Securities Regulations M1 Flashcards

What is the 'know your client' (KYC) requirement?

Answer: Verifying the client's identity and understanding their financial profile

KYC requires financial institutions to verify clients' identities, assess their financial profiles, and understand their investment needs and risk tolerance.

What constitutes 'false trading' under the SFA?

Answer: Creating a false or misleading appearance of active trading

False trading involves creating an artificial or misleading impression of active trading in securities, which misleads other investors.

What is the obligation of a representative when there is a conflict of interest?

Answer: Disclose the conflict to the client

Representatives must disclose any conflicts of interest to clients to ensure transparency and allow clients to make informed decisions.

What is a 'trading representative'?

Answer: A person appointed to deal in securities on behalf of a licensed firm

A trading representative is an individual appointed by a CMS licence holder to carry out regulated activities such as dealing in securities.

What is the purpose of the MAS Technology Risk Management Guidelines?

Answer: To establish standards for managing technology risks in financial institutions

These guidelines set out risk management principles and best practices for financial institutions to manage their technology and cyber risks.

How does MAS enforce securities regulations?

Answer: Through inspections, investigations, civil penalties, and criminal prosecution

MAS has a range of enforcement tools including supervisory inspections, investigations, administrative actions, civil penalties, and referral for criminal prosecution.