CELE SQE

Review Your SQE 1 Practice Records

Examination Timing: 00H15M17S

You have a broad client base including large companies, small companies, sole traders, trustees, and individuals. Under Rule 5(3) of the SRA Financial Services (Scope) Rules 2001, a solicitor must not advise a client to buy a security or relevant investment from a person whose business it is to buy and sell such investments.

Which of the following best describes when this prohibition will apply?

Where the client is a corporate client who wishes to buy shares in a company.

Where the client is an individual acting in the course of a business.

Where the client is acting in his capacity as trustee of an occupational pension scheme.

Where the client is a 'lay individual' client who requests advice on the purchase of debentures.

Where a corporate client acts as trustee of an occupational pension scheme.

< Previous

You have chosen the incorrect answer.
Your selected option: C

Next >

The prohibition in Rule 5(3) of the Scope Rules applies specifically to advising a 'lay individual' (i.e., non-corporate) client on the purchase of securities, such as debentures. This rule aims to protect individual clients who may not have the same level of financial sophistication as corporate clients or trustees managing pension schemes.

Key Point: This question evaluates the understanding of Rule 5(3) of the SRA Financial Services (Scope) Rules 2001 and its application to different types of clients in relation to investment advice.

Collect Question

Financial ServicesUnit 3Chapter 4: The Financial Services Regulatory

userContent

Ai Content

Next Question

CELE SQE Education

Review Your SQE 1 Practice Records