LIBF CeMAP (Certificate in Mortgage Advice and Practice) — All Questions

The Financial Conduct Authority (FCA) derives its powers principally from:

• a.The Consumer Credit Act 1974 alone, together with the voluntary lending codes issued by the trade associations
• b.The Mortgage Credit Directive
• c.The Data Protection Act 2018
• d.The Financial Services and Markets Act 2000, as amended by the Financial Services Act 2012✓

FSMA 2000, as amended by the Financial Services Act 2012, established the FCA and sets out its objectives and rule-making powers. The other statutes address specific areas such as credit, mortgages and data protection, but do not constitute the FCA.

Which of the following is one of the FCA's three operational objectives under FSMA 2000?

• a.Fixing mortgage interest rates
• b.Guaranteeing every lender a profit
• c.Securing an appropriate degree of protection for consumers✓
• d.Setting house prices

The FCA's three operational objectives are consumer protection, market integrity, and promoting effective competition in the interests of consumers, supporting its single strategic objective that markets function well (FSMA 2000, ss.1B-1E).

Under the FCA's Consumer Duty, in force from 31 July 2023, firms must:

• a.Apply the Duty only to wholesale market counterparties
• b.Prioritise shareholder returns over customer outcomes
• c.Act to deliver good outcomes for retail customers✓
• d.Treat all customers identically regardless of their needs

The Consumer Duty introduced Principle 12, requiring firms to act to deliver good outcomes for retail customers, with detailed rules in PRIN 2A and four outcomes: products and services, price and value, consumer understanding, and consumer support. It sets a higher standard than the earlier Treating Customers Fairly framework.

If an authorised mortgage adviser gives negligent advice and later becomes insolvent, an eligible consumer's claim may be protected by the Financial Services Compensation Scheme (FSCS) up to:

• a.There is no protection for advice claims
• b.£170,000
• c.£50,000
• d.£85,000✓

The FSCS protects eligible claims for home-finance advice and arranging up to £85,000 per person per firm (raised from £50,000 in April 2019). It is the compensation scheme of last resort when an authorised firm cannot meet claims made against it.

A customer who is dissatisfied with how a mortgage firm has handled their complaint, and who cannot resolve it with the firm, may refer it to the:

• a.Financial Services Compensation Scheme
• b.Bank of England
• c.Financial Ombudsman Service✓
• d.HM Land Registry

The Financial Ombudsman Service (FOS) resolves unresolved complaints between consumers and financial firms. Its service is free to consumers and its decisions are binding on the firm if the consumer accepts them. The FSCS, by contrast, pays compensation when an authorised firm has failed.

Before advising on regulated mortgage contracts, a firm must generally:

• a.Hold a banking licence from the Bank of England
• b.Be authorised by the FCA, or act as an appointed representative of an authorised firm✓
• c.Obtain planning permission
• d.Register only with HM Land Registry and the local trading standards office before giving any advice

Advising on and arranging regulated mortgage contracts is a regulated activity under FSMA 2000, so a firm must be FCA-authorised or act as an appointed representative of an authorised principal that accepts responsibility for its regulated activities.

Under Article 61 of the Regulated Activities Order, a loan is a 'regulated mortgage contract' where it is secured by a mortgage on land in the UK, the borrower is an individual or trustee, and:

• a.The property is used solely for commercial or agricultural purposes, with no dwelling situated on the land at all
• b.The borrower is a limited company
• c.The loan exceeds £1 million
• d.At least 40% of the land is used, or intended to be used, as a dwelling by the borrower or a related person✓

A regulated mortgage contract requires that at least 40% of the mortgaged land is used, or intended to be used, as or in connection with a dwelling by the borrower or a related person (RAO 2001, Article 61). Lending to companies, and most pure buy-to-let, falls outside this definition.

A buyer purchasing a flat is told the title is 'leasehold'. This means the buyer:

• a.Owns only the contents of the flat
• b.Owns nothing until the mortgage is repaid
• c.Owns the right to occupy the property for a fixed term granted by the freeholder✓
• d.Owns the land and the building on it outright and indefinitely, with no ground rent payable to anyone

Leasehold ownership gives the right to occupy the property for a fixed term under a lease granted by the freeholder, often with ground rent and service charges. Freehold, by contrast, is outright ownership of the property and land for an indefinite period.

A property is subject to both a first and a second legal charge. If the property is sold following repossession, the sale proceeds are applied:

• a.To the borrower first
• b.To the second-charge lender first
• c.Equally between the two lenders in proportion to the amounts they each advanced to the borrower
• d.To the first-charge lender in full before the second-charge lender receives anything✓

Legal charges rank in order of priority: the first charge is repaid in full from the proceeds before the second-charge lender receives anything. This is why second-charge lending carries greater risk and typically a higher interest rate.

Two co-owners hold a property as beneficial joint tenants. On the death of one owner, that owner's interest:

• a.Is sold by the lender
• b.Reverts to the freeholder
• c.Passes automatically to the surviving co-owner by the right of survivorship✓
• d.Passes under the deceased's will to a chosen beneficiary

Under a joint tenancy the right of survivorship applies: the deceased's interest passes automatically to the surviving joint tenant, outside the will. Under a tenancy in common, each owner instead has a distinct share that passes under their will or the intestacy rules.

A lender arranges a basic mortgage valuation of a property. The primary purpose of that valuation is to:

• a.Guarantee the buyer against future repair costs
• b.Set the stamp duty payable
• c.Confirm to the lender that the property is adequate security for the loan✓
• d.Give the buyer a detailed report on every defect

A mortgage valuation is carried out for the lender to confirm the property is worth enough and is suitable security for the loan. It is not a detailed condition report; a buyer wanting that should commission a RICS HomeBuyer report or a full building survey.

Where a firm gives advice on a regulated mortgage, the suitability rules in MCOB 4.7A require it to:

• a.Recommend the mortgage paying the firm the highest procuration fee, provided the customer can afford the payments
• b.Provide information but never a recommendation
• c.Recommend any mortgage the customer requests without any assessment
• d.Recommend a mortgage that is suitable for the customer, having assessed their needs and circumstances✓

MCOB 4.7A requires that, on an advised sale, the firm assesses the customer's needs and circumstances and only recommends a regulated mortgage contract that is suitable, taking account of factors such as affordability, the term, and the customer's objectives.

Under the Mortgage Credit Directive, the pre-contract disclosure document a customer must receive, illustrating the mortgage's costs and features, is the:

• a.Annual percentage rate table only
• b.Land Registry title plan
• c.European Standardised Information Sheet (ESIS)✓
• d.Consumer Duty outcomes statement

Since the Mortgage Credit Directive (in force 21 March 2016), the ESIS replaced the old Key Facts Illustration (KFI) as the standard pre-application and pre-contract disclosure document (MCOB 5A), setting out the loan's key features, costs and the APRC.

A mortgage sale may proceed on an execution-only (non-advised) basis only where:

• a.The adviser makes a recommendation but records no advice
• b.The customer has rejected advice or the sale meets the specific MCOB conditions, and no personal recommendation is made✓
• c.The customer is a first-time buyer who has confirmed in writing that they do not want to receive any form of advice at all
• d.The loan is above £500,000

MCOB restricts execution-only sales: most interactive sales must be advised, and an execution-only route is only available in defined circumstances where no personal recommendation is made and the customer positively elects to proceed without advice (MCOB 4.8A).

A mortgage financial promotion issued by an authorised firm must be:

• a.Approved by the Bank of England
• b.Clear, fair and not misleading✓
• c.Sent only to existing customers
• d.Free of any risk warnings

MCOB and the FCA's Principles require that communications and financial promotions be clear, fair and not misleading, so that customers are not given a false impression of a mortgage's costs, risks or features.

At the outset of a mortgage interview, the adviser should disclose:

• a.Only the lender's name
• b.The customer's full credit score and personal financial details to selected third-party lenders
• c.Nothing until the application is submitted
• d.The nature and scope of the service and how the adviser will be paid, including any fees✓

MCOB disclosure rules require the firm to explain, early in the process, the type of service offered (advised or execution-only, whole-of-market or restricted) and the basis of its remuneration, including any fees the customer will pay, so the customer can make an informed choice.

A central principle of the Mortgage Market Review (in force April 2014) is that:

• a.Interest-only mortgages are banned outright
• b.Borrowers may self-certify their income without evidence, provided they can show a clean credit history over recent years
• c.The lender must assess and take responsibility for whether the mortgage is affordable, verifying income✓
• d.Affordability is the borrower's sole responsibility

The MMR placed responsibility for assessing affordability firmly on the lender, requiring income to be verified and effectively ending self-certification. Interest-only lending was not banned but is only permitted where there is a credible repayment strategy.

When assessing affordability under MCOB 11, a lender must consider whether the borrower could still afford the mortgage if:

• a.The borrower moved abroad
• b.Interest rates were to rise over the early years of the mortgage✓
• c.The borrower were to win the lottery or receive a large and unexpected inheritance during the term
• d.House prices were to double

MCOB 11 responsible-lending rules require an interest-rate stress test: the lender must assess whether repayments would remain affordable if interest rates rose during the early years, rather than assuming rates stay low. Net income and committed expenditure must also be assessed.

A lender may grant an interest-only mortgage under current rules where:

• a.The borrower is over 40 years old
• b.The borrower simply hopes that house prices will rise enough to cover the outstanding capital by the end of the term
• c.No repayment plan is needed at all
• d.There is a credible, clearly understood strategy to repay the capital at the end of the term✓

Interest-only mortgages are permitted only where the borrower has a credible and clearly understood strategy for repaying the capital, such as an investment or savings vehicle. Reliance on assumed future house-price rises is not an acceptable repayment strategy.

One effect of the Mortgage Credit Directive (2016) was to:

• a.Require all mortgages to be interest-only
• b.Abolish the FCA
• c.Bring second-charge mortgages fully within MCOB and create a regime for consumer buy-to-let✓
• d.Remove all conduct regulation from first-charge residential mortgages that are sold to individual consumers

The MCD brought second-charge mortgages (previously regulated under the Consumer Credit Act) fully within MCOB, introduced the ESIS and APRC, and created a registration regime for consumer buy-to-let lending to 'accidental' landlords who are acting as consumers.

The APRC (Annual Percentage Rate of Charge) shown on an ESIS represents:

• a.The valuation fee
• b.The rate of stamp duty
• c.The total cost of the mortgage to the borrower expressed as a yearly percentage✓
• d.The lender's own profit margin only, before any fees or charges are added to the loan

The APRC expresses the total cost of the mortgage (interest plus mandatory charges) as a single annual percentage rate, helping borrowers compare deals on a like-for-like basis. The MCD also requires a second APRC illustrating the effect of higher rates.

Under a capital-and-interest (repayment) mortgage, the borrower's monthly payments:

• a.Cover interest only, leaving the capital outstanding at the end of the term
• b.Vary directly with the stock market
• c.Cover both interest and a portion of the capital, so the balance is cleared by the end of the term✓
• d.Are invested in a separate savings plan

A repayment (capital-and-interest) mortgage's payments include both interest and capital, so provided all payments are made the loan is fully repaid by the end of the term. An interest-only mortgage instead leaves the capital to be repaid separately.

An offset mortgage works by:

• a.Fixing the interest rate for the whole term so that the borrower's monthly payment never changes for the entire mortgage term
• b.Guaranteeing a cashback each year
• c.Setting the borrower's linked savings balance against the mortgage balance to reduce the interest charged✓
• d.Converting the loan into a foreign currency

An offset mortgage links the borrower's savings (and sometimes current-account) balances to the mortgage; interest is charged only on the net balance, reducing the interest cost while keeping the savings accessible. It does not fix the rate or pay cashback.

A tracker mortgage's interest rate:

• a.Moves in line with an external benchmark such as the Bank of England Bank Rate, at a set margin✓
• b.Never changes
• c.Is fixed for the life of the loan
• d.Is set at the lender's absolute discretion with no reference point

A tracker rate is a variable rate that follows a stated external benchmark, most commonly the Bank of England Bank Rate, plus a fixed margin, so the payment rises and falls with that benchmark. This differs from a lender's own standard variable rate, which the lender itself sets.

A 'discount' mortgage offers the borrower:

• a.A fixed rate for five years
• b.An interest-free loan
• c.A set reduction off the lender's standard variable rate (SVR) for a period✓
• d.A rate that tracks the Bank of England Bank Rate

A discount mortgage charges the lender's standard variable rate (SVR) less a set discount for an introductory period. Because it depends on the SVR, which the lender controls, the actual rate can move if the SVR changes.

A capped-rate mortgage protects the borrower by ensuring that the interest rate:

• a.Can fall but cannot rise above a stated ceiling during the capped period✓
• b.Rises automatically each year
• c.Is fixed for the whole term and can never change under any market conditions
• d.Always equals the Bank Rate

A capped rate is variable but cannot exceed a stated ceiling ('cap') during the capped period, giving the borrower protection against rises while still allowing the benefit of falls. A 'capped and collared' product also has a floor below which the rate cannot fall.

Where a borrower falls into arrears, MCOB 13 requires the lender to:

• a.Add unlimited charges to the account
• b.Treat the customer fairly and consider repossession only as a last resort✓
• c.Repossess the property immediately once a single monthly payment has been missed by the borrower
• d.Refuse to communicate with the borrower

MCOB 13 requires lenders to deal fairly with customers in payment difficulty, make reasonable efforts to agree a way to resolve the arrears, and treat repossession as a last resort after other options have been considered.

As a condition of a mortgage, a lender will normally require the borrower to have:

• a.Life insurance covering the lender's directors and senior managers for the duration of the loan
• b.Pet insurance
• c.Buildings insurance covering at least the reinstatement value of the property✓
• d.Travel insurance

Lenders require buildings insurance so that the property, which is their security, can be rebuilt if it is damaged or destroyed; cover must be at least the reinstatement value. Contents insurance, by contrast, protects the borrower's belongings and is optional.

A mortgage adviser who suspects that a client's application contains falsified income documents to obtain a larger loan should:

• a.Increase the size of the requested loan to help the client meet the higher purchase price they have privately agreed with the seller of the property
• b.Simply tell the client to find a different lender
• c.Ignore it if the client insists
• d.Decline to proceed and, where appropriate, make a suspicious activity report, in line with anti-money-laundering obligations✓

Submitting falsified documents is mortgage fraud. Under the Money Laundering Regulations 2017 and the Proceeds of Crime Act 2002, the adviser must not facilitate it and, where suspicion of criminal proceeds arises, must consider making a suspicious activity report (SAR) to the National Crime Agency, without tipping off the client.

Which protection product is most commonly recommended to repay the outstanding balance of a repayment mortgage if the borrower dies during the term?

• a.Decreasing term assurance✓
• b.Motor insurance
• c.Private medical insurance
• d.An annuity

Decreasing term assurance provides a sum that reduces broadly in line with the falling balance of a repayment mortgage, so it can clear the outstanding debt on death for a relatively low premium. Level term assurance is more commonly paired with interest-only mortgages, where the balance stays constant.

The 'general prohibition' means that a person must not carry on a regulated activity in the UK unless they are authorised or exempt. It is set out in:

• a.The Bribery Act 2010
• b.The Consumer Rights Act 2015, supplemented by the various voluntary lending codes issued by the banking and building-society trade associations
• c.The Mortgage Credit Directive
• d.Section 19 of the Financial Services and Markets Act 2000✓

FSMA 2000 s.19 contains the general prohibition: carrying on a regulated activity without authorisation or exemption is a criminal offence, and any resulting agreement is generally unenforceable against the customer. This is the foundation of the UK authorisation regime.

The 'financial promotion restriction' provides that a person must not, in the course of business, communicate an invitation or inducement to engage in investment or lending activity unless it is approved by an authorised person or an exemption applies. This restriction is found in:

• a.The Data Protection Act 2018
• b.Section 21 of FSMA 2000✓
• c.The Land Registration Act 2002
• d.Section 19 of FSMA 2000

FSMA 2000 s.21 restricts financial promotions: an unauthorised person's promotion must be approved by an authorised firm (which must itself have the relevant approval permission), unless exempt. This ensures that promotions meet the FCA's clear, fair and not misleading standard.

Under the UK's 'twin peaks' model of regulation, prudential supervision of banks, insurers and major investment firms is carried out by the:

• a.Prudential Regulation Authority (PRA), part of the Bank of England✓
• b.The Competition and Markets Authority, working jointly with HM Treasury and the local trading standards departments across each region
• c.Financial Ombudsman Service
• d.HM Land Registry

Since the Financial Services Act 2012, the PRA (part of the Bank of England) supervises the safety and soundness of deposit-takers, insurers and major investment firms, while the FCA regulates conduct. Larger firms are therefore 'dual-regulated'; most mortgage intermediaries are solo-regulated by the FCA.

A small mortgage brokerage that advises and arranges regulated mortgages, but does not lend or take deposits, will normally be:

• a.Solo-regulated by the FCA✓
• b.Regulated by the Bank of England's Monetary Policy Committee
• c.Regulated solely by the PRA
• d.Dual-regulated by the PRA and FCA

Firms that only carry on conduct activities such as advising and arranging, without prudential-critical activities like deposit-taking or insurance underwriting, are solo-regulated by the FCA. Only deposit-takers, insurers and PRA-designated investment firms are dual-regulated.

Before granting authorisation, and on an ongoing basis, the FCA requires a firm to meet the 'threshold conditions'. These are best described as:

• a.The minimum number of clients and the minimum volume of annual lending a firm must achieve before it may apply to the regulator
• b.The maximum interest rate a lender may charge
• c.The pass mark for the CeMAP examination
• d.The minimum standards a firm must satisfy to become and remain authorised, such as appropriate resources and suitability✓

The threshold conditions (FSMA 2000 Schedule 6 and the FCA's COND sourcebook) are the minimum standards for authorisation, covering matters such as location, effective supervision, adequate financial and non-financial resources, suitability and a viable business model. A firm must meet them continuously, not just at authorisation.

The specific regulated activities a firm is permitted to carry on are set out in its:

• a.Part 4A permission (scope of permission)✓
• b.The buildings insurance policy the firm takes out over its own offices and the professional indemnity cover held by its advisers
• c.VAT registration
• d.Land Registry title

When the FCA authorises a firm under Part 4A of FSMA 2000, it grants a permission specifying which regulated activities and which types of investment/product the firm may deal with. Acting outside the scope of that permission breaches the requirements of authorisation.

Under the Senior Managers and Certification Regime (SM&CR), individuals holding the most senior roles, such as a firm's chief executive, must be:

• a.Elected by the firm's customers
• b.Licensed by HM Land Registry
• c.Registered only with Companies House and separately listed on the local authority's register of approved financial businesses
• d.Pre-approved by the FCA to perform a Senior Management Function✓

Under the SM&CR, individuals performing a Senior Management Function (SMF) must be approved by the regulator before taking up the role and must have a Statement of Responsibilities. The regime aims to make senior individuals personally accountable for the areas they run.

Under the SM&CR certification regime, staff who are not Senior Managers but whose role could cause significant harm to customers or the firm must be:

• a.Approved directly by the FCA before starting
• b.Licensed by the local authority
• c.Certified by the firm itself as fit and proper, at least annually✓
• d.Registered directly with the Financial Ombudsman Service and re-examined by it in person before dealing with any retail customers

Certification-function staff are not pre-approved by the FCA; instead the firm itself must assess and certify them as fit and proper at least once a year. This includes many customer-facing mortgage advisers whose advice could cause significant harm.

The individual Conduct Rules under the SM&CR require that a person subject to them must, among other things:

• a.Act with integrity and pay due regard to the interests of customers and treat them fairly✓
• b.Only ever recommend the firm's most profitable product to each customer, provided that customer can technically afford the monthly payments
• c.Avoid all contact with the FCA
• d.Guarantee investment returns to clients

The individual Conduct Rules (COCON) include acting with integrity, acting with due skill, care and diligence, being open and cooperative with regulators, paying due regard to customers' interests and treating them fairly, and observing proper market conduct. They apply to almost all staff in a regulated firm.

When assessing whether an individual is 'fit and proper' to perform a controlled or certification function, a firm will consider their:

• a.Nationality only
• b.Preferred lender only
• c.Honesty and integrity, competence and capability, and financial soundness✓
• d.Their marital status, their nationality and the amount of the deposit they are personally able to put towards the purchase

The FCA's 'fit and proper' test (FIT) focuses on honesty, integrity and reputation; competence and capability (including qualifications and training); and financial soundness. Firms must assess this before appointment and on an ongoing basis.

The FCA's SYSC sourcebook is primarily concerned with:

• a.Registering land and legal charges at HM Land Registry and dealing with the conveyancing paperwork on behalf of the borrower
• b.A firm's senior management arrangements, systems and controls✓
• c.The wording of mortgage deeds
• d.Setting stamp duty rates

SYSC (Senior Management Arrangements, Systems and Controls) requires firms to organise and control their affairs responsibly and effectively, with adequate risk management, compliance, record-keeping and governance. It supports Principle 3, that a firm must take reasonable care to organise its affairs responsibly.

The FCA's Principles for Businesses (PRIN) are:

• a.Optional guidelines that firms are free to ignore whenever complying with them would be inconvenient or reduce their profit margin
• b.A list of approved lenders
• c.Rules that apply only to unauthorised firms
• d.High-level, fundamental obligations that underpin the detailed rules and apply to authorised firms✓

The Principles for Businesses are fundamental, high-level obligations (for example integrity, skill/care/diligence, management/control, and customers' interests). Breaching a Principle is itself actionable by the FCA, even where no more detailed rule has been broken.

Principle 6 of the FCA's Principles for Businesses states that a firm must:

• a.Lend only to homeowners
• b.Never communicate with the regulator and instead deal with all supervisory correspondence through the firm's external solicitors only
• c.Maximise its own profit
• d.Pay due regard to the interests of its customers and treat them fairly✓

Principle 6 requires firms to pay due regard to the interests of their customers and treat them fairly - the basis of the 'Treating Customers Fairly' (TCF) framework. For most retail business this has been reinforced by Principle 12 and the Consumer Duty.

The FCA's Consumer Duty is built around four specified outcomes. These are products and services, price and value, consumer understanding and:

• a.Consumer support✓
• b.Advertising spend
• c.Branch numbers
• d.Shareholder value

The Consumer Duty's four outcomes are: products and services (fit for the target market), price and value (fair value), consumer understanding (clear communications) and consumer support (meeting customers' needs). They sit under Principle 12 and PRIN 2A.

The three 'cross-cutting rules' that support the Consumer Duty require firms to act in good faith, avoid causing foreseeable harm and:

• a.Charge the same fee to everyone
• b.Only sell to existing customers
• c.Guarantee a profit to every customer and compensate any customer whose investment or property does not increase in value over the term
• d.Enable and support customers to pursue their financial objectives✓

The three cross-cutting rules under the Consumer Duty are: act in good faith, avoid foreseeable harm, and enable and support retail customers to pursue their financial objectives. They shape how firms must deliver the four outcomes.

Under the Consumer Duty's 'price and value' outcome, a firm must ensure that:

• a.Its products are always the very cheapest available anywhere in the market, even where that would make the product unprofitable to run
• b.It never charges any fees
• c.Prices are set by the Bank of England
• d.There is a reasonable relationship between the price a customer pays and the benefit they receive (fair value)✓

The price and value outcome does not require the lowest price; it requires fair value - a reasonable relationship between total price and the benefits of the product or service. Firms must carry out and evidence a fair-value assessment.

The maximum binding award the Financial Ombudsman Service (FOS) can require a firm to pay, for complaints about acts or omissions on or after 1 April 2019, is (subject to periodic review):

• a.£430,000✓
• b.£1,000,000
• c.Unlimited
• d.£25,000

The FOS's higher award limit is £430,000 for complaints about acts or omissions on or after 1 April 2019 (a lower limit applies to earlier events). The limit is index-linked and reviewed periodically, so the current figure should always be checked. The ombudsman can recommend more, but only up to the limit is binding.

A key feature of the Financial Ombudsman Service is that its decision is:

• a.Binding on the firm if the consumer accepts it, but the consumer remains free to reject it and go to court✓
• b.Only advisory and binding on no one
• c.Automatically enforced by HM Land Registry
• d.Binding on the consumer but not on the firm, so the firm may simply decline to pay any award that the ombudsman decides to make

If the consumer accepts a final FOS decision it becomes binding on the firm and enforceable through the courts. If the consumer rejects it, they are not bound and may still pursue the matter in court. The service is free to consumers.

The general time limit for referring a complaint to the Financial Ombudsman Service is:

• a.There is no time limit at all
• b.One calendar month from the event complained of, with absolutely no exceptions permitted whatever the consumer's personal circumstances
• c.Twenty years from the event in every case
• d.Six years from the event complained of, or (if later) three years from when the consumer knew or ought reasonably to have known they had cause to complain✓

Under DISP, the FOS can normally only consider a complaint made within six years of the event, or if later within three years of the consumer becoming aware (or reasonably ought to have been aware) of cause for complaint. Separately, the consumer usually has six months from the firm's final response to refer the matter.

Under the FCA's DISP complaint-handling rules, a firm must send the complainant a final response (or explain why it cannot yet do so) within:

• a.Two years
• b.Eight weeks of receiving the complaint✓
• c.24 hours
• d.Ten working days in all cases, regardless of the seriousness or complexity of the complaint or the amount of money involved

DISP requires a firm to resolve or issue a final response within eight weeks of receiving a complaint. If it cannot, it must explain why and tell the complainant of their right to refer the matter to the Financial Ombudsman Service.