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Key Individual Role of the Key Individual in terms of the FAIS Act
An external compliance officer prepares an FSP's annual compliance report, which states that all representatives completed their CPD. The key individual signs it without reading it. In fact three representatives completed none. 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) Nobody is responsible, because a compliance report is an opinion and not a statement of fact.
- b) The FSP and its key individual remain responsible for what is submitted to the Authority.Correct
- c) Responsibility lies with the three representatives alone, because the CPD shortfall is theirs.
- d) Responsibility lies with the compliance officer alone, because she prepared the report.
Why this is the answer
A compliance officer monitors and reports, but the FSP is the licensee and its key individual is responsible for overseeing compliance. Signing without reading does not shift that. Providing false or misleading information to the Authority is itself a contravention, in addition to the underlying CPD failure.
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