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FAIS Act FAIS Act and Subordinate Legislation
Under the FAIS definition of 'advice', which of the following actions by Mandla would actually amount to advice?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) He recommends that a client place an inheritance into a particular resources unit trust.Correct
- b) He buys listed shares on the exchange for his own account.
- c) He deposits the premiums a client paid into the correct policy account.
- d) He summarises the numbers in a fund fact sheet for a client but makes no recommendation.
Why this is the answer
Advice is a recommendation or proposal regarding a specific financial product made to a client. Recommending a specific unit trust for the client's inheritance is advice. Trading for one's own account, banking premiums, and merely presenting figures without any recommendation are not advice.
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