Qualified Financial Adviser (QFA) Regulations Exam 1 Practice Test

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• Where should client compliance documents be stored?
• What is the role of AML/CTF measures in the QFA framework?
• What constitutes effective client onboarding?
• Which body should be notified in writing before establishing a subsidiary to provide new services?
• What is the purpose of Records of Advice (ROA)?
• ABC Life & Pensions Ltd, an insurance intermediary, is required under the Consumer Protection Code to display a schedule of its fees and charges: (i) in its public offices. (ii) on its website. (iii) on all its business stationery.
• Which statement about the Deposit Guarantee Scheme coverage is true?
• BASE Life Co has just discovered a material error in the unit pricing for one of its unit funds, which means that some of its policyholders in that fund have fewer units allocated to their policy than they should have. BASE Life Co must inform the Central Bank of the error if it has not been resolved within which MAXIMUM period from the time the error was first discovered?
• Which statement correctly describes the use of vital interests as a basis for data processing under GDPR?
• Peter believes that some personal data held on him by ABC Bank plc is inaccurate. In relation to the inaccurate data, Peter can:
• Which factors may be considered in determining measures to process personal data securely under GDPR?
• When is a Statement of Advice (SOA) required?
• An intermediary that can legally act for only one bank in receiving deposits is best described as which term?
• Which of the following can potentially claim on the Investor Compensation Scheme?
• Under which act are investment intermediaries regulated?
• Which of the following describes a best practice for data backups in a compliance framework?
• In fitness and probity, which function is described as requiring prior approval?
• Which of the following is essential to include in exam preparation for the QFA Regulations Exam 1?
• Which of the following statements regarding PEP relationships is correct?
• Which statement demonstrates best execution in the client example?
• Under the Consumer Protection Code, a life assurance company may charge a fee for an optional extra benefit under a new policy only if the consumer has:
• In a compliance framework, how do supervision and monitoring differ?
• What is the minimum content expected in a Statement of Advice (SOA)?
• Kathleen has made a written complaint to ABC Life Co. Under the Consumer Protection Code, ABC must attempt to investigate and resolve her complaint within what MAXIMUM period of time?
• A consumer cannot refer an unresolved complaint that does not relate to a long-term financial service to the FSPO if the conduct complained of occurred more than how many years before the complaint?
• Delta Partners is a firm of accountants and a certified person. Its current total gross annual fee income from all activities, including investment services, is €1 million. What is the maximum amount of its gross annual fee income that can be derived from investment services?
• How does technology affect QFA compliance and record-keeping?
• If a client is suspected of money laundering, which authority is the appropriate unit to contact?
• Under Data Protection legislation, personal data includes data held on computers, in manual paper files, and on USB sticks. Which option correctly reflects this?
• For ACE Investment Advisers Ltd to provide advice on UCITS funds, which prerequisites are required?
• Why is product knowledge important for advisers?
• Which action represents a regulatory risk in financial advisory practice?
• The maximum financial redress the FSPO can award in respect of a complaint against a pension provider is?
• The prescription of procedures which must be followed by financial services firms in their dealings with consumers is which type of regulation?
• What is the primary objective of structural regulation of financial services firms?
• In money-laundering controls, the official designated to receive suspicious activity reports within a financial institution is the:
• If a life assurance company established in Germany sells policies to residents in Ireland, which regulator supervises its solvency?
• ABC Life Co can rely on Top Insurance Brokers Ltd, an insurance intermediary, to carry out which of the following Customer Due Diligence requirements on behalf of the life company? (i) Identifying a customer. (ii) Verifying the identity of the beneficial owner of a customer. (iii) Obtaining information on the purpose of the business relationship with a customer.
• The Central Bank does NOT authorise and regulate which one of the following entities established in the State?
• Alan arranged a Personal Pension Plan over the internet. What is the legal cooling-off period?
• Who must be registered as a Financial Services Provider (FSP) under FAIS?
• The Central Bank shares its power to undertake surveys of the provision of financial services to consumers with the:
• A life assurance company established in Germany sells policies to residents of the Republic of Ireland. Who regulates the solvency of this life company?
• Which statement about Simplified CDD eligibility is true?
• An intermediary that wishes to provide advice to consumers on a PRSA issued by a life assurance company must be authorized as which intermediary?
• OAK Advisers Ltd, an investment intermediary, is advising Catherine on the investment of a large lump sum. Under the Consumer Protection Code OAK is required, when dealing with Catherine, to:
• Which statement correctly describes the FSPO's authority over complaints?
• Under the General Data Protection Regulation, a bank can process personal data if the processing is:
• What is the maximum amount Owen may recover from the Investor Compensation Scheme for his €35,000 investment?
• Seán is a client of an insurance intermediary, ABC Ltd. Under the Consumer Protection Code, which of the following situations must ABC treat as a complaint? (i) A statement by Seán during a telephone conversation with ABC that he is dissatisfied with the return his pension plan is producing. (ii) An email from Seán to ABC in which he indicates that he is dissatisfied with the frequency with which ABC reviews his affairs. (iii) A statement by Seán during a meeting with ABC that he feels ABC took too much commission on the last investment it arranged for him. A (ii) only. B (iii) only. C (i) and (ii) only. D (i), (ii) and (iii).
• ACE Insurance Advisers Ltd must be authorized and registered under which regulation when acting solely as an insurance intermediary?
• A member of an occupational pension scheme feels that the trustees of the scheme are not complying with their obligations under the Pensions Act, 1990. This member should refer their complaint to the:
• Under the Consumer Protection Code, a life assurance company can charge a consumer a fee for an optional extra benefit under a new policy, ONLY if the consumer:
• Which one of the following is NOT a level of Customer Due Diligence?
• How should referral arrangements be disclosed to clients?
• The Competition and Consumer Protection Commission can impose a levy on:
• In the DEF Life Ltd licensing context, offering clients the option to pay for services by fee is part of the criteria for using the term 'insurance broker'.
• Which statement best describes the treatment of product details and risks in client communications?
• Which statement best describes the ROA (Record of Advice) and SOA (Statement of Advice) in the QFA process?
• The Deposit Guarantee Scheme covers which of the following deposits?
• In relation to a financial services firm established in an EU country, the term 'freedom of services' means:
• A financial services provider is advertising an investment product that can fluctuate in value and does not guarantee a return of capital. Which warning statement must be included in the advertisement?
• Disclosure of commission by an intermediary to a client is required when arranging which products?
• Elaine cannot refer a complaint about an insurance intermediary to the Financial Services & Pensions Ombudsman until she gets what from the intermediary?
• Which body does the Central Bank share the power to prohibit unfair, misleading or aggressive practices with?
• How should fees, including commissions, be disclosed?
• What are best practices for client communications?
• Before establishing a subsidiary that will provide auctioneering services, what must Alpha Brokers Ltd do first?
• Which body is primarily responsible for granting permission to provide advice on collective investment funds (UCITS)?
• What is a soft-dollar arrangement and how should it be disclosed?
• Are trustees of large defined benefit occupational pension schemes covered deposits under the Deposit Guarantee Scheme?
• What is the role of ongoing education and training in maintaining QFA standards?
• Which statement about Customer Due Diligence for AML is true?
• Which of the following CDD items is intended to gather information about the purpose of the business relationship?
• Which of the following is NOT subject to the Central Bank's Consumer Protection Code when providing financial services to consumers?
• How should client files be organized for easy retrieval during audits?
• An investment intermediary CANNOT provide investment advice on which of the following?
• Which statement best describes the rights provided to data subjects under privacy laws like POPIA?
• A bank CANNOT apply Simplified Customer Due Diligence where the customer is: (i) another bank. (ii) a Politically Exposed Person. (iii) a public body.
• Harry, a client of a MiFID investment firm, has asked the firm to classify him as a professional investor for the purposes of arranging a particular investment for him. The firm may classify Harry as a professional investor only if he:
• The MAXIMUM fines the Central Bank can impose personally on a bank CEO for non-compliance by the bank with financial services regulations is:
• What must be disclosed about fees and remuneration in a disclosure document?
• What action should be taken when product features change?
• Which statement about ROA is true?
• A MiFID investment firm has received an order from a retail client to invest in CFDs without providing investment advice. The firm is required to:
• Who must be informed by BASE Life Co when unit pricing error is not resolved within the maximum period?
• When a MiFID investment firm is providing advice to a client on investing in a deposit, it must comply with the:
• The Deposit Guarantee Scheme’s coverage extends to deposits held by which of the following groups when held at the same bank?
• ABC Bank plc can apply Simplified Customer Due Diligence to which customer?
• Which document set should be separated and version-controlled to support audit readiness?
• A consumer can refer an unresolved complaint about which of the following to the Financial Services & Pensions Ombudsman? (i) Home reversion firm. (ii) A credit intermediary. (iii) A mortgage intermediary. A (ii) only. B (i) and (ii) only. C (ii) and (iii) only. D (i), (ii) and (iii).
• Which scenario would permit unsolicited telephone contact with a non-client for a term assurance offer?
• Which of the following is a valid ground for the FSPO to refuse to investigate a complaint?
• What is the maximum compensation the FSPO can award for a mis-sold investment?
• What is a primary purpose of ongoing education and training for advisers in maintaining QFA standards?
• Which of the following individuals, who work for ABC Life Co, are subject to the Central Bank's Minimum Competency Standards? (i) A personal financial adviser. (ii) The claims manager. (iii) The complaints manager.
• What records must be kept for regulatory compliance and for how long?
• What is the function of quality assurance reviews in the advice process?
• What is the difference between the appropriateness test and the suitability test?
• In a best execution scenario, which outcome did the adviser aim to achieve for the client?
• What steps should a candidate take to prepare for the QFA Regulations Exam 1?
• What must be done with 'Reason Why' statements for a trainee adviser under Minimum Competency Code?
• What is the purpose of the FAIS Code of Conduct?
• What year is cited for the European Communities Unfair Terms in Consumer Contracts Regulations?
• The Deposit Guarantee Scheme covers deposits held by which of the following?
• How should client risk tolerance be assessed and used in advice?
• Which statement about commission disclosure in the arrangement of financial products is true?
• ABC Bank can send John an unsolicited marketing email about other products and services if the bank:
• Which one of the following items of information is NOT required to be included in a bank's Terms of Business?
• How should non-cash compensation be treated in client interactions?
• Which statement about the appropriateness test is correct?
• How should conflicts of interest be handled under FAIS?
• What are the key confidentiality obligations to clients?
• Customer Due Diligence for the prevention and detection of money laundering and terrorist financing includes:
• The Financial Services & Pensions Ombudsman CANNOT in any circumstances investigate a complaint about a pension provider which relates to:
• What is the process for lodging and handling a client complaint?
• The trustees of an occupational pension scheme can appeal the FSPO decision to which body?
• When a life company uses an intermediary to perform CDD, which tasks may the intermediary carry out on its behalf?
• Under the Consumer Protection Code, where must a financial intermediary display its fees and charges schedule?
• A new client refuses to supply requested information to verify identity; what must the firm do?
• Why is client classification important for disclosure?
• Which one of the following can initiate a prosecution under the Unfair Terms Regulations, 1995?
• Which of the following best reflects how advertising and promotions should be regulated under QFA?
• Which statement accurately describes the Central Bank's Consumer Protection Code in this regulatory framework?
• FIT Ltd can make an unsolicited telephone call to Alison, who is NOT an existing client of the firm, if:
• The Central Bank's Consumer Protection Code does NOT apply to:
• Jeremy has applied over the internet to open a bank account. Having established and verified Jeremy's identity by post, the bank can also do which one of the following, as an additional Customer Due Diligence measure?
• Under the Central Bank's Consumer Protection Code, when launching a new investment product, a product producer must provide details of which of the following to any intermediary who will promote and sell that product to consumers?
• What is a Product Disclosure Document or Key Facts Document, and when is it used?
• Which statement best describes client privacy obligations for a QFA?
• Which statements describe the powers of the Financial Services & Pensions Ombudsman in relation to a complaint?
• How should ongoing advisory fees be presented to clients?
• Which European authority is the regulatory body for insurance and pensions across the EU?
• Under the pensions complaints framework, a deceased member's representative may file a complaint with the FSPO. Which of the following best describes this ability?
• Aoife is the head of compliance at ABC Bank plc. For fitness and probity purposes, Aoife's position is a which of the following?
• Which body handles complaints about a pension provider?
• For XYZ to provide advice on UCITS funds provided by TOP Investment Managers Ltd, which prerequisite is required?
• According to the Consumer Protection Code, the minimum retention period for a client fact-finding record is six years.
• A bank is promoting a property fund to its customers. However, the fund is about to buy a property owned by a subsidiary of the bank. In relation to promoting this property fund to its customers, the Consumer Protection Code requires the bank to:
• Which of the following is a consumer for Distance Marketing Regulations?
• The European Communities (Unfair Terms in Consumer Contracts) Regulations, 1995 apply to standard contracts taken out by:
• HWJ Ltd can make an unsolicited telephone call to the personal phone belonging to Aoife who is NOT an existing client of the firm, if:
• What is the purpose of internal escalation procedures in a compliance framework?
• Which of the following is NOT one of the main GDPR obligations for an investment intermediary?
• The Central Bank shares its function to prohibit unfair, misleading or aggressive commercial practices by financial services providers with the:
• What does KYC stand for, and why is it essential in the QFA process?
• What does evidence of needs and suitability demonstrate in client files?
• DEF Life Ltd cannot use the term 'insurance broker' unless which condition is met?
• Lawrence's position as manager of personal financial advisers for ABC Bank plc. For fitness and probity purposes, Lawrence's position is a:
• Under MiFID, when dealing in CFDs with no investment advice given to the client, which assessment must the firm perform?
• What is the difference between a Financial Needs Analysis (FNA) and a Statement of Advice (SOA)?
• Joanne works for a bank. If she makes a whistleblowing report to the Central Bank about the conduct of her employer, this is a protected disclosure provided: (i) the disclosure is not made anonymously; (ii) she makes the disclosure in good faith; (iii) she has reasonable grounds for believing that the bank has committed an offence under financial services legislation.
• In the context of product producers, which combination of entities is permitted to operate as product producers to investment intermediaries?
• Which instrument is NOT a subject on which an investment intermediary may provide advice?
• Which of the following statements about 'fit and proper' is NOT correct?
• What does 'fit and proper' mean in the QFA Regulations context, and what are two key elements?
• Which period is the maximum period within which ABC Life Co must investigate a written complaint?
• A bank can apply Standard Customer Due Diligence requirements to a customer on a risk-based approach if the bank takes account of the:
• Which is true about the onboarding steps and client consent?
• Which one of the following types of investors CANNOT be automatically treated by a MiFID investment firm as a professional client?
• Which elements are captured in records of advice (ROA)?
• Regarding plain language communications under GDPR, which statement is true?
• Do the QFA Regulations require advisers to act in the client’s best interests?
• Mark, who works for ACE Investment Advisers Ltd, has met with a potential new investment customer, Paul, who is a Politically Exposed Person (PEP). Before starting a business relationship with Paul, Mark must:
• An insurance intermediary recruits Fiona as a trainee personal financial adviser. Under the Central Bank's Minimum Competency Code, the intermediary must ensure that: (i) all 'Reason Why' statements provided by Fiona to clients are checked and signed off by another person who holds a recognised qualification. (ii) Fiona is accompanied for an initial period at client meetings by another person who holds a recognised qualification. (iii) Fiona is not allowed to advise on pension products for at least 12 months after commencing employment.
• What is the scope of engagement in advisory services?
• Which term describes prescription of procedures that must be followed by financial services firms in their dealings with consumers?
• Under the Consumer Protection Code, which situation must be treated as a complaint?
• Jacinta invested €80,000 in a deposit tracker bond in July 2016. What amount, if any, of Jacinta's investment is covered by the Deposit Guarantee Scheme?
• Why is a term in a unit linked life policy, which allows the life company to reset the unit price every day, NOT deemed to be an unfair term under the Regulations?
• The Financial Services & Pensions Ombudsman can refuse to investigate a complaint referred to it by a consumer on the grounds that the: (i) complaint is frivolous or vexatious. (ii) consumer failed to comply with a request for further information within a reasonable time. (iii) consumer has insufficient interest in the conduct complained of. A (i) and (ii) only. B (i) and (iii) only. C (ii) and (iii) only. D (i), (ii) and (iii).
• When a life assurance company is providing advice to a client on PRSAs, it must comply with the:
• How should data backups and security be managed in a compliance framework?
• Which statement about retention of records is true?
• What should a complete client file include for compliance?
• Matthew works for an investment firm. If he has reasonable grounds to suspect that one of its customers is engaged in money laundering, he should first report his suspicions to the:
• Mary has contacted ACME Investment Advisers Ltd, an investment intermediary. She indicates that she wants to invest €200,000 she has just inherited. ACME is NOT required to comply with the 'know the consumer' requirement of the Consumer Protection Code in dealing with Mary in relation to her investment, if Mary has specified to them:
• Differentiates between tied and independent advice and its impact on disclosures.
• ACE Life Assurance Co can issue a policy to Dermot before verifying his identity PROVIDED:
• When should a Product Disclosure Document be used?
• What is the function of a Financial Services Guide (FSG)?
• What is the purpose of the FAIS Act in regulating financial advice?
• Under Know the Consumer, if a client specifies the type of investment, the financial institution, and how much per type, the adviser is exempt from Know the Consumer checks.
• Under the CP Code, which detail must be provided to an intermediary about a new investment product?
• Personal data for the purposes of Data Protection legislation includes personal data held on computers, in manual paper files, and on USB sticks. Which statements are true?
• A sole trader has €60,000 in a personal deposit account and €80,000 in a business deposit account with the same bank. What is the maximum total amount she could claim under the Deposit Guarantee Scheme for these two accounts with that bank?
• A bank has cancelled the agency appointment of TOP Investment Advisers Ltd. The bank must: (i) inform the Central Bank immediately of the cancellation. (ii) place a notice of discontinuance in a national newspaper within seven working days. (iii) write to all customers affected by the cancellation informing them of the cancellation within 28 working days.
• The objective of the European Communities (Unfair Terms in Consumer Contracts) Regulations, 1995, is to:
• ABC Insurance Services Ltd wishes to appoint Jack as its Chief Executive. The bank cannot offer Jack this position without prior written consent of which body?
• A MiFID investment firm covered by the Investor Compensation Scheme is NOT allowed to:
• Under the Consumer Protection Code an insurance intermediary which also acts as an auctioneer must: (i) maintain separate sections of its website for its auctioneering and insurance intermediary services. (ii) not use its regulatory disclosure statement on emails sent to its auctioneering clients. (iii) have two separate telephone numbers, one for its auctioneering and the other for its insurance intermediary services.
• Which of the following is not listed as a beneficiary of the Deposit Guarantee Scheme in the materials?
• When an investment intermediary is providing advice to a client on shares listed on a Stock Exchange, it must comply with the:
• The Central Bank's Consumer Protection Code advertising requirements apply to: (i) flyers. (ii) product brochures. (iii) a firm's website.
• What does AML/CTF require for advisers?
• Which combination of FSPO outcomes is a valid decision?
• How should a regulator respond to a breach incident?
• What is a conflicts of interest register and why is it required?
• Who of the following can submit a complaint about a pension provider to the Financial Services & Pensions Ombudsman? (i) A member. (ii) The spouse of a deceased member. (iii) The legal personal representative of a deceased member. A (i) only. B (ii) only. C (i) and (iii) only. D (i), (ii) and (iii).
• After a FSPO ruling on a pension scheme trustees, the trustees can appeal to which body?
• Which ongoing confirmations may be required to maintain fit and proper status?
• Which action is required when an agency appointment is cancelled by a bank?
• Which is a complex product for the MiFID appropriateness test?
• Brown and Co, an insurance intermediary, must provide a receipt to John when accepting from him a:
• Temporary large deposits are covered by the Deposit Guarantee Scheme up to which maximum limit for a temporary period?
• In Owen's complaint about mis-sold investment, which organization administers the compensation?
• What kind of ongoing disclosures or confirmations may be required for a Financial Services Provider (FSP)?
• Which practice reflects proper confidentiality obligations for advisers?
• How should advertising and promotions be regulated under QFA?
• What is the purpose of maintaining a 'conflicts register' in a financial services firm?
• Which statement best describes the CP Standards applicability to roles such as personal financial advisers?
• In dealing with a vulnerable customer who is partially blind, the CPC requires the adviser to:
• What should the SOA include to support the recommendation?
• When should advice be refreshed or reviewed for ongoing suitability?
• Identify common sources of regulatory risk in financial advisory practice.
• What is the difference between consent-based and permissive data sharing?
• Fiona has referred a complaint about ABC Bank plc to the Financial Services & Pensions Ombudsman (FSPO). The FIRST thing the FSPO will do to attempt to resolve the complaint is:
• The cost of the Investor Compensation Scheme is funded by:
• Before ACE Investment Brokers Ltd changes its trading name to ACE Investments, which action must be taken first?
• Which statement describes the two key elements of fit and proper?
• The Consumer Protection Code requires an insurance intermediary to keep records of a fact find for what minimum period after completion?
• What is the role of compliance and risk governance in a financial services entity?
• What is the role of a Compliance Officer?
• NOT a consumer for the Distance Marketing Regulations?