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100+ Free CeMAP Module 1 Practice Questions

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Key Facts: CeMAP Module 1 Exam

70%

Pass Mark Per Unit

Walbrook Institute London / LIBF

2 units

FRE1 and FRE2

CeMAP Specification Sept 2025

40

Questions Per Unit

CeMAP Specification Sept 2025

1 hour

Time Per Unit

CeMAP Specification Sept 2025

£120,000

FSCS Deposit Limit (Dec 2025)

PRA / FSCS

£445,000

FOS Maximum Award

Financial Ombudsman Service

CeMAP Module 1 (FSRE) is examined in two units, FRE1 and FRE2, each containing 25 standalone multiple-choice questions plus 3 case studies of 5 linked questions, sat online via Brightspace in 1 hour with a 70% pass mark per unit. FRE1 covers the UK financial services industry, the FCA, PRA, Bank of England, FOS, FSCS, providers, advice channels, anti-money laundering, consumer credit and data protection. FRE2 covers conduct of business and the Consumer Duty, ethics, consumer protection, taxation, product basics (savings, investment, protection, pensions) and state benefits. Both units must be passed to complete Module 1. This is a Level 3 knowledge exam; this free prep mirrors that format.

Sample CeMAP Module 1 Practice Questions

Try these sample questions to test your CeMAP Module 1 exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1Which UK body is the prudential regulator responsible for the safety and soundness of banks, building societies, credit unions and large insurers?
A.The Financial Conduct Authority (FCA)
B.The Financial Ombudsman Service (FOS)
C.The Prudential Regulation Authority (PRA)
D.The Financial Services Compensation Scheme (FSCS)
Explanation: The PRA, part of the Bank of England, is the prudential regulator and promotes the safety and soundness of the firms it authorises, focusing on capital, liquidity and resilience. The FCA is the conduct regulator. This is the dual-regulation 'twin peaks' model.
2From 1 December 2025, what is the FSCS deposit protection limit per eligible depositor, per authorised institution?
A.£75,000
B.£85,000
C.£100,000
D.£120,000
Explanation: Following PRA rules effective 1 December 2025, the FSCS deposit protection limit increased from £85,000 to £120,000 per eligible depositor per authorised firm. Banking licences are shared across brands, so the limit applies per institution, not per account.
3A consumer is dissatisfied with how a regulated firm handled their complaint. Which body provides a free, independent service to resolve the dispute without going to court?
A.The Financial Conduct Authority
B.The Prudential Regulation Authority
C.The Financial Ombudsman Service
D.The Competition and Markets Authority
Explanation: The Financial Ombudsman Service (FOS) settles individual disputes between consumers and financial firms free of charge to the consumer. A complaint can be referred to FOS once the firm has issued its final response or eight weeks have passed.
4Which institution sets the UK base interest rate and is responsible for monetary policy and financial stability?
A.HM Treasury
B.The Debt Management Office
C.The Financial Conduct Authority
D.The Bank of England
Explanation: The Bank of England is the UK's central bank. Its Monetary Policy Committee sets Bank Rate to meet the Government's inflation target, and its Financial Policy Committee monitors financial stability. The PRA sits within the Bank of England.
5A mutual organisation owned by its members and traditionally focused on savings and mortgage lending best describes a:
A.Retail bank
B.Unit trust
C.Building society
D.Credit reference agency
Explanation: A building society is a mutual institution owned by its members (savers and borrowers) rather than shareholders. Its main business is taking retail deposits and providing residential mortgages, governed by the Building Societies Act 1986.
6Under the FCA's regime, what is the maximum total time a firm normally has to issue a final response to a complaint before the consumer can refer it to the Financial Ombudsman Service?
A.4 weeks
B.12 weeks
C.8 weeks
D.6 months
Explanation: Under FCA DISP rules, a firm has up to eight weeks to issue a final response to a complaint. If it does not, or the consumer is dissatisfied with the response, the consumer may refer the complaint to FOS, usually within six months of the final response.
7Which piece of legislation is the principal statute giving the FCA and PRA their regulatory powers over financial services in the UK?
A.The Consumer Credit Act 1974
B.The Data Protection Act 2018
C.The Financial Services and Markets Act 2000
D.The Building Societies Act 1986
Explanation: The Financial Services and Markets Act 2000 (FSMA), as amended, is the principal framework legislation under which the FCA and PRA are established and derive their powers, including authorisation, supervision and enforcement.
8What is the primary purpose of the Money Laundering Regulations and the Proceeds of Crime Act 2002 for a regulated firm?
A.To guarantee customer deposits
B.To set the level of interest rates
C.To prevent firms being used to launder the proceeds of crime
D.To regulate the format of advertisements
Explanation: Anti-money laundering law requires firms to carry out customer due diligence, monitor transactions and report suspicions to prevent criminals disguising the proceeds of crime as legitimate funds. POCA 2002 creates the offences and the duty to report.
9In the customer due diligence process, what does 'Know Your Customer' (KYC) primarily require a firm to do?
A.Guarantee the customer a minimum investment return
B.Provide the customer with free legal advice
C.Insure the customer's deposits
D.Verify the customer's identity and understand the nature of the relationship
Explanation: KYC is the foundation of customer due diligence: firms must verify a customer's identity, understand the purpose of the relationship and assess money-laundering risk. Enhanced due diligence applies to higher-risk customers such as politically exposed persons.
10If a firm employee suspects money laundering, to whom must they report internally before any report is made to the National Crime Agency?
A.The Financial Conduct Authority
B.The Financial Ombudsman Service
C.The Money Laundering Reporting Officer (MLRO)
D.The customer's solicitor
Explanation: Staff must make an internal Suspicious Activity Report to the firm's Money Laundering Reporting Officer (MLRO), who decides whether to submit a SAR to the National Crime Agency. 'Tipping off' the customer is a criminal offence.

About the CeMAP Module 1 Exam

CeMAP Module 1, the Financial Services, Regulation and Ethics (FSRE) module, is the first module of the UK CeMAP mortgage-adviser qualification. Under the September 2025 structure it has two units, FRE1 and FRE2, each assessed by 25 standalone MCQs plus 3 case studies of 5 linked MCQs in one hour, with a 70% pass mark per unit.

Questions

40 scored questions

Time Limit

1 hour per unit (FRE1 and FRE2)

Passing Score

70% per unit

Exam Fee

Enrolment fee set by Walbrook Institute London (formerly LIBF) per registration; no single fixed public figure (Walbrook Institute London (formerly LIBF) via Brightspace)

CeMAP Module 1 Exam Content Outline

50%

FRE1: Industry, Regulation and Key Parties

UK financial services industry, the FCA, PRA, Bank of England, FOS and FSCS, product providers, advice channels, authorisation, anti-money laundering, consumer credit and data protection.

50%

FRE2: UK Financial Services and Regulation in Practice

Conduct of business and the Consumer Duty, ethics and integrity, consumer protection, taxation, savings, investment, protection and pension product basics, and state benefits.

How to Pass the CeMAP Module 1 Exam

What You Need to Know

  • Passing score: 70% per unit
  • Exam length: 40 questions
  • Time limit: 1 hour per unit (FRE1 and FRE2)
  • Exam fee: Enrolment fee set by Walbrook Institute London (formerly LIBF) per registration; no single fixed public figure

Keys to Passing

  • Complete 500+ practice questions
  • Score 80%+ consistently before scheduling
  • Focus on highest-weighted sections
  • Use our AI tutor for tough concepts

CeMAP Module 1 Study Tips from Top Performers

1Use only study materials updated for the September 2025 FRE1/FRE2 structure; ignore older guides that reference 'Unit 1', 'Unit 2' or 'UKFR'.
2Practise case-study questions specifically, because each unit includes three case studies of five linked questions that test applied judgment.
3Memorise key current figures: 70% pass mark, £20,000 ISA allowance, £12,570 personal allowance, £3,000 CGT exemption, FSCS limits and the FOS award limit.
4Learn the roles of the FCA, PRA, Bank of England, FOS and FSCS precisely, as candidates often confuse the conduct and prudential regulators.
5Study ethics and the Consumer Duty as applied scenarios rather than definitions, since FRE2 rewards judgment about acting in the client's best interest.
6Sit FRE1 and FRE2 close together so regulatory knowledge stays fresh, but only book each unit once you score consistently above 70% in mocks.

Frequently Asked Questions

What is CeMAP Module 1?

CeMAP Module 1 is the Financial Services, Regulation and Ethics (FSRE) module, the first of three modules in the UK CeMAP mortgage-adviser qualification awarded by Walbrook Institute London (formerly LIBF). It covers the UK financial services industry, regulation, ethics, taxation and product basics.

How is CeMAP Module 1 structured under the 2025 changes?

From September 2025, Module 1 is split into two units, FRE1 and FRE2. Each unit has 25 standalone multiple-choice questions plus 3 case studies of 5 linked questions, sat online via Brightspace in one hour.

What is the pass mark for CeMAP Module 1?

Each unit, FRE1 and FRE2, must be passed separately with a score of at least 70%. Both units must be passed to complete Module 1.

How many questions are in each CeMAP 1 unit?

Each unit contains 40 questions: 25 standalone multiple-choice questions and 3 case studies, each with 5 linked multiple-choice questions.

Can I sit FRE1 and FRE2 in any order?

Yes. FRE1 and FRE2 can be sat in either order, although many candidates take FRE1 first because it establishes the regulatory landscape that FRE2 builds on with conduct and ethics.

What topics does CeMAP Module 1 cover?

FRE1 covers the financial services industry, the FCA, PRA, Bank of England, FOS, FSCS, providers, advice channels, anti-money laundering, consumer credit and data protection. FRE2 covers conduct of business, the Consumer Duty, ethics, taxation, savings, investment, protection and pension basics, and state benefits.

Is CeMAP Module 1 taken online?

Yes. Under the new structure, Module 1 exams are sat online through the Brightspace platform, with the revised specification rolled out from September 2025.

Do CeMAP Module 1 figures use current UK tax and protection limits?

Yes. Candidates should know current UK figures such as the 70% pass mark, the £20,000 ISA allowance, the £12,570 personal allowance, and protection limits including FSCS deposit cover, which rose to £120,000 from December 2025, and the FOS maximum award of £445,000.