Test Questions CRPC Module 9 with
Complete Solutions7
Securities act of 1933 - ANSWERS-Required that new companies provide full disclosure through
the issuance of a perspective
Securities exchange act of 1934 - ANSWERS-Created the SEC and empowered the commission to
regulate exchanges and broker dealers and to require information from public companies
Investment company act of 1940 - ANSWERS-The regulation of mutual funds
Investment advisors act of 1940 - ANSWERS-Requires investment advisors to register with the
SEC
Major responsibility of FINRA - ANSWERS-Develop rules and regulations for its members as the
largest securities industry self regulating organization
Industry developments regarding fiduciary advice - ANSWERS-The fiduciary standard is a higher
standard than the suitability standard. This will increase client expectations of advisors and put
downward pressure on fees especially high fee products that have better, lower fee alternatives
available
The Gramm-Leach-Biliey act of 1999 - ANSWERS-Also known as the financial services
modernization act, repealed the part of glass Steagall that had previously prohibited financial
institutions from consolidating and offering a combination of commercial banking investment
banking and insurance services
, ERISA - ANSWERS-A direct result of concern over the safety and integrity of workers company
retirement plans
And investment professional who reads investment journals is complying with the - ANSWERS-
Duty to keep current which requires an investment professional to be up-to-date with subjects
relating to his or her job
Duty to disclose - ANSWERS-Requires an investment professional to explain the risks, even those
back by do US government.
Confidential client information - ANSWERS-May be released only to those authorized to have
access. Presumably one such situation is during a civil dispute between a CFP certificate and a
client
Duty of care - ANSWERS-Provide advice in the best interest of the client
Duty of loyalty - ANSWERS-Requires a fiduciary to always put the client interest ahead of their
own and that all actions be made solely for the benefit of the client
The suitability rule is one of the key roles of the - ANSWERS-FINRA conduct rules
Fiduciary standards versus suitability standards - ANSWERS-Fiduciaries have written disclosure
requirements where as verbal disclosures may be all it is required under the suitability standard
In 2010 daughter Frank test the SECto study the feasibility of a harmonized fiduciary standard.
In April 2018 the SEC proposed - ANSWERS-Continuing both a suitability standard for brokers
and a fiduciary standard for advisers
Complete Solutions7
Securities act of 1933 - ANSWERS-Required that new companies provide full disclosure through
the issuance of a perspective
Securities exchange act of 1934 - ANSWERS-Created the SEC and empowered the commission to
regulate exchanges and broker dealers and to require information from public companies
Investment company act of 1940 - ANSWERS-The regulation of mutual funds
Investment advisors act of 1940 - ANSWERS-Requires investment advisors to register with the
SEC
Major responsibility of FINRA - ANSWERS-Develop rules and regulations for its members as the
largest securities industry self regulating organization
Industry developments regarding fiduciary advice - ANSWERS-The fiduciary standard is a higher
standard than the suitability standard. This will increase client expectations of advisors and put
downward pressure on fees especially high fee products that have better, lower fee alternatives
available
The Gramm-Leach-Biliey act of 1999 - ANSWERS-Also known as the financial services
modernization act, repealed the part of glass Steagall that had previously prohibited financial
institutions from consolidating and offering a combination of commercial banking investment
banking and insurance services
, ERISA - ANSWERS-A direct result of concern over the safety and integrity of workers company
retirement plans
And investment professional who reads investment journals is complying with the - ANSWERS-
Duty to keep current which requires an investment professional to be up-to-date with subjects
relating to his or her job
Duty to disclose - ANSWERS-Requires an investment professional to explain the risks, even those
back by do US government.
Confidential client information - ANSWERS-May be released only to those authorized to have
access. Presumably one such situation is during a civil dispute between a CFP certificate and a
client
Duty of care - ANSWERS-Provide advice in the best interest of the client
Duty of loyalty - ANSWERS-Requires a fiduciary to always put the client interest ahead of their
own and that all actions be made solely for the benefit of the client
The suitability rule is one of the key roles of the - ANSWERS-FINRA conduct rules
Fiduciary standards versus suitability standards - ANSWERS-Fiduciaries have written disclosure
requirements where as verbal disclosures may be all it is required under the suitability standard
In 2010 daughter Frank test the SECto study the feasibility of a harmonized fiduciary standard.
In April 2018 the SEC proposed - ANSWERS-Continuing both a suitability standard for brokers
and a fiduciary standard for advisers
