CSC Canadian Regulatory Environment 3

Question 1

Under National Instrument 31-103, which registration category applies to an individual who provides securities advice directly to clients?

Accepted Answer

Advising representative

Answer

An advising representative is registered to provide advice on securities to clients, while a dealing representative is registered to execute trades or distribute securities.

Question 2

The Know Your Client (KYC) rule requires registrants to collect all of the following client information EXCEPT:

Accepted Answer

Political party affiliation

Answer

KYC rules require collecting investment objectives, risk tolerance, time horizon, financial situation, and other relevant personal information, but political affiliation is not a required KYC data point.

Question 3

Under suitability obligations in NI 31-103, a registrant must assess suitability:

Accepted Answer

When accepting a client order, making a recommendation, or when a material change in the client's circumstances occurs

Answer

Suitability must be assessed whenever an order is accepted, a recommendation is made, the client's know-your-client information changes materially, or securities are transferred into the account.

Question 4

FINTRAC requires a Large Cash Transaction Report (LCTR) to be filed when a client conducts a cash transaction of:

Accepted Answer

$10,000 CAD or more in a single transaction or series of transactions within 24 hours

Answer

Any cash transaction or series of cash transactions totaling $10,000 or more within a 24-hour period must be reported to FINTRAC as a Large Cash Transaction Report.

Question 5

Which FINTRAC report must be filed when a transaction—regardless of dollar amount—appears linked to money laundering or terrorist financing?

Accepted Answer

Suspicious Transaction Report (STR)

Answer

A Suspicious Transaction Report must be filed when there are reasonable grounds to suspect a transaction is related to money laundering or terrorist financing, with no minimum dollar threshold.

CSC - Canadian Securities Course Practice Test

CSC - Canadian Securities Course Practice Test

CSC Canadian Regulatory Environment 3