CMFAS RES 1A Licensing & Business Operations question: the representative-notification framework

CMFAS RES 1ALicensing & Business Operations

Which statements about the representative-notification framework are CORRECT? (a) The principal lodges a notification with MAS before the individual starts. (b) The individual is separately licensed by MAS. (c) The individual appears on the Public Register of Representatives. (d) The individual must meet fit-and-proper and competency requirements. Which of the following are CORRECT?

A (a), (c) and (d) only
B (b) only
C (a) and (b) only
D (a), (b), (c) and (d)

Show the answer and explanation

Answer: A. (a), (c) and (d) only

Since 2010 representatives are notified by their principal and listed on the Public Register; they are not separately licensed, but must be fit and proper and meet the competency (CMFAS) requirements.

Common mistake

Notified and registered, not licensed.

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Vega Capital, a CMS licence holder, enters into an OTC swap with a corporate customer on Tuesday, dealing as principal. On Wednesday it sends the customer a confirmation stating Vega's name, the customer's name, the date the transaction was entered into, and the type and notional value of the contract. The confirmation says nothing about the capacity in which Vega dealt. What must Vega do?Which of the following persons are exempt from holding a CMS licence for dealing in capital markets products?Which of the following is NOT generally regarded as an exempt financial institution able to conduct regulated activities without a CMS licence?

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