CMFAS Securities Regulations M1 3

Question 1

What is the 'fit and proper' requirement for representatives?

Accepted Answer

Meeting criteria of honesty, integrity, competence, and financial soundness

Answer

The 'fit and proper' criteria assess whether a person has the honesty, integrity, reputation, competence, and financial soundness to carry out regulated activities.

Question 2

How long must financial institutions retain records of transactions under the SFA?

Accepted Answer

5 years

Answer

Financial institutions are generally required to retain transaction records for a minimum of 5 years under SFA regulations.

Question 3

What is the penalty for insider trading under the SFA?

Accepted Answer

Fine and/or imprisonment

Answer

Insider trading is a serious offence under the SFA that can result in substantial fines and/or imprisonment.

Question 4

What is a 'connected person' in securities regulation?

Accepted Answer

A person related to or associated with an insider who has access to non-public information

Answer

A connected person is someone who is related to or has a close association with a person possessing inside information.

Question 5

What does 'continuous disclosure' require of listed companies?

Accepted Answer

Promptly disclosing material information that may affect share prices

Answer

Continuous disclosure requires listed companies to promptly announce any material information that could affect their share price, ensuring all investors have equal access.

CMFAS Practice Test

CMFAS Practice Test

CMFAS Securities Regulations M1 3