CS Professional · IFSCA - Regulations, Listing and Compliances · Capital Market Intermediaries
Rohan Brokers, an IFSCA-registered intermediary, discovers that one of its employees has mis-sold a product to a client and that the matter amounts to a breach of IFSCA requirements. Which course best fits the general obligations of a registered intermediary?
The intermediary should investigate, take corrective steps, keep records and report or disclose the breach to IFSCA as required. Hiding the matter, settling privately off record or merely dismissing the employee fails the duties of compliance, record-keeping and cooperation with the regulator.
- AWait to see whether the client complains before taking any action
- BSettle privately with the client and keep the matter off its records
- CInvestigate, take corrective action and make the required reporting or disclosure to IFSCA, while maintaining records of the matterCorrect
- DDismiss the employee and treat the matter as closed with no disclosure
Explanation
Registered intermediaries must maintain compliance systems, cooperate with the regulator and report breaches as required. Concealing the issue or ignoring it breaches those duties. Disciplining the employee alone does not discharge the reporting duty.
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