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Unit Standard No.12164Page 91

WHAT ARE THE MINIMUM REQUIREMENTS NEEDED TO BE LICENSED?  

In order to be licensed, Providers (both FSP’s and their representatives) must prove that they are “Fit and Proper” in terms of the Determination of Fit and Proper requirements.  This means that they have to comply in four different areas:

An easy way to remember the following is using the acronym SHOC.

1.

SOUND FINANCIAL SECURITY

This refers to the financial soundness of the Financial Services Provider and Representative and clearly states that:

The Provider may not be an unrehabilitated insolvent, or

In the case of an FSP II or III, that the assets of the FSP must exceed its liabilities.

2.

HONESTY & INTEGRITY

The Determination is quite clear that the following will determine the Honesty and Integrity of the Provider:

2. (1) An applicant must be of good character and integrity.

(2) In determining whether the applicant is of good character and integrity, the registrar may refer to any information in possession of the registrar or brought to the registrar’s attention.

(3) Without prejudice to the generality of subparagraphs (2) and (4) of this paragraph any of the following factors is prima facie proof that the applicant does not comply with subparagraph (1), namely that the applicant-

(a) has within a period of five years preceding the date of application been found guilty in any civil or criminal proceedings by a court of law or other competent authority (whether in the Republic or elsewhere) of having acted fraudulently, dishonestly, unprofessionally, dishonourably or in breach of a fiduciary duty;

(b) has within a period of five years preceding the date of application been fined or censured by, or denied membership due to disqualification of, any professional or financial services industry body (whether in the Republic or elsewhere), recognised by the Board, on account of any act of dishonesty, negligence, incompetence or mismanagement;

(c) has within a period of five years preceding the date of application been fined or censured by any regulatory body (whether in the Republic or elsewhere), recognised by the Board, or that the applicant’s authorisation to carry on business has been refused, suspended or revoked by any such body, because of negligence, incompetence or mismanagement; and

INSMAT final materials31/10/03

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