FTT Securities & Futures Regulations 1 — Questions and Answers
Question 1: Which Act is the primary legislation governing the securities and futures industry in Singapore?
- Securities and Futures Act (SFA) (Correct answer)
- Financial Advisers Act (FAA)
- Companies Act
- Monetary Authority of Singapore Act
Correct answer: Securities and Futures Act (SFA)
The Securities and Futures Act (SFA) is the principal legislation in Singapore regulating the securities and futures industry, covering licensing, market conduct, and trading activities.
Question 2: Which regulatory body oversees the securities and futures markets in Singapore?
- Monetary Authority of Singapore (MAS) (Correct answer)
- Singapore Exchange (SGX)
- Commercial Affairs Department (CAD)
- Accounting and Corporate Regulatory Authority (ACRA)
Correct answer: Monetary Authority of Singapore (MAS)
The Monetary Authority of Singapore (MAS) is Singapore's central bank and financial regulatory authority, responsible for overseeing the securities and futures markets.
Question 3: Under the SFA, carrying on a regulated activity without a Capital Markets Services licence is punishable by:
- A fine not exceeding $150,000 and/or imprisonment not exceeding 3 years (Correct answer)
- A fine of $50,000 only
- Only a warning from MAS
- Suspension of business for 6 months
Correct answer: A fine not exceeding $150,000 and/or imprisonment not exceeding 3 years
Under the SFA, carrying on a regulated activity without a CMS licence is an offence punishable by a fine up to $150,000 and/or imprisonment up to 3 years.
Question 4: What is the minimum base capital requirement for a CMS licence holder dealing in securities?
- S$1 million (Correct answer)
- S$500,000
- S$250,000
- S$2 million
Correct answer: S$1 million
CMS licence holders dealing in securities are required to maintain a minimum base capital of S$1 million as prescribed under the Securities and Futures (Financial and Margin Requirements for Holders of Capital Markets Services Licences) Regulations.
Question 5: Which of the following is NOT a regulated activity under the Second Schedule of the SFA?
- Providing accounting services (Correct answer)
- Dealing in capital markets products
- Advising on corporate finance
- Fund management
Correct answer: Providing accounting services
Providing accounting services is not a regulated activity under the SFA. Regulated activities include dealing in capital markets products, advising on corporate finance, fund management, real estate investment trust management, and providing custodial services.
Question 6: A Capital Markets Services Representative must be appointed by:
- A holder of a Capital Markets Services licence (Correct answer)
- The Monetary Authority of Singapore directly
- The Singapore Exchange
- Any registered company
Correct answer: A holder of a Capital Markets Services licence
A CMS Representative must be appointed by a CMS licence holder to conduct regulated activities on behalf of that licence holder. They cannot act independently without such appointment.
FTT Securities & Futures Regulations 1
Which Act is the primary legislation governing the securities and futures industry in Singapore?