Outside activities
- 1. Know-your-client (KYC) & Suitability
- Calculators and Scratch Paper
- The Relationship the Rules Describe
- Clients Who Live Somewhere Else
- What KYC Has to Cover
- Tolerance, Capacity and Need
- Business Structures and Why They Change the Answer
- Writing It Down, and Having the Client Confirm It
- The Trusted Contact Person, and the Temporary Hold
- Who Owns KYC, and How Current It Has to Be
- What the Client File Holds
- Account Appropriateness
- The Account Types You Have to Compare
- What the Account-opening File Needs
- The Relationship Disclosure Document
- Keeping Confidential Information Contained
- The Welcome Package
- Product Due Diligence and Knowing the Product
- The Suitability Determination
- Unsolicited and Unsuitable Instructions
- Investment Actions
- Why Appropriateness and Suitability Are Separate Tests
- Monitoring, Triggering Events and Change
- Conflicts of Interest
- Outside Activities
- Personal Financial Dealings with Clients
- Standards of Conduct
- A Client, Worked End to End
- Twelve Ways to Lose Marks on This Element
- Fifteen Terms to Own
- One Item From CIRO's Practice Exam
Know-Your-Client (KYC) & suitability
Outside activities
An is a business, role or engagement a representative holds beyond the dealer. A directorship, a side business, paid teaching, a consulting arrangement.
The rule is not about whether the activity touches securities. That is the misconception the exam tests. The requirement is pre-approval: the representative discloses the activity and obtains the dealer's written consent before it starts, because the dealer has to assess the conflict, the time commitment, and the reputational exposure.
A directorship in a private company with no connection to securities still needs disclosure and written consent. A paid speaking engagement at a client's company still needs it. The test is the activity, not the subject matter.