Complete exam guide for University of Law PSC Financial and Business skills. Provides a step by step structure for each questions and example questions. I received a distinction.
Question 1: The General Prohibition – S.19 FSMA (16
Marks/30mins)
PART A: IS A REGULATED ACTIVITY BEING CARRIED OUT?
S.19 FSMA: No person may carry on a regulated activity in the United Kingdom, or purport
to do so, unless he is authorised or exempt.
1. Is the firm of solicitors in business? Always yes.
A regulated activity must be “carried on by way of business”. The firm is in business because
it is providing a service to a client.
2. Is there a specified investment? What category do they fall within?
Specified Investments for FSMA purposes
Securities Relevant investments
Stocks and Shares All insurance contracts
Bonds and debentures Options
Guilts Futures
Warrants Contracts for difference
Shares in investment trusts Rights under funeral plan contracts
Units in unit trusts and shares in an
OEICs
Personal and stakeholder pensions
Government stock
Equities
Stocks and shares ISA
Regulated mortgage contracts Contractually based investments
Mortgage contracts IF 40% of the Qualifying contracts of insurance:
area of the property is used for whole life (insurers for the whole
residential purposes life), endowment (guaranteed
Regulated home finance transactions payout on a fixed date) and
Home reversion plans (equity annuities (individual pays a capital
release) sum to an insurance company in
Home purchase plans return for income payments for the
Regulated sale and rent back rest of their life)
agreements Options
Consumer credit/hire agreements Futures
Consumer loans Contracts for difference
Credit cards Rights under funeral plan contracts
Buy now pay later schemes
Not specified investments for FSMA purposes
Cash – bank accounts, proceeds of sale, cash ISAs
Land
Unregulated mortgage contract (e.g. commercial property)
National savings products (incl. premium bonds)
Chattels
Commercial borrowing
Occupational borrowing
Options over land
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