LLQP Segregated Funds & Annuities · Component 3.2 · 25% of the exam
During implementation the agent learns that the client held a senior position in a foreign government. This means the agent must:
- make a politically exposed person determination and apply the enhanced measures required
- Bproceed normally, as public office has no bearing on any identification requirement
- Creport the client to the police before accepting any deposit into the proposed contract
- Ddecline the business outright, since such clients may not hold Canadian investment contracts
Correct answer: A) make a politically exposed person determination and apply the enhanced measures required
Politically exposed persons attract enhanced scrutiny. The agent must make the determination within the prescribed time, establish the source of the funds and wealth, and obtain senior management approval where the rules require it.
Why the other options are wrong
- BPublic office is precisely what triggers the additional obligations.
- CA determination is not a suspicion, and no report to police is required by it.
- DSuch clients may be served; the requirement is enhanced diligence, not refusal.
Exam tip
Foreign public office equals a politically exposed person determination and enhanced measures.
Common mistake
Applying ordinary identification steps to a politically exposed client.
What this tests
CISRO competency component 3.2 — Implement a recommendation adapted to the client's needs and situation — which is weighted at 25% of the Segregated Funds & Annuities module. Written against the published curriculum.
More from component 3
- A client's spouse must sign for:
- When the insurer requests additional information after the application (for example, source of wealth for a large deposit), the agent should:
- The implementation of a recommendation involving a switch from one seg fund to another within a contract requires:
- A client wishes to designate a charity as beneficiary of a segregated fund. Implementation should:
- For a deferred annuity implemented for a client, the agent should confirm:
- The agent's record of the implementation should be retained:
Practice the whole Segregated Funds & Annuities module
Timed sets weighted like the exam, and review of every question you miss. Free to start.