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Regulatory examination could be a tough nut to crack

17 March 2011 Gareth Stokes
Gareth Stokes, FAnews Online Editor

Gareth Stokes, FAnews Online Editor

In 2008 the Financial Services Board (FSB) increased the Fit and Proper requirements in the FAIS Act with regards competency. All key individuals and representatives in the financial services industry now HAVE TO complete regulatory examinations (RE) based on their roles and the product sub-categories they are responsible for. There are two levels of RE – Level I and Level II – which we briefly discuss below...

RE Level 1: If you are already active in the financial services industry (appointed or approved between 2004 and 2009) you must complete the RE Level I exam successfully by 31 December 2011! If you are entering the industry from 2010 you must complete this exam successfully within two years of your appointment or approval. The RE Level I exam is based on the regulatory framework and the regulatory role of the individual, more specifically the FAIS Act, Code of Conduct and Board Notices, as well as FICA.

RE Level 2: The second level exams are product specific, and will focus on testing your applied knowledge in relation to the specific products that you provide financial services for. If you are a key individual acting as a representative then you will have to complete the applicable exams as well! You can gain exemption from writing the RE Level II exams provided you have completed a recognised qualification approved by the FSB as “specific” to the particular product subcategory. The FSB have published a list of recognised qualifications.

How tough are the regulatory exams?

The RE could prove tougher than you think – if you fail to prepare. As we pen this newsletter a number of financial services professionals have already sat the exam. A regular FAnews Online reader recently sent some advice for those of you preparing to write the exams. And this – in a nutshell – is what he said.

Financial services providers, key individuals and representatives – stop what you are busy with immediately! Book an exam date at one of the many organisations that offer RE at your earliest convenience, purchase the required learning material from Inseta (the Insurance Sector Education and Training Authority) and begin studying! Memorise the material and then memorise it again! Depending on your learning style and existing knowledge of the FAIS Act you should be able to cover and review the study material with 12 to 24 hours of work. Spread that over a period of 1 day (not recommended) to 30 days and you won’t even lose valuable work time! Don’t view the studies as a chore, because we as responsible financial advisers are required to know the Act anyway!

The exam is a tough session to sit through. We felt that a third of the paper was exceptionally easy, with direct questions. A third of the paper was more difficult and the questions required a fair amount of lateral thinking. And the rest of the questions were the worst questions you could expect to experience – especially if your mother language is Afrikaans! But you’ll make it, don’t worry.

A thorough knowledge of the FAIS Act is essential

The questions are based on the learning material provided by Inseta (and others) with the FAIS Act and the accompanying Code of Conduct as the underlying knowledge base. And provided you are familiar with every line of the Act you’ll make it! I am talking from experience. The first item on my New Year list was RE. I booked the earliest possible exam date and arranged my study material through Inseta. Four representatives from our brokerage saw fit to write the first exam in the morning session and tackle the “key persons” exam on the same afternoon. After that we simply had to wait for our results. Each of us passed at the first attempt with scores of between 66% and 72%.

It is so frustrating to read all the e-mails and articles by people who obviously haven’t done the exams yet, or by people who have written the exams but haven’t studied for them, preferring instead to rely on general knowledge. All that we can say now is we cannot wait for RE 2! Good luck with your exams!

Where to source your exam material

Study material for RE may be sourced from the following websites:

http://www.fsb.co.za/
http://www.moonstone.co.za/
http://www.inseta.org.za/
http://www.fpi.co.za/

The approved examination bodies include:

The Financial Planning Institute (FPI)
Leselo (Institute of Bankers)
Moonstone Information Refinery
The South African Institute for Financial Markets (SAIFM)

Editor’s thoughts: We would love to hear your experiences when sitting the regulatory exams… Please add your comment below, or send it to gareth@fanews.co.za

Comments

Added by Edward Shabangu, 08 Jun 2019
For help with RE1 &, or RE5, please note that I have changed my contact numbers.
Preferably engage or contact me via whatsapp on 079 613 7208.
Please whatsapp me with your full names and province you are based in .
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Added by THABISILE, 13 Jul 2018
I want to do RE5 though im not employes by a financial institution for now. will they allow me to do it
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Added by Leena, 26 Feb 2018
Hi, I am currently not working, I do have my RE5 and my full qualification, I want to do my RE1 but moonstone requires an FSP number, how do I register without this
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Added by Precious, 18 Jul 2017
Good afternoon.I realy need assisstance.I am a representative and I dont seem to get it right in understanding RE and passing.I need a tutor for assistance in passing
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Added by Thandeka, 10 May 2017
Hi please help me i need study material for RE1 AND RE5 im writting july plzz contact 0794823020
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Added by Lynne/Nomasomi, 25 Jan 2017
If you are struggling with your RE5 (Representatives) examinations in the Port Elizabeth or surrounding areas please contact us on 0825218455/0766394979
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Added by Lynne/Nomasomi, 25 Jan 2017
If you are struggling with your RE5 (Representatives) examinations in the Port Elizabeth or surrounding areas please contact us on 0825218455/0766394979
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Added by Rhandzeka Langa, 20 Jan 2017
I wrote my RE 1 exam in 2012 with Leselo, I have trying to get hold of them so that I can be able to access my certificate, but had no success. Please assist.
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Added by Edward Shabangu, 15 Jan 2017
Are you struggling with successfully completing RE5 or RE1?

Please contact me on 076 561 7061. I may assist you.


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Added by Lee, 25 Oct 2016
Hi guys. Do they repeat any questions.?does anyone know
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Added by Sphiwe Ncube, 26 Jul 2016
I am preparing for my RE 1 exams and a bit nervous. Should you also be preparing for the exam, please contact me so we can share ideas.My email address is ncubespi@gmail.com and my mobile number is 0783366120
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Added by Zamantha5, 14 Jun 2016
Who reviews Fais Re Exam? Is it Inseta or FSB
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Added by mandy, 05 Jun 2016
Can you write the exam if one is currently unemployed
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Added by Cindy, 23 May 2016
I wrote the RE 5 exam . The questions where ridiculously set out. Could it not have been straight forward. Ambiguity, the way some questions where set. Not nice. Who ever set the paper never think about it properly. The first time I wrote in December 2015. I got 64, %, that paper was not bad at all. But the paper i wrote in may 2016 was disgusting.

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Added by Khanyisile, 16 May 2016
i wrote my RE5 last week on the 10th of May and i could say even though i haven't received my results i am positive that i passed, all you need to do is to prepare and study hard and understand.
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Added by Silibaziso, 12 Jan 2016
I am looking for a KI with RE1, 3 and 5 to be our KI. those who are qualified or interested please contact me on silibaziso@xchnge.co.za
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Added by ngwenya, 30 Dec 2014
can somebody please help me I need to get my certificate for re1
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Added by Bridgette, 24 Jul 2014
I wrote my re1 last week nd im still impatiently waiting for results....i currently working as an adviser in long term insurance i want to hv a steady basic that's y iv chosen to get qualified...wat jobs should i be looking into should i pass this exam???pls help im 8months in this insurance business but im looking for growth.
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Added by Echardt le Roux, 15 Oct 2013
I fully aggree with Yonita Marto. what a load of nonsense.I have seen my wife struggling through 5 Exams and still no positive outcome. She attended 3 two day courses and then full of hope had to sit through exams where the questions are asked so tricky that you must like a monkey puzzle out the answers. Why not ask straight forward questions. I think this could be a money making racket. My wife is in the motor industry and did the job as F&I for years. Now she had to resign from Auto Pedigree because they could not accomodate her without RE5!!!!!!!
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Added by jakes, 11 Oct 2012
My naam is Johan .ek het baie hard voorbery vir die RE eksamens maar het ge fail met 54% . togte ongelukig daroor , het yt die inseta manuals voorberei weet nie hu om te maak nie , gee net raad asb .SA
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Added by Glen, 14 Jul 2012
Hi. I need to get all the info on the FIV Act as well as FAIS urgently please?
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Added by Marilet, 08 May 2012
I started to study for my RE exam January, but with lots of time to spare I did not intend to study that hard at first. From March I Studies like mad, put in at least 4 to 5 hours a day studying and going through mock-up exams. I was very very stressed and negative, feeling that I am not understanding the work at all and when it came to the mock up questions I could not answer them correctly. When I went to write the exam on the 12th of April I shaked so much with anxiety, I wrote a full Hour and a Half, felt relieved but worries at the same time. Well a week went by and God be my witness I passes with 76% , I was so happy I cried. My advice: Study hard, make time, be relaxed when you study, make yourself a study time schedule and keep to it, study an hour and rest 15minutes.....drink some biostrath of turbovite for improved memory...and last, just give your best and you will make it!!!
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Added by Priscilla, 30 Mar 2011
I just got my results after stressing so much I got 82% I anm sooooooooooo pleased it is over
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Added by Ronel, 23 Mar 2011
Thank you Gareth for the positive feedback from your reader. I do however want to note that the INSETA Knowledge Material is available for free and can be downloaded from their website. I want to thank all participants who contributed to the INSETA Material and I hope the entire industry shows their appreciation as well - even if some found it frustrating that there were so many updates. Thank you for being so open to suggestions for improvements. To the Representatives who need to write this exam, my advise is the same as the reader quoted in the article. Prepare, prepare, prepare!! I was fortunate to be part of one of the very first exam sessions and am grateful to say that I passed on the first attempt. Even after training FAIS and FICA to a specific Insurance Sector for 3 years, it was important to overcome the "resistance" so many of us suffer. It was very clear during the preparation that you need to read the actual Legislation Extracts in context with the Knowledge Criteria set by the FSB to clearly understand the objectives. We at Capital Campus are fully committed to the objectives of these exams and should anybody need assistance during their preparation, please do not hesitate to contact us: info@capitalcampus.co.za
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Added by Bridget, 18 Mar 2011
Dit is met opgewondenheid dat ek enige terugvoer oor die RE eksamens lees. – Wat ‘n aangename verrassing om so ‘n positiewe berig te lees. Baie dankie FA Nuus. – Dit is ook die uitgangspunt van PSG Konsult om ons professionele beeld gestand te doen deur kwaliteit ondersteuning en motivering aan al die adviseurs binne PSG Konsult om die eksamens so spoedig moontlik te voltooi. PSG Konsult Akademie bied ook opleiding en ondersteuning aan individue ter voorbereiding van die RE 5. Kontak gerus academy@psgkonsult.co.za vir verdere inligting. PSG Konsult is of the opinion that professionalism in this industry is non negotiable. It is also the belief of PSG Konsult to provide quality support and motivation to all advisors within the group to do justice and maintain the professional image PSG Konsult holds.
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Added by Willem, 17 Mar 2011
As far as I am aware the Inseta material is free.
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Added by Paul Kruger, 17 Mar 2011
It is so good to hear the positive side of the story too. So often negative experiences can scare people off before they gave it a shot. If I may add a word of caution - the actual legislation is the basis for preparation, while study aids like the Inseta study material assists with understanding. The questions posed in the Inseta material are not pitched at the same level as those used in the exams and can lead to candidates underestimating the complexity of the exams. The "sylabus" is set out in the qualifying criteria, and provides direct references to where the answers can be found in the legislation.
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Added by Ayanda, 17 Mar 2011
Heard from someone who has written and passed both RE1 and RE5: " The exams are not easy - 2nd year varsity level I would say - And passing them will certainly NOT make you a better financial adviser for your client!"
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Added by Priscilla, 17 Mar 2011
I wrote the exam on 11.03.2011 and found it quite bland, so either i have aced it or failed it miserably . :) It was not difficult if you prepare you will pass.
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Added by Arnold, 17 Mar 2011
Attended a FIA workshop presented by Anton Swanepoel in preparation to the RE exams yesterday. What a breeze of fresh air this FIA workshop was. Everything is clear now thanks Anton and the FIA! Anyone criticising the process or “marching” on the FSB should first attend this FIA workshop then judge the exam after they wrote it. Let’s be professional about this like we claim to be, Professional Financial Advisors. Those organising a “toi toi” are spending study time on their efforts to drum up a position of “WE CAN’T MAKE IT" f you do not spend all your available time on preparing for the exam now you will not be here in 2012 to be sorry you did not. Spending valuable time on toi toi, constitutional testing, language moans, pass cut of percentage arguments, non representation and all that, is each one’s own choice. I recon it is time to spend your valuable time very, very wisely. Over and out! I have a practice to run and differentiating knowledge to go and prove. PS: Please stop sending me anything about the RE exams again.
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Added by Chris, 17 Mar 2011
I have written and passed both RE1 & RE5 exams with self study. Being a bit of a conformist, writing these exams were never an issue, which probably put me in the right frame of mind from the start. I also deal with a lot of independent FA's on a daily basis, and the general knowledge and attitude towards these exams are scary... My suggestions are as follows: 1. Do not confuse these exams as being similar to e.g. RFP 1-3 or CFP, it is not. 1. Get your mind right about the exams - you have to do it, do it as soon as possible. 2. Study - you will NOT passed on general knowledge. (Guaranteed) 3. Study - you are actually going to learn stuff which you have never (but should have) known before. 4. Practice good exam techniques - DO NOT SCAN the questions and answers, read and understand it thoroughly before answering. 5. Do NOT make the mistake of thinking multiple choice questions are easy. 6. The intention of the FSB with these exams is NOT to make you a better FA afterwards, but to have a better understanding of the FAIS act, and more spesifically the responsiblities of KI's and Reps. 7. Do not comment on these exams unless you have written it. Think about this... FA's who succesfully completed the exams are quite positive about the experience and the newly gained knowledge, those who haven't are not... Being negative is a personal choice.
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Added by Steven Akakios, 17 Mar 2011
Having completed both exams successfully last year I encourage all to focus on success and hard work. A positive attitude and determination will ensure you get through this milestone. Our Industry is afterall built on these tenents. Ready and focusing on RE2
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Added by clive, 17 Mar 2011
I agree with all comments above and have absolutely no problem with writing the exams. I have completed RFP 1,2 and 3 successfully in the past and now need to write RE 1 and RE 5. Will someone kindly let me know exactly what learning material to download and from where exactly. This may take some time from someone kind enough to assist but it wil be greatly appreciated. I thank you in anticipation.
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Added by JEREMY ROBERTSON, 17 Mar 2011
RE LEVEL ONE is actually 2 exams for most independent brokers, RE1 AND RE5 for regulatory information as Key individual and representative. RE LEVEL TWO can be as many as 8 exams depending on your category of licence. By the time I have finished all this I may be better qualified than most accountants and attornies, but I will definiteley be MORE REGULATED than any other profesional. And on top of this they want to reduce my commission! Then they wonder why the broker fraternity is ageing and no new blood joining. If you want to kill an industry, either tax it or regulate it to death!
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Added by Yonita Marto, 17 Mar 2011
I wrote my RE exam last week and all I can say is that it was the most difficult and disheartening exam I have ever sat through. I started studying all of the required material 2 and a half months prior to the exam and although I knew the material, it was still a very difficult exam. The majority of the questions posed were ambiguous and in my opinion if your mother tongue is not English then you will definitely struggle with these exams. There is no amount of preparation that can assist you with a language barrier and I disagree with the methods employed to pose the questions in these exams! You can make the exam questions as difficult as you like but for goodness' sake, make the questions and answers straight forward! This whole "smoke & daggers" approach is unproductive and will definitely NOT reflect the true competency of financial advisors. If you have studied and you still fail these exams, then all it means is that you were caught out by all of their tricky questions! I'm still awaiting my results and am hoping not to have to write an official letter of complaint to the FSB about all of this nonsense!
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