WEDNESDAY: 19 May 2021.                  Time Allowed: 3 hours.

Answer any FIVE questions.        ALL questions carry equal marks.


1.           Outline two differences between “statute law” and “case law”.   (4 marks)

2.          Benta Limited intends to make an application to operate as a central depository agent.

Advise the company on the following:

Four types of persons who might be appointed to operate as central depository agents.    (4 marks)

Four factors that the regulator might take into account in determining whether an applicant is eligible to operate as a central depository agent.      (4 marks)

3.           In the context of the Capital Markets Authority (CMA) or the equivalent regulator in your country:

Explain four objectives of the CMA or equivalent regulator in your country.     (4 marks)

Outline four powers that the CMA or equivalent regulator in your country could use to enforce compliance with capital markets legislation and the associated regulations.    (4 marks)

(Total: 20 marks)



1.          Outline four types of market participants at the capital market in your country.     (4 marks)

2.         Describe the composition of the Board of Directors of the Central Bank of your country.      (4 marks)

3.         In the context of the law of contract:

Analyse four ways through which a contract might be frustrated.     (8 marks)

Explain four circumstances under which a plea of “non est factum” might be allowed by the courts. (4 marks)

(Total: 20 marks)



1.          With reference to the law of agency, describe three types of authority of an agent.  (6 marks)

2.         Evaluate five particulars that are contained in the legal opinion accompanying a prospectus.     (10 marks)

3.         In the context of the regulation of financial market intermediaries, explain the following terms:

Investment bank.  (2 marks)

Venture capital company.   (2 marks)

(Total: 20 marks)



1.           Define the term “dematerialisation of securities”.       (2 marks)

2.         Describe four documents required to accompany an application for approval and registration of a credit rating agency in your country.    (8 marks)

3.           Discuss five grounds for removal from office of the Director General of the Financial Reporting Centre.   (5 marks)

4.           In the context of investment funds, explain five unique characteristics of real estate investment trusts (REITs). (5 marks)

(Total: 20 marks)



1.          Discuss three circumstances under which the Capital Markets Authority (CMA), or equivalent regulator in your country, might require a securities exchange to de-list a security.   (6 marks)

2.         Describe three principles for co-operation in regulation under the International Organisation of Securities Commissions (TOSCO) objectives and principles of securities regulation.   (6 marks)

3.           In the context of governance and controls, the Board of a market intermediary is required to establish a corporate governance framework that provides strategic guidance and promotes the effective monitoring of the management and accountability of the firm.

In the context of the above statement, describe four contents of a board charter.     (8 marks)

(Total: 20 marks)



1.          Explain six sources of funds for the Criminal Assets Recovery Fund.       (6 marks)

2.         Summarise eight conditions to be satisfied by a SACCO society intending to be licensed to undertake deposit- taking business.       (8 marks)

3.           With reference to the Proceeds of Crime and Anti-Money Laundering Act (POCAMLA) 2009, or equivalent legislation in your country, explain three anti-money laundering obligations of a reporting institution.   (6 marks)

(Total: 20 marks)



1.          Explain three duties of a trustee in a collective investment scheme.     (3 marks)

Discuss three circumstances under which the trustee in  (i) above might be removed from office. (6 marks)

2.           In the context of securities transactions, explain the following terms:

Front running.      (3 marks)

Market rigging.   (3 marks)

Market manipulation.       (3 marks)

3.           Identify two professional bodies that operate in the financial services sector.     (2 marks)

(Total: 20 marks)

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