The regulation of financial markets and institutions

Linden Shares gives focused independent advice on listed shares only. Ms Ford's objectives would be better met by an accumulation product investing in funds, a market on which Linden does not advise. Following COBS 6.2B.19G, what should Linden do?

On a non-advised platform, a retail client wants to buy a complex product. The firm's appropriateness assessment of his knowledge and experience shows he does not understand its risks, but he still wants to go ahead. Under COBS 10A.3, which statement is correct?

Dalby Securities combines a client's order to buy 10,000 shares with a 10,000-share order for its own account. Only 12,000 shares are bought. Dalby cannot show that the client would have got worse terms without the combination. Under COBS 11.3.10AR, how must it allocate the shares?

A broker can buy 2,000 shares for a retail client on Venue A at 250.0p each with execution costs of £14, or on Venue B at 249.6p each with execution costs of £24. Under COBS 11.2A.9R, which venue gives the best possible result for the client?

Omar, a dealer at an investment firm, holds shares through a discretionary portfolio service run by an unconnected manager. He has no contact with the manager about any individual trade. Under COBS 11.7A.2R, how are trades made in his portfolio treated?

A professional client tells its broker to execute a large sell order on a named exchange but gives no instruction on timing or order type. Under COBS 11.2A, to what extent does the client's instruction satisfy the broker's best execution obligation?

Priya is a financial analyst whose current published research rates Kestrel plc a 'buy'. She wants to sell her own Kestrel shares. The research is public, so she has no unpublished knowledge of it. Under COBS 12.2.21R, when may she sell?

A broker's sales desk publishes a note recommending a share. The note was written without the arrangements that protect the independence of investment research. Under COBS 12.2.18R, how must the broker present the note?

A broker's investment recommendations must disclose the proportions of all its recommendations that are 'buy', 'hold', 'sell' or equivalent terms, under article 20(3) of the Market Abuse Regulation. What does FCA guidance in COBS 12.4 say about these terms?

When providing investment advice, which information must a firm obtain about its client under COBS 9A.2.1R?

Mr Dunmore asks Elmfield Advisers to recommend a fund but refuses to give any details of his income, assets or regular commitments. Under COBS 9A.2.13R, what must Elmfield do?

A firm is advising an elective professional client on products for which it is categorised as professional. Under COBS 9A.2.5R, what may the firm assume about the client?

An adviser recommends that a retail client sell one fund and buy another with a similar objective. Under COBS 9A.2.18R, what must the firm be reasonably able to demonstrate?

In which of the following situations does money that a firm holds for a client stop being client money under CASS 7.11?

Fenwick Investments' internal client money reconciliation, performed on Thursday, shows its client bank accounts hold £4,500 less than they should. Under CASS 7.15, by when must Fenwick pay in its own money to cover the shortfall?

Carlton Wealth holds shares in safe custody for its retail clients. Under CASS 6.2, which of the following must the firm do?

An external custody reconciliation at Brindley Securities shows its custodian holds 2,000 fewer client shares than the firm's records say. The firm has not concluded that anyone else is responsible. Under CASS 6.6, what must it do until the discrepancy is resolved?

Under CASS 6.6, what is the longest gap a firm may allow between external custody reconciliations of the clients' safe custody assets it holds with third parties?

Under the FCA's client money rules, in what capacity does an investment firm receive and hold the money it holds for its clients?

Morton Asset Management holds £60,000,000 of client money in client bank accounts under CASS 7.13.3R. A UK bank in Morton's own group offers to hold some of it. Under CASS 7.13.20R, what is the most Morton may deposit with that group bank at any time?

Kestrel Brokers passes a retail client's money to an overseas intermediate broker so that a trade the client has placed can settle. Under CASS 7.14.2R, which condition must also be met?

How often must a firm that holds client money carry out an internal client money reconciliation under CASS 7.15?

Under CASS 6.2.3R, in whose name should a firm normally register legal title to a client's safe custody asset that it holds?

Which of the following is MOST likely to be a mandate to which CASS 8 applies?

Henley Capital wants to deposit a client's shares with a custodian in a third country that does not regulate the safekeeping of assets for others. Under CASS 6.3.4R, when may it do so?

Mr Harland's investment manager sent him a final response rejecting his complaint and stating that it does not consent to waive the time limits. Without exceptional circumstances, by when must he refer the complaint to the Financial Ombudsman Service?

Mrs Okafor complains to her investment platform by phone on Monday. The platform resolves the complaint to her satisfaction on Wednesday of the same week, and all three days are business days. Under DISP 1.5, what must it send her?

The FCA finds that Pemberton Advisers, an authorised firm, has breached a relevant requirement, but decides not to fine it. Which power under FSMA 2000 lets the FCA publish a statement that the firm has breached the requirement?

An ombudsman upholds Ms Reid's complaint against her financial adviser and awards her £12,000. Under DISP 3.6, what is the effect if she accepts the determination by the date given in the decision?

Which of the following BEST describes the Financial Ombudsman Service's Voluntary Jurisdiction?

Hartley Investments, an authorised firm that is trading normally and is solvent, refuses to pay a client £8,000 owed after an administrative error. Will the FSCS pay the client?

Ms Cole has two claims for protected investment business against an investment firm that failed in 2026: £70,000 for unsuitable advice and £25,000 for assets that cannot be returned. What is the most the FSCS can pay her?

Mrs Hughes is unhappy with how the trustees of her occupational pension scheme calculated her benefits, and separately believes an adviser mis-sold her a personal pension. Where should each complaint go once the firms' own processes are exhausted?

Under COBS 8A.1.4R, in which of the following situations must a firm enter into a written basic agreement with its client, on paper or another durable medium?

Westmere Insurance, a per se eligible counterparty, writes to its broker asking for a higher level of protection for its bond trades but does not say which category it wants. Under COBS 3.7.3BR, how must the broker treat Westmere for those trades?

Mr Okafor, a retail client of Fenwick Wealth, asks to be treated as an elective professional client for MiFID business. He holds cash deposits and financial instruments worth EUR 640,000, worked for three years as a bond trader in a role needing knowledge of the services envisaged, and averages four significant trades a quarter. Under COBS 3.5.3R, which statement is correct?

Ashby Investments has assessed that Mrs Patel, a retail client, has the expertise to be treated as an elective professional client, and she has asked for this in writing. Which further step does COBS 3.5.3R require before Ashby re-categorises her?

Which of the following clients is a per se eligible counterparty under COBS 3.6.2R?

Corran Shipping Ltd asks a broker to execute share trades, which is MiFID business. Its latest accounts show a balance sheet total of EUR 26 million, net turnover of EUR 31 million and own funds of EUR 3 million. Assuming no other categorisation is agreed, how should the broker categorise Corran?

Fairway Advice wants to take an adviser charge of 0.5% a year out of a retail client's lump-sum investment. Under COBS 6.1A.22R, when may Fairway structure its adviser charge to be paid over time in this way?

Corbel Wealth, a stockbroker that manages no funds, issues a promotion to UK clients describing a third-party fund as 'a green choice'. Under the FCA's anti-greenwashing rule in ESG 4.3.1R, which statement is correct?

Under COBS 4.8.2R, which of the following cold calls is permitted?

A stockbroker places a magazine advert for its share-dealing account with a tear-off application form, so that readers can open an account straight away. This is MiFID business. Under COBS 4.7.-1AR, what must the advert contain?

Mr Reid, a consumer, opens a discretionary portfolio management contract online with Quayside Investments, which is a distance contract. Quayside then places dozens of trades in his portfolio over the next year. Under COBS 5.1, to what do the distance marketing disclosure rules apply?

Pennine Brokers will hold client money for a new client. Before providing MiFID services, it must give the client general information under COBS 6.1ZA.5R. Which of the following is part of that information?

Holt Financial gives restricted advice to retail clients in the UK. A fund provider offers Holt trail commission of 0.5% a year on client investments, which Holt would disclose in full. Under COBS 2.3A.15R, what is the position?

A firm communicates a written financial promotion for its MiFID discretionary management service. Under COBS 4.11.1R, for how long must it keep its record of the promotion?

Larkfield Advisers is an appointed representative of Brookdale Wealth, an authorised firm. Larkfield runs a newspaper advert for investment advice which needs no approval because of the exempt persons exemption in the Financial Promotion Order. According to COBS 4.1.3G, who must comply with the financial promotion rules for that advert?

Tamsin Asset Management launches a FTSE 100 tracker fund and wants to show how it would have performed over the last five years, using the actual returns of the FTSE 100 index. Under COBS 4.5A.12R, which condition applies to this simulated past performance?

Which body supervises UK central counterparties such as ICE Clear Europe?

A trader buys Brent crude futures on ICE Futures Europe. Once the trade is cleared, which body stands as the buyer to every seller and the seller to every buyer?

An investment firm buys shares admitted to trading on a UK regulated market for a client on Tuesday 3 November 2026. Under Article 26 of UK MiFIR, by when must it report the transaction, and to whom?

Barnes Securities executes client orders in liquid UK shares against its own book, outside any trading venue and without running a multilateral system, on an organised, frequent, systematic and substantial basis. Which pre-trade transparency obligation applies to it under UK MiFIR?

Which of the following is NOT one of the three cross-cutting obligations of the Consumer Duty in PRIN 2A.2?

A compliance officer wants the FCA's Decision Procedure and Penalties manual (DEPP) and the Supervision manual (SUP). In which block of the FCA Handbook will she find both?

Ashby Investments breaches Principle 6 in its dealings with Mrs Patel, a retail client, but breaks no more specific rule. Which statement about the consequences is correct?

Which of the following correctly matches a Principle for Businesses in PRIN 2.1.1R with its requirement?

Which of the following is a stated purpose of the Senior Management Arrangements, Systems and Controls sourcebook (SYSC)?

Ridley Partners finds that its organisational arrangements cannot ensure, with reasonable confidence, that a conflict of interest will not damage a client's interests. What does SYSC 10 require it to do before acting for the client?

Leah is a certified employee advising retail clients at Ashby Investments, a solo-regulated firm. Under the Certification Regime, who assesses whether she is fit and proper, and how long does her certificate last?

Tom advises retail clients at an authorised firm. Which individual conduct rule corresponds to the Consumer Duty in Principle 12?

Which of the following is an individual conduct rule in COCON 2.1, rather than a senior manager conduct rule in COCON 2.2?

At an FCA-authorised investment firm, which Senior Management Function in SUP 10C covers the money laundering reporting function?

Under the FCA's training and competence rules, what continuing professional development must a retail investment adviser assessed as competent complete in each 12-month period?

Priya, a retail investment adviser, was assessed as competent on 1 March 2025. Under TC 2.1.27R and 2.1.28R, how must her firm verify her qualifications, CPD and annual declarations?

An agent paid commission to win business for Crestmoor Capital, a UK company, bribes an overseas official to secure a mandate for Crestmoor. Crestmoor's board knew nothing of it. Under s.7 of the Bribery Act 2010, which is correct?

The FCA is setting a financial penalty for an individual's deliberate market abuse, carried out in his employment, under DEPP 6.5C. Which statement is correct?

In the financial year before an employee commits a fraud in 2026 intended to benefit it, Ellery Asset Management had 300 employees, turnover of £30 million and a balance sheet total of £15 million. Under the Economic Crime and Corporate Transparency Act 2023, which is correct?

Mr Grant, an analyst at a wealth manager, reviews client transactions that would give a reasonable person grounds to suspect money laundering. He does not actually suspect anything and makes no report. Under s.330 of the Proceeds of Crime Act 2002, which is correct?

The FCA is prosecuting Mr Varga in England for insider dealing. A possible market abuse case against him rests on substantially the same allegations. Under the FCA's Enforcement Guide, which is correct?

Under s.56 of the Criminal Justice Act 1993, which of the following is one of the conditions for information to be inside information?

Why does following the Joint Money Laundering Steering Group (JMLSG) guidance matter to a UK investment firm?

A financial adviser who never handles client money is asked by a new client to move funds, already spread across several bank accounts, into a series of investment bonds. According to JMLSG sector guidance, which stages of money laundering is such an adviser MOST at risk of being drawn into?

A well-known market commentator buys shares in a small company, then praises the company on a financial television programme without disclosing his holding, and sells once the price rises. Under the UK Market Abuse Regulation, this is BEST described as:

Which of the following can be a criminal offence under the Money Laundering Regulations 2017 even if no money laundering has actually taken place?

What is the maximum prison term on conviction on indictment for the principal money laundering offences of concealing, arranging, or acquiring, using or possessing criminal property under sections 327 to 329 of the Proceeds of Crime Act 2002?

Under SYSC 6.3, which of the following must a firm do in relation to its money laundering reporting officer (MLRO)?

An employee of Halden Wealth deliberately helps a client evade UK income tax. Halden is charged under s.45 of the Criminal Finances Act 2017 with failing to prevent the facilitation of tax evasion. What defence is open to Halden?

After her firm's nominated officer makes a suspicious activity report, a relationship manager tells the client about it, in a way likely to prejudice an investigation. What is the maximum sentence on indictment for this tipping-off offence under POCA s.333A?

What is the main focus of the UK Alternative Investment Fund Managers regime (AIFMD UK)?

Which statement correctly distinguishes FATCA from the Common Reporting Standard?

What is the main effect of the Financial Services and Markets Act 2023 on retained EU law relating to financial services?

Under the UK Benchmarks Regulation, which body authorises or registers UK benchmark administrators?

Which of the following funds could NOT qualify as a UCITS under section 236A of FSMA 2000?

Kestrel plc publishes its initial offer document for Tarn plc on 7 September 2026. The timetable is not extended and the Panel gives no consent to change it. By midnight on which date must all conditions be satisfied or waived, failing which the offer lapses?

Holloway Bank plc accepts deposits and is regulated by both the PRA and the FCA. Which statement BEST describes how responsibility for the bank is divided?

Which body's main responsibility, set out in statute, is identifying, monitoring and taking action to remove or reduce systemic risks so as to protect the resilience of the UK financial system?

Which pairing of body and function is correct?

Under Part III of the Regulated Activities Order 2001, which of the following is NOT a specified investment?

A certified FX salesperson at an authorised bank conducts spot FX business in line with the FX Global Code, which the FCA recognises. What is the effect of that recognition?

Mr Okafor paid £40,000 to an unauthorised firm under an agreement for it to manage his investments, made in breach of the general prohibition. The money has lost value. Under section 26 of FSMA 2000, what is his position?

After a personal recommendation at a face-to-face meeting, Mr Barnes takes out a personal pension and, separately, buys units in an authorised unit trust outside any wrapper. Under COBS 15.2.1R, which cancellation periods apply?

Ms Lowe validly cancels an advised, face-to-face lump-sum purchase of fund units. Her provider receives her cancellation notice on 3 March. Under COBS 15.3 and 15.4, which statement is correct?

Under the scope rules in DISC 1A.2, which of the following is a consumer composite investment?

The Consumer Composite Investments regime in the FCA's DISC sourcebook started on 6 April 2026, with a transitional period ending on 7 June 2027. During that period, which document may the manager of an authorised UCITS fund prepare for retail investors?

Under DISC 3, which of the following is a requirement for the product summary that a manufacturer prepares for a consumer composite investment?

Rowan Funds wants to use the 'Sustainability Improvers' label for one of its funds. Under the FCA's sustainability labelling rules in ESG 4, which of the following must apply?

Under PROD 3.2.8R, when a manufacturer identifies the potential target market for a new structured product, what must it do besides specifying the types of client the product suits?

The FCA finds serious harm from a new type of retail investment product and wants to act quickly. Under the FCA's policy in PROD 2, which is true of temporary product intervention rules?

Under COLL 6.6.20R, what must an authorised fund manager assess at least once a year for each scheme it manages?

An authorised fund's annual accounting period ends on 31 March and its half-yearly accounting period ends on 30 September. Under COLL 4.5.14R, by when must the manager publish the annual and half-yearly long reports?

Under COBS 11.5A.2R, when must a firm record the details of an initial order received from a client?

Under COBS 16A.4.1R, how often must a firm send a periodic statement to a retail client whose portfolio management agreement authorises a leveraged portfolio?