QUESTION: 157

As regards controls, which of the following best practices for counterparty identification is incorrect?

Amendments to customer standing data should be subject to 4 eyes control and only changed if the appropriately authorized documentation is provided.
The set up of settlement instructions and the confirmation method should be fixed when setting the first transaction.
No trading should be done without first identifying and setting up the counterparty.
Counterparty identification and setup of settlement instructions should be completed in less than 2 working days.

Answer(s): D

QUESTION: 158

Experience has shown that recourse to taped telephone conversations proves invaluable to the speedy resolution of disputes. Therefore, the Model Code recommends:

That all telephone conversations (internal and external) be taped without informing counterparties
That only conversations undertaken by dealers and brokers should be recorded
That all conversations undertaken by dealers and brokers should be recorded, together with back office telephone lines used by those responsible for confirming deals or passing payments to other institutions
That only telephone conversations between dealers and brokers be recorded

Answer(s): C

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