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FIC Act FIC Act Compliance (CDD, AML/CFT, Reporting)
What does 'know your client' (KYC) primarily achieve for an FSP?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) It helps verify who the client is and understand their profile, supporting both suitable advice and anti-money-laundering controls.Correct
- b) It lets the FSP avoid keeping any records.
- c) It guarantees the client will never complain.
- d) It replaces the need for a licence.
Why this is the answer
KYC/CDD establishes the client's identity and profile, underpinning suitable advice and the FIC Act's anti-money-laundering controls. It does not remove record-keeping, licensing or complaint obligations.
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