Financial Conduct Authority (FCA) UK Regulation Sample Exam

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What is a Statement of Principle relating to approved persons?

To act in secrecy
To act with due skill, care and diligence
To minimize operational costs
To maximize shareholder value

The correct answer is: To act with due skill, care and diligence

A Statement of Principle pertaining to approved persons is a key aspect of the regulatory framework established by the Financial Conduct Authority (FCA). It serves as a guideline for individuals working in approved roles within regulated firms, outlining the expectations and standards of conduct they must adhere to. The principle to act with due skill, care, and diligence underscores the necessity for approved persons to perform their roles with professionalism and expertise. This means that individuals must be competent and adequately trained to fulfill their responsibilities, making decisions that are informed and responsible to uphold the integrity of the financial system. This commitment to skill and diligence is crucial in ensuring that financial services are delivered efficiently, and that consumer interests are protected. It fosters an environment of accountability, where individuals understand the significance of their actions and the impact they have on clients and the broader financial market. In contrast, the other options do not align with the foundational principles guiding approved persons. Acting in secrecy does not promote transparency, minimizing operational costs does not necessarily prioritize ethical standards or consumer protection, and maximizing shareholder value may conflict with the obligation to act in the best interests of consumers. Hence, the emphasis on skill, care, and diligence is particularly pertinent to maintaining trust in the financial system.