All RE5 questions
FAIS Act FAIS Act and Subordinate Legislation
An FSP ignored a Gazetted declaration that its practice was undesirable and carried on regardless. What sanction may the Act impose for that contravention?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) A fine not exceeding R10 million, or imprisonment not exceeding 10 years, or both.Correct
- b) A standing instruction that other FSPs must continue trading with it as normal.
- c) A fixed order to repair any loss within 45 days, with no other consequence possible.
- d) Automatic lapsing of every other FSP’s licence in the same category.
Why this is the answer
Continuing a practice that has been declared undesirable is an offence. The penalty provisions allow a fine of up to R10 million or imprisonment of up to 10 years (or both). The other options are invented and do not reflect the Act.
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