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Conflicts of Interest Code of Conduct
Which of these would breach the requirement to avoid or manage conflicts of interest?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) Keeping a gifts register
- b) Recommending an in-house fund only where it is the most suitable option
- c) Steering every client into a better-paying in-house fund, undisclosedCorrect
- d) Disclosing in writing that the FSP earns more on its in-house fund
Why this is the answer
Pushing all clients into a more profitable in-house product regardless of suitability, and without disclosure, is an unmanaged conflict. Disclosing the interest, recommending in-house products only where they are most suitable, and recording gifts are all ways of managing conflicts.
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