FAIS Regulatory Exams – Important notice on approaching cut-off date
CUT OFF DATE AT 30 JUNE 2016 FOR REPRESENTATIVES APPOINTED BETWEEN
1 JULY 2013 AND 30 JUNE 2014
By Tamara Jacobsen, Director, Applied Learning Academy
FIT AND PROPER REQUIREMENTS: REGULATORY EXAMS
The minimum requirements for representatives under the Financial Advisory and Intermediary Services Act, 2002 (FAIS) are called Fit and Proper requirements. These are outlined in Board Notices issued by the Financial Services Board as part of the implementation of FAIS within the industry. According to the Fit and Proper requirements that apply to financial services providers, all key individuals and representatives must complete the level 1 Regulatory exam. The level 1 Regulatory exam focuses on FAIS and to a lesser degree, anti money laundering legislation.
Note: in terms of FAIS, brokers, call centre agents, sales representatives, financial planners/advisors and any other person who assists clients in making financial decisions on the products regulated by FAIS are called representatives.
CUT OFF DATES
According to the Board Notice issued in relation to the regulatory exams, the exam must be completed by at least 30 June following 24 completed months in the role of representative. This means that all representatives appointed in the role at any date between 1 July 2013 and 30 June 2014 must complete the regulatory exam for representatives (RE 5) by 30 June 2016.
CONSEQUENCES FOR FAILING TO MEET REGULATORY EXAM REQUIREMENTS
According to the FAIS Act and licensing conditions, financial services providers are fully responsible for their representatives, including ensuring that they meet Fit and Proper requirements. If a representative fails to meet the Fit and Proper requirements relevant to that individual, the financial services provider is supposed to debar the representative and remove that individual’s name from the representative register. Debarment and/or removal from the register means that the representative is no longer allowed to render financial services to clients.
In the event of non compliance, penalties may apply – fines imposed by the FSB’s Enforcement Committee for more minor offences start at R10 000 but are typically set at R100 000. In material cases of non-compliance, the FSPs licence may be withdrawn or suspended on the grounds of failure to comply with provisions of the FAIS Act and licence conditions.
We ask that financial services providers help their representatives to meet the regulatory exam requirements thereby meeting legal requirements, reducing risks and increasing business income.
We acknowledge that the number of representatives who need to write the exam within an organisation may not be enough to warrant the cost of a workshop, and that some employers do not provide support for their representatives. In these cases, there are other training support options that can and should be considered. Individuals who need or want to complete the exams on their own initiative are most welcome to contact us for help.
ALTERNATIVE TRAINING SUPPORT OPTIONS
Applied Learning Academy offers a wide range of services to help representatives and key individuals to successfully complete the level 1 regulatory exam including:
- Provision of an exam support pack;
- Mock exams; and
- Private tuition for representatives who have had multiple attempts at the exams without success.
Where a workshop cost is not affordable, the most cost effective and holistic support solution available in the market is Applied Learning’s regulatory exam support pack. The support pack includes:
- Summary of the material: all key information has been included in this summary for ease of study including the legal provisions and additional explanations to help with understanding;
- Summary of time periods: this document summarises the multiple time lines found in the legislation and notices. These are important to learn as questions on these arise in the exam;
- Exam tips and techniques: this provides detailed information on the exam and questions that will be asked so that study efforts are focused in the right areas. Tips and techniques on tackling the different types of multiple choice questions have also been included.
- Mock exams: two mock exams are provided on the same basis as the actual exam in terms of content, number of questions and style of questions. An answer sheet and explanations of the answers is also provided to enable the representative to use the results as a development tool to strengthen knowledge and/or exam technique.
Note: similar support is provided for the key individual level 1 regulatory exam.
► Tamara Jacobsen CFP®
► Tel | 011 452 8829
► Cell | 082 459 0993
► Website | www.appliedlearning.co.za
Applied Learning Academy
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