Mary has contacted ACME Investment Advisers Ltd, an investment intermediary. She indicates that she wants to invest €200,000 she has just inherited. ACME is NOT required to comply with the 'know the consumer' requirement of the Consumer Protection Code in dealing with Mary in relation to her investment, if Mary has specified to them:

• A. (i) the type of investment product
• B. (ii) the financial institution
• C. (iii) how much she wants to invest in each type with each financial institution
• D. (i) only

Answer: (D)

The main idea being tested is when the Know Your Consumer requirements can be bypassed. The Consumer Protection Code allows an exemption when a client gives explicit instructions to deal in a specific investment product, so the adviser is executing the client’s instruction rather than giving or tailoring advice. In that situation, the firm isn’t required to run the full know-your-customer/suitability check.

Here, Mary has specified the type of investment product she wants to buy. That means ACME can proceed with the transaction on her instruction without conducting the full suitability/appropriateness assessment. If she had only named the financial institution or asked how much to invest with each institution, those instructions would not constitute a simple product-specific instruction, and the Know Your Consumer obligations would still apply because the adviser would be evaluating or selecting products and allocations rather than simply executing a defined instruction.