Definition of "persons" under the Uniform Securities Act - ANSWER Governments,
government agencies, human beings
What is not considered a person under the USA? - ANSWER An equitable interest in a
corporation
Terms that describe persons who are human beings under the USA - ANSWER natural
persons, individuals
The model law that most states have adopted as the basis for their securities regulations -
ANSWER Uniform Securities Act (USA)
Definition of the term "state" under the USA - ANSWER any state, territory, or possession
of the United States
All persons who are state securities-registered must renew their registrations each -
ANSWER Dec 31
How state registration fees are assessed under the USA - ANSWER annually, not pro-rated
for partial years
Upon the merger of a broker-dealer with another firm, when the state registration fee is due
- ANSWER A fee is assessed on the next Dec 31; the surviving firm receives a carry-over
registration and does not pay a fee at the time of the merger
1
,Under the USA, agents of two firms that merge retain their registration and are associated
with - ANSWER the successor firm
The type of client notification required when a registered person changes his/her firm
association - ANSWER None. Information does not need to be sent to clients. However,
the change must be promptly updated with the Administrator.
When a registered person must notify the Administrator about any changes to information
in his/her registration, such as firm association or address - ANSWER Promptly
State registration requirements for fingerprints and character affidavits consists of -
ANSWER no requirements; fingerprints and character affidavits are not required with
registration at the state level
The type of convictions that can result in statutory disqualification of a state registration -
ANSWER conviction for any felony in the past 10 years and conviction of any securities-
or money-related misdemeanor in the past 10 years
Regulatory action that can result in a statutory disqualification from registration -
ANSWER An injunction by the SEC, state securities Administrator, or self-regulatory
organization
During an application for securities registration, a personal bankruptcy must be reported if it
occurred during - ANSWER the past 10 years; bankruptcy is not a statutory
disqualification, but it must be disclosed
When a personal bankruptcy can be grounds for denying or revoking a securities registration
- ANSWER when the applicant is currently insolvent (bankrupt)
The period during which a state Administrator may suspend or revoke a registration based
on information submitted on an application - ANSWER only during the first 90 days of
2
,registration (after 90 days, inaccuracies in the application cannot be used to justify a denial
of registration)
When an application for securities registration normally become effective - ANSWER
noon, 30 days after filing (however, the Administrator may accelerate or delay effectiveness)
The time period during which an agent can continue doing business with a client under an
existing state registration, after that client moves to a new state - ANSWER 30 days
The type of state registration or renewal application that must include a consent to service
of process - ANSWER only the initial registration, not renewals
The scope of the permission granted by an agent under a consent to service of process -
ANSWER The agent agrees to accept service on civil actions related to the securities
industry. The consent does not include criminal actions or civil actions outside the industry
The impact of a broker-dealer's registration suspension on its registered employees is -
ANSWER all registrations of its employees are suspended until the firm's registration is
reinstated
The jurisdiction of FINRA in registering Investment Advisors is - ANSWER None. The SEC
and state register and regulate Investment Advisors
Obtaining state registration with an Administrator means that a broker-dealer has qualified
to - ANSWER lawfully sell securities in the state of registration
The role of the Administrator in verifying the truth and accuracy of a broker-dealer's
registration filing is - ANSWER None. The administrator does not imply that the
registration is true and accurate-only that the firm has made sufficient disclosure to sell
securities
3
, A broker-dealer can charge a client for a service only when - ANSWER the service has
been performed (not when it is promised, requested, or contracted)
The situation in which a broker-dealer can charge a client a mark-up is when - ANSWER it
is selling securities from its own account, acting as a principal
The situation in which a broker-dealer can charge a client a mark-down is when -
ANSWER it is buying securities from its own account, acting as a principal
A broker-dealer charges customers mark-ups and mark-downs when trading securities as -
ANSWER a principal (for its own account)
A broker-dealer can charge customers trading commissions when trading securities as -
ANSWER an agent (i.e. matching the customer with a buyer or seller on the other side of
the trade)
A broker-dealer is allowed to charge a customer both a commission and a mark-up on the
same trade in what circumstances? - ANSWER Never
A student who sells US Treasury bonds to other students must register as a broker-dealer
because - ANSWER treasuries are securities. Entities that sell securities in the US must be
registered as broker-dealers, or as registered agent of broker-dealers
A broker-dealers application for securities registration must disclose these employees'
salaries - ANSWER Never. The application need not include salaries of officers, directors,
or employees
For purposes of meeting registration requirements, firms that offer omnibus accounts to
other broker-dealers are acting as - ANSWER Securities broker-dealers, not Investment
Advisors. Omnibus accounts are considered brokerage products
4
government agencies, human beings
What is not considered a person under the USA? - ANSWER An equitable interest in a
corporation
Terms that describe persons who are human beings under the USA - ANSWER natural
persons, individuals
The model law that most states have adopted as the basis for their securities regulations -
ANSWER Uniform Securities Act (USA)
Definition of the term "state" under the USA - ANSWER any state, territory, or possession
of the United States
All persons who are state securities-registered must renew their registrations each -
ANSWER Dec 31
How state registration fees are assessed under the USA - ANSWER annually, not pro-rated
for partial years
Upon the merger of a broker-dealer with another firm, when the state registration fee is due
- ANSWER A fee is assessed on the next Dec 31; the surviving firm receives a carry-over
registration and does not pay a fee at the time of the merger
1
,Under the USA, agents of two firms that merge retain their registration and are associated
with - ANSWER the successor firm
The type of client notification required when a registered person changes his/her firm
association - ANSWER None. Information does not need to be sent to clients. However,
the change must be promptly updated with the Administrator.
When a registered person must notify the Administrator about any changes to information
in his/her registration, such as firm association or address - ANSWER Promptly
State registration requirements for fingerprints and character affidavits consists of -
ANSWER no requirements; fingerprints and character affidavits are not required with
registration at the state level
The type of convictions that can result in statutory disqualification of a state registration -
ANSWER conviction for any felony in the past 10 years and conviction of any securities-
or money-related misdemeanor in the past 10 years
Regulatory action that can result in a statutory disqualification from registration -
ANSWER An injunction by the SEC, state securities Administrator, or self-regulatory
organization
During an application for securities registration, a personal bankruptcy must be reported if it
occurred during - ANSWER the past 10 years; bankruptcy is not a statutory
disqualification, but it must be disclosed
When a personal bankruptcy can be grounds for denying or revoking a securities registration
- ANSWER when the applicant is currently insolvent (bankrupt)
The period during which a state Administrator may suspend or revoke a registration based
on information submitted on an application - ANSWER only during the first 90 days of
2
,registration (after 90 days, inaccuracies in the application cannot be used to justify a denial
of registration)
When an application for securities registration normally become effective - ANSWER
noon, 30 days after filing (however, the Administrator may accelerate or delay effectiveness)
The time period during which an agent can continue doing business with a client under an
existing state registration, after that client moves to a new state - ANSWER 30 days
The type of state registration or renewal application that must include a consent to service
of process - ANSWER only the initial registration, not renewals
The scope of the permission granted by an agent under a consent to service of process -
ANSWER The agent agrees to accept service on civil actions related to the securities
industry. The consent does not include criminal actions or civil actions outside the industry
The impact of a broker-dealer's registration suspension on its registered employees is -
ANSWER all registrations of its employees are suspended until the firm's registration is
reinstated
The jurisdiction of FINRA in registering Investment Advisors is - ANSWER None. The SEC
and state register and regulate Investment Advisors
Obtaining state registration with an Administrator means that a broker-dealer has qualified
to - ANSWER lawfully sell securities in the state of registration
The role of the Administrator in verifying the truth and accuracy of a broker-dealer's
registration filing is - ANSWER None. The administrator does not imply that the
registration is true and accurate-only that the firm has made sufficient disclosure to sell
securities
3
, A broker-dealer can charge a client for a service only when - ANSWER the service has
been performed (not when it is promised, requested, or contracted)
The situation in which a broker-dealer can charge a client a mark-up is when - ANSWER it
is selling securities from its own account, acting as a principal
The situation in which a broker-dealer can charge a client a mark-down is when -
ANSWER it is buying securities from its own account, acting as a principal
A broker-dealer charges customers mark-ups and mark-downs when trading securities as -
ANSWER a principal (for its own account)
A broker-dealer can charge customers trading commissions when trading securities as -
ANSWER an agent (i.e. matching the customer with a buyer or seller on the other side of
the trade)
A broker-dealer is allowed to charge a customer both a commission and a mark-up on the
same trade in what circumstances? - ANSWER Never
A student who sells US Treasury bonds to other students must register as a broker-dealer
because - ANSWER treasuries are securities. Entities that sell securities in the US must be
registered as broker-dealers, or as registered agent of broker-dealers
A broker-dealers application for securities registration must disclose these employees'
salaries - ANSWER Never. The application need not include salaries of officers, directors,
or employees
For purposes of meeting registration requirements, firms that offer omnibus accounts to
other broker-dealers are acting as - ANSWER Securities broker-dealers, not Investment
Advisors. Omnibus accounts are considered brokerage products
4
