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Key Individual Role of the Key Individual in terms of the FAIS Act
The Authority withdraws its approval of a key individual. The FSP's board wants him to keep running the advice division 'in an advisory capacity' while it looks for a successor. Which statement is correct?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) He may no longer take part in managing or overseeing the financial services business, whatever his title.Correct
- b) He may continue, because the withdrawal affects his status with the Authority and not his employment.
- c) He may continue for up to six months, which is the period allowed for replacing a key individual.
- d) He may continue, provided another approved key individual signs off his decisions each month.
Why this is the answer
Only a person approved by the Authority may take part in the management or oversight of an FSP's financial services activities. Once approval is withdrawn he may not perform that function, and a change of title does not change the function. There is no grace period, and nominal sign-off by another person does not make it lawful.
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