FRE2 Mock Paper 1 — Skills, Principles & Ethical BehavioursEasier
The gentlest FRE2 mock: Consumer Duty, UK GDPR and vulnerable-customer questions dominate, with financial promotions and AML close behind. 40 marks, 60 min.
Ready when you are
The timer starts when you press the button. You can still finish after it runs out — it is there to mimic exam pressure, not to lock you out.
Free preview: the first 5 of 40 questions, with a timer to match. Unlock the full paper
Answer options are shuffled on every attempt. Your progress is saved as you go, so a refresh won't lose it.
About FRE2 Mock Paper 1
Paper 1 is the gentlest entry to FRE2, but it is also the most framework-heavy paper in the unit: Consumer Duty, SM&CR, conduct rules and fitness & propriety dominate the opening stretch before ethics, promotions, AML and data protection take over. There is almost no arithmetic — this is a recall-and-apply paper — so a weak score here is almost always a muddled framework rather than a calculation miss. The fix is learning the threes and fours cold (three cross-cutting rules, four outcomes, four vulnerability drivers) and then practising scenarios where two answers sound defensible and only one puts the customer first.
It is paper 1 of 5 in the FRE2 ramp, the Skills, Principles & Ethical Behaviours unit, sitting in the easier tier. Every question carries a written explanation.
Format, timing and pass mark
FRE2 Mock Paper 1 follows the live FRE2 format: 25 standalone questions + 3 case studies × 5 linked questions, in 60 minutes — about 90 seconds a question. Pass mark 28/40 (70%), as in the real assessment. There is no negative marking, so answer everything. 3 case studies carry linked questions: read each scenario once, carefully, before answering any part of it.
What this paper tests
The 40 questions in FRE2 Mock Paper 1 break down across 18 topic areas:
- Data protection6 questions
- Vulnerable customers6 questions
- Financial promotions5 questions
- Anti-money laundering3 questions
- Complaints3 questions
- Consumer Duty3 questions
- Conflicts & inducements2 questions
- SM&CR2 questions
- Adviser skills1 question
- Bribery & inducements1 question
- Compensation1 question
- Conduct rules1 question
- Conflicts of interest1 question
- Ethics1 question
…plus 4 further topic areas spread across the case studies.
Where candidates lose marks on FRE2 Mock Paper 1
Three traps this paper sets deliberately. Each one is a question where the wrong answer is the one most candidates would give.
Principle 12 is not a rewrite of Principles 1–11
The Consumer Duty added a twelfth Principle requiring firms to act to deliver good outcomes for retail customers. It sits alongside the existing Principles; it does not replace Treating Customers Fairly or the conduct rules. Options that treat Principle 12 as a wholesale replacement of the older regime are the classic distractors.
Cross-cutting rules are not the same as the four outcomes
The three cross-cutting rules (act in good faith, avoid foreseeable harm, enable customers to pursue their financial objectives) apply across everything a firm does. The four outcomes (products and services, price and value, consumer understanding, consumer support) are the results those rules are meant to produce. Mixing the lists — or inventing a fifth outcome — is a frequent FRE2 trap.
Most advisers are Certification staff, not Senior Managers
Under SM&CR, Senior Management Functions need prior FCA approval. A typical mortgage adviser in an authorised firm falls in the Certification Regime — fit and proper assessment by the firm, not pre-approval by the FCA. Options that put every customer-facing adviser through the Senior Manager gateway overstate the regime.
A higher procuration fee does not make a product more suitable
Where two products are equally suitable, recommending the one that pays more because it pays more is a conflict of interest, not advice. Disclose, manage, and choose on suitability — never on the fee. FRE2 rewards the answer that serves the customer, not the firm.
Deadlines win marks: 8 weeks, 6 months, 72 hours, 1 month
Complaints need a final response within eight weeks; the customer then has six months to go to FOS. A personal data breach likely to risk individuals must reach the ICO within 72 hours; a DSAR is normally answered within one month. Swapping any of those figures is an easy way to drop a mark on an otherwise straightforward question.
A worked example from FRE2 Mock Paper 1
An adviser forms a suspicion of money laundering while taking a mortgage application. What is the correct sequence?
- 1.Do not tip the customer off — tipping off is itself an offence.
- 2.Report the suspicion internally to the Money Laundering Reporting Officer (MLRO).
- 3.The MLRO decides whether to submit a Suspicious Activity Report to the NCA.
- 4.Continue the relationship only as directed — do not unilaterally confront the customer.
Answer: Report to the MLRO without tipping off; the MLRO decides on an SAR
Candidates often want to refuse the business on the spot or tell the customer why. Both tip off. The process answer — escalate to the MLRO and leave the external report to them — is the one FRE2 rewards.
Try two questions from FRE2 Mock Paper 1
These come from the free preview of this paper. Answer them, then reveal the explanation.
Consumer Duty
The Consumer Duty introduced a twelfth Principle for Businesses. It requires firms to:
- AAct to deliver good outcomes for retail customers
- BReport all customer interactions to the FCA
- COffer the cheapest product available in the market
- DGuarantee that no retail customer ever loses money
Reveal the answer
A is correct. Principle 12 is outcomes-focused: firms must act to deliver good outcomes for retail customers. It raises the bar above 'treating customers fairly' but is not a guarantee against loss or a price cap.
Consumer Duty
Which of the following is one of the three cross-cutting rules under the Consumer Duty?
- AAchieve a minimum customer satisfaction score
- BUndercut competitors' pricing wherever possible, as the Duty is chiefly a price-competition measure
- CRefer all complex cases to the FCA
- DAvoid causing foreseeable harm to retail customers
Reveal the answer
D is correct. The three cross-cutting rules are: act in good faith; avoid causing foreseeable harm; and enable and support retail customers to pursue their financial objectives. The other options are inventions.
Scored under 70%? Revise these next
A near miss is almost always a calculation you cannot do under time pressure, a definition you half-know, or a rule you have never read in the examiner's words. Start with the topic areas above where you dropped marks, then:
- →Drill the calculations on the CeMAP formula sheet — LTV, income multiples, SDLT, APRC, ERCs and rental cover, each worked through.
- →Nail the terminology in the CeMAP glossary — a surprising share of wrong answers are a term you nearly knew.
- →Re-read the syllabus coverage on the FRE2 exam guide, then sit the next paper in the ramp.
The other FRE2 mock papers
5 timed mocks for this unit, running easier → harder. Sitting the whole ramp is what moves a borderline score to a comfortable pass.