previous withdrawal of John's licence to the Authority,
he will have to continue working under supervision.

d.
If Laura reports the previous withdrawal of John's to the Authority, they
may determine that he should do additional CPD hours for the next two
years.
Feedback
Your answer is correct.
In terms of Section 9(1)(a) of FAIS, the Authority may, at any time,
suspend or withdraw any licence if satisfied that the licensee no longer
meets the requirements contemplated in Section 8.
The correct answer is: If Laura reports the previous withdrawal of John's
licence to the Authority, his current licence may be withdrawn on the
grounds that he did not disclose all relevant information to the Authority.

Question 34
Correct
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If an accountable institution established a business relationship with a
client before the commencement of the FIC Act:
Question 34Select one:

a.
The identity of the client only needs to be verified in the case of an
exceptionally large transaction.

b.
The provision of the FIC Act will not apply to the relationship.

c.
Customer due diligence should still be performed.

d.
The identity of the client only needs to be verified in the case of a
suspicious transaction.
Feedback
Your answer is correct.
In terms of Section 21(2) of the FIC Act as amended, if an accountable
institution had established a business relationship with a client before this
Act took effect, the accountable institution may not conclude a transaction
in the course of that business relationship, unless the accountable
institution has taken the prescribed steps:
(a) to establish and verify the identity of the client;
(b) if another person acted on behalf of the client in establishing the
business relationship, to establish and verify:
i. the identity of that other person; and
ii. that other person’s authority to act on behalf of the client.
The correct answer is: Customer due diligence should still be performed.

Question 35
Correct
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Certain documentation can be used for customer due diligence
procedures for South African citizens in line with the FIC Act. Choose the
statement that does NOT apply to an SA citizen.
Question 35Select one:

a.
A copy of a green, barcoded ID book.

b.
A utility bill for proof of residential address.

c.
A letter of confirmation from a colleague stating that you are who you say
you are.

d.
A bank statement from another bank reflecting your name and address.
Feedback
Your answer is correct.
In terms of FIC Guidance Note 3A, recommendation 15, in instances when
an accountable institution requires further confirmation of the identity of a
foreign national, the accountable institution may obtain a letter of
confirmation from a person in authority (for example, from the relevant
embassy) which confirms authenticity of that person’s identity document
(passport).
The correct answer is: A letter of confirmation from a colleague stating
that you are who you say you are.
The Prevention of Organised Crime Act (POCA) contains measures
primarily designed to combat:
Question 36Select one:

a.
Illegal gambling.
b.
Drug dealing.

c.
Organised crime, money laundering and criminal gang activities.

d.
Conspiracies to commit major offences.
Feedback
Your answer is correct.
According to the POCA preamble, the measures are primarily designed to
combat organised crime, money laundering and criminal gang activities.
The correct answer is: Organised crime, money laundering and criminal
gang activities.

Question 37
Correct
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You are the sales manager or supervisor of a new Representative. He
asks you when a Representative can be debarred, and you tell him the
following:
i. Non-compliance with any of the Fit and Proper requirements.
ii. Non-compliance with any provision of the FAIS Act.
iii. Poor work performance.
iv. Continually not doing a comprehensive record of advice.
Question 37Select one:

a.
iii and iv.

b.
ii, iii and iv.

c.
i, ii and iv.

d.
i and iv.
 Feedback
Your answer is correct.
Section 14(1)(a)(iii) and (iv) requires an FSP to debar a Representative if
the Representative does not meet or no longer complies with the Fit and
Proper requirements or has contravened or failed to comply with any
provision of this Act in a material manner. Poor work performance is not
addressed in FAIS legislation.
The correct answer is: i, ii and iv.

Question 38
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In performing an analysis, an FSP may in determining the extent of the
client information necessary to provide appropriate advice, take into
account:
i. Any specific objectives or needs of the client that the client
explicitly requested the provider to focus on, or not to focus on.
ii. The fact that the client has explicitly declined to provide
any information requested by the FSP.
iii. Any specific objectives or needs of the FSP that the FSP has explicitly
agreed to focus on or not to focus on.
iv. Applicable surrounding circumstances that make it clear that the
analysis can reasonably be expected by the client to focus only on
specific objectives or specific needs of the client.
Question 38Answer

a.
i and iii only.

b.
i, ii and iv only.

c.
iii and iv only.

d.
i, ii, iii, and iv.
Feedback
Your answer is incorrect.
Refer to Section 8 of the FAIS General Code of Conduct. This section sets
out what is required from the client in order to provide suitable advice
and recommend a product, however it does not state that the FSP has to
provide its specific needs and objectives.
The correct answer is: i, ii and iv only.

Question 39
Correct
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You have to advise a new financial services provider on the FAIS
requirements for the maintenance and accessibility of records. The
financial services provider has limited space in his office and cannot store
the hard-copy records that have to be kept for five years. What advice
would you give him?
Question 39Select one:

a.
The financial services provider has to find space in his office as he is
obliged to keep the hard-copy records on his premises for five years to
ensure that they are available for inspection within seven days of the
Authority's request.

b.
The financial services provider may outsource recordkeeping, but it has to
be available for inspection within seven days of the Authority's request.
The financial services provider may also keep the records in appropriate
electronic or recorded format if they are accessible and readily
reducible to written or printed format.

c.
The financial services provider may not outsource recordkeeping and he
should, therefore, convert the records into appropriate electronic format,
so that they will be available on his premises at all times.

d.
The financial services provider may outsource recordkeeping on condition
that the records are in appropriate electronic or recorded format, and
they should be readily reducible to written or printed format.
Feedback
Your answer is correct.
In terms of Section 3(2)(c) of the General Code of Conduct, providers are
not required to keep the records themselves, but must ensure that they
are available for inspection within seven days of the Authority's request.
Furthermore, in terms of Section 3(2)(d) of the General Code of Conduct,
records may be kept in an appropriate electronic or recorded format,
which are accessible and readily reducible to written or printed form.
The correct answer is: The financial services provider may outsource
recordkeeping, but it has to be available for inspection within seven days
of the Authority's request. The financial services provider may also keep
the records in appropriate electronic or recorded format if they are
accessible and readily reducible to written or printed format.

Question 40
Correct
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If an employee of an accountable institution accepts money from a client
which is suspicious, what does the employee have to do according to the
FIC Act? Choose the statement that does NOT apply.
Question 40Select one:

a.
The employee must report the suspicious transaction following their
company’s procedure as outlined in its Risk Management and
Compliance Programme.

b.
The employee may not inform the client that they have reported the
transaction.

c.
The employee has to report the suspicious transaction to the Ombud.

d.
a and b.
Feedback
Your answer is correct.
In terms of Section 29(1)(a) of the FIC Act, (1) a person is employed by a
business and who knows or ought reasonably to have known or suspected
that:
(a) the business has received or is about to receive the proceeds of
unlawful activities or property which is connected to an offence relating to
the financing of terrorist and related activities, must, within the
prescribed period after the knowledge was acquired or the suspicion
arose, report to the Centre the grounds for the knowledge or suspicion
and the prescribed particulars concerning the transaction or series of
transactions.
The correct answer is: The employee has to report the suspicious
transaction to the Ombud.

Which of the following is an intermediary service?

a.
Informing a client of the different products in the industry.

b.
Collecting premiums from a client.

c.
Guiding a client to purchase a new financial product.

d.
Ensuring that the client pays regular premiums to a product supplier.

Feedbac
k Your answer is correct.
In terms of Section 1 of the FAIS Act as amended, the definition of
'intermediary service' includes collecting or accounting for premiums or
other monies payable by the client in respect of a financial product.
The correct answer is: Collecting premiums from a client.
Question 42
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What is the cost for lodging a complaint with the FAIS Ombud?
Question 42Select one:

a.
There is a standard administration fee as determined by the FAIS Ombud
office.

b.
There is no cost, however, the Ombud, when accepting a complaint, may
require the respondent to pay a case fee to the office.
c.
There is a fee, as determined by the Ombudsman, which would amount to
a percentage of the amount of money involved in the complaint.

d.
There is no cost at all, no matter the grounds of the complaint.
Feedback
Your answer is correct.
In terms of Section 9(a) of Board Notice 81 of 2003, the Ombud may, when
accepting a complaint, require the respondent to pay a case fee to the
office not exceeding R1000.00.
The correct answer is: There is no cost, however, the Ombud, when
accepting a complaint, may require the respondent to pay a case fee to
the office.

Question 43
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The FSP must have a separate bank account at a bank, designated to
receive funds and premiums from clients, which is separate from any
other funds.
Which statement below is TRUE in respect of bank charges?
Question 43Select one:

a.
The FSP is responsible for bank charges including the charges which
relate to deposit or withdrawals.

b.
The FSP is responsible for bank charges except the charges which relate
to deposit or withdrawals, which the client must pay.

c.
The client is responsible for all bank charges, but the FSP must pay all
interest accumulating in the account to the client or owner of the funds.

d.
The FSP is responsible for all bank charges, but may retain all interest
accumulating in the account.
Feedback
Your answer is correct.
In terms of Section 10(1)(d) of the FAIS General Code of Conduct, a
provider who receives or holds financial products or funds of or on behalf
of a client must account for such products or funds properly and promptly
and open and maintain a separate account, designated for client funds, at
a bank and:
(iii) pay all bank charges in respect of the separate account except that
bank charges specifically relating to a deposit or withdrawal of the funds
of the client are for the client's own account; and
(iv) ensure that any interest accruing to the funds in the separate account
is payable to the client or the owner of the funds.
The correct answer is: The FSP is responsible for bank charges except the
charges which relate to deposit or withdrawals, which the client must pay.

Question 44
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Joanne is a Representative of ABC Finance, and she needs to disclose the
following with regard to the commission payable in respect of financial
products or services:
i. The nature, extent and frequency of any incentive, remuneration,
consideration, commission, fee or brokerages ('valuable consideration'),
which will or may become payable to the provider, directly or indirectly,
by any product supplier or any person other than the client.
ii. Where a financial product is being replaced by another financial
product, full details must be disclosed of any incentive, remuneration,
consideration, commission, fee or brokerages received, directly or
indirectly, by the provider on the terminated product but it is not required
where provider rendered financial services on both the terminated and
replacement product.
iii. Where a financial product is being replaced by another financial
product, full details must be disclosed of any incentive, remuneration,
consideration, commission, fee or brokerages received, directly or
indirectly, by the provider on the terminated product and the same by the
provider on the replacement product where the provider rendered
financial services on both the terminated and replacement product.
iv. The identity of the product supplier or other person providing or
offering the valuable consideration.
Question 44Select one:

a.
i, ii and iv only.

b.
i, iii and iv only.

c.
ii and iv only.

d.
i and iv only.
Feedback
Your answer is correct.
Sections 7(1)(c)(vi) and 8(1)(d)(ix) of the General Code of Conduct relate
to the disclosure of commission – Section 7 generally, and Section 8 for
replacements.
The correct answer is: i, iii and iv only.

Question 45
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After the introduction of FAIS, aggrieved clients:
Question 45Select one:

a.
Still have to prove that inappropriate or poor advice caused them damage
or loss.

b.
No longer have to prove that the inappropriate or poor advice caused
them damage or loss.

c.
Can now obtain redress from the Ombud on a no-fault basis, without
having to prove anything against the advisor.

d.
Can now obtain redress from the Ombud, but must first endeavour to
resolve the complaint with the FSP before submitting a complaint to the
Office.
Feedback
Your answer is correct.
In terms of Section 5(b) of Board Notice 81 of 2003, the complainant
must, before submitting a complaint to the Office, endeavour to resolve
the complaint with the respondent.
The correct answer is: Can now obtain redress from the Ombud, but must
first endeavour to resolve the complaint with the FSP before submitting a
complaint to the Office.

No person my become or continue as an FSP or juristic Representative if:

a.
Declared insolvent.

b.
Placed under liquidation.

c.
Declared provisionally insolvent or placed under provisional liquidation.

d.
All of the above.

Feedbac
k Your answer is correct.
In terms of the Board Notice 194 of 2017, Section 44(3), no person may
become or continue as an FSP or juristic Representative if declared
insolvent or provisionally insolvent; or placed under liquidation or
provisional liquidation.
The correct answer is: All of the above.
Question 47
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Choose the INCORRECT answer.
If an FSP is not able to identify a suitable financial product that will be
appropriate to the client’s needs and objectives, due to limitations
imposed on the FSP under the FAIS Act or any contractual agreement, the
FSP must:
Question 47Answer
a.
Make it clear to the client that it cannot identify a financial product which
will be appropriate.

b.
Decline to recommend a product or transaction.

c.
Recommend an alternate product which the FSP can offer.

d.
Suggest to the client that they should seek advice from another
appropriately authorised provider.
Feedback
Your answer is incorrect.
According to Section 8(1)(cA) of the FAIS General Code of Conduct, where,
as a result of limitations referred to in paragraph (c), the provider is not
able to identify a financial product or products that will be
appropriate to the client’s needs and objectives, financial situation, risk
profile and product knowledge and experience, the provider must make
this clear to the client, decline to recommend a product or transaction and
suggest to the client that they should seek advice from another
appropriately authorised provider.
The correct answer is:
Recommend an alternate product which the FSP can offer.

Question 48
Correct
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FSPs and Representatives have certain responsibilities with regard to the
qualifications of Representatives and duties of FSPs towards the
maintenance of the FAIS licence as contained in Section 13 of the FAIS
Act.
Which statement best describes this responsibility?
Question 48Select one:

a.
Nobody may act as a Key Individual for an FSP unless the person can
confirm to clients (certified by the FSP) that they have an employment or
mandate agreement with the FSP to represent the FSP and that the FSP
accepts responsibility for the activities of the Key Individual performed in
terms of the agreement.

b.
The Board of Directors must at all times take reasonable steps to ensure
that Representatives comply with applicable codes of conduct and with
other applicable laws on conduct of business.

c.
Nobody may act as a Representative for an FSP unless the person can
confirm to clients (certified by the FSP) that they have an employment or
mandate agreement with the FSP to represent the FSP and that the FSP
accepts responsibility for the activities of the Representative performed in
terms of the agreement.

d.
If a Representative was debarred, they can never operate as a
Representative again.
Feedback
Your answer is correct.
In terms of Section 13(b)(i)(aa) and (bb), a person may not act as a
Representative of an authorised financial services provider, unless such
person, prior to rendering a financial service, provides confirmation
certified by the provider that a service contract or other mandate to
represent the provider exists and that the provider accepts responsibility
for those activities of the Representative.
The correct answer is: Nobody may act as a Representative for an FSP
unless the person can confirm to clients (certified by the FSP) that they
have an employment or mandate agreement with the FSP to represent
the FSP and that the FSP accepts responsibility for the activities of the
Representative performed in terms of the agreement.

Question 49
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Section 24(3) of the FIC Act stipulates that if the accountable institution
appoints a third party to keep records on its behalf, then particulars of the
third party keeping records on behalf of the accountable institution must
be provided to which body or bodies?
Question 49Select one:
a.
Financial Ombud Centre.

b.
Financial Intelligence Centre and supervisory body.

c.
Supervisory body.

d.
Financial Intelligence Centre.
Feedback
Your answer is correct.
An accountable institution must inform the Financial Intelligence Centre
and the supervisory body of the accountable institution of the particulars
of the third party who will keep customer due diligence records (Section
22) and transaction records (Section 22A) on behalf of the accountable
institution.
The correct answer is: Financial Intelligence Centre and supervisory body.

Question 50
Correct
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Select the INCORRECT option.
The Fit and Proper requirements in terms of Board Notice 194 of 2017
that are applicable to Representatives are:
Question 50Select one:

a.
Honesty, Integrity and Good Standing requirements.

b.
Experience requirements and qualifications.

c.
Regulatory Examinations and Continuous Professional Development.

d.
Financial Soundness.
 Feedback
Your answer is correct.
In terms of Section 43(b)(i) of Board Notice 194 of 2017, the Fit and Proper
requirements relating to financial soundness contained in this Chapter (b)
do not apply to (i) a Key Individual or a Representative that is a natural
person.
The correct answer is: Financial Soundness.