Lesson 1: Spotting the Absolute
Welcome to the first rule of passing the RE5: The FSCA loves to test your attention to detail.
They don’t just test if you memorized the FAIS Act; they test if you can read a scenario like a true compliance officer. The easiest way they trip candidates up is by using what we call Absolute Words.
The “Big 5” Trap Words
When you see these words in an exam question or an answer option, your internal alarm should go off. These words change the entire legal meaning of a sentence.
- MUST: This means it is a strict legal requirement. There is no wiggle room.
- MAY: This means it is optional, or at the discretion of the FSP or the Authority.
- ALWAYS: Meaning 100% of the time, no matter what.
- NEVER: Meaning 0% of the time, no matter what.
- ONLY: Completely exclusive (e.g., “Only the Key Individual can…”).
🔥 EXAM HACK: Law is full of exceptions. If an RE5 answer option uses the word ALWAYS or NEVER, it is highly likely to be the wrong answer. Absolute statements are the most common distractors.
Let’s Look at an Example
Read the following two statements. They look almost identical, but one is a trap.
Option A A Representative must provide a client with a formal record of advice for every single interaction.
Option B A Representative must provide a client with a formal record of advice when a financial product is replaced.
The Breakdown: Option A uses the absolute concept of “every single interaction”. We know from the General Code of Conduct that a record of advice is not legally required for purely administrative queries. Therefore, Option B is the correct answer because product replacements strictly dictate a record of advice.
The Strategy
When you sit down for the exam, train your brain to physically spot words like must, may, always, and only. Ask yourself: “Is this a strict rule, or is there an exception?” If there is an exception, the absolute statement is false.
TRAP SPOTTED!
Explanation goes here.