Series 65 – Uniform Investment Adviser Law Exam
Answers with Explanations
1. Under the provisions of the Uniform Securities Act, which of the following
statements about unsolicited orders is TRUE?
A) If the order ticket is appropriately marked, the Administrator may not challenge
a broker-dealer's assertion that the order was unsolicited.
B) Under certain conditions, an Administrator may prohibit a broker-dealer
registered in the state from accepting any unsolicited orders.
C) A client may not purchase, at his own initiative, securities trading in the
secondary market if the agent is otherwise prohibited from soliciting the order.
D) An unsolicited order from a noninstitutional client for an unregistered,
nonexempt security is considered a transaction exempt from the registration
and advertising filing requirements of the act.
Answer: D
Clients have the right to buy or sell whatever they desire. The issue becomes a
question of who initiates the trade. An unsolicited transaction may be executed by an
agent if it is the client who asks for the trade. The trade ticket should be marked as
unsolicited. The State Securities Administrator has the right to seek verification from
the client that the trade was, in fact, unsolicited. The security involved in the trade can
be one that is nonexempt and unregistered in the state.
2. One of your clients is a widow with three grown children. She wants the assets
in her account to go to her children upon her death—50% to her daughter and
25% to each of her sons. She does not want the estate to have to deal with
probate on these assets. How should her account be set up?
A) Joint tenants with right of survivorship
B) Tenants in common
C) Transfer on death
D) Tenants in the entirety
Answers with Explanations
1. Under the provisions of the Uniform Securities Act, which of the following
statements about unsolicited orders is TRUE?
A) If the order ticket is appropriately marked, the Administrator may not challenge
a broker-dealer's assertion that the order was unsolicited.
B) Under certain conditions, an Administrator may prohibit a broker-dealer
registered in the state from accepting any unsolicited orders.
C) A client may not purchase, at his own initiative, securities trading in the
secondary market if the agent is otherwise prohibited from soliciting the order.
D) An unsolicited order from a noninstitutional client for an unregistered,
nonexempt security is considered a transaction exempt from the registration
and advertising filing requirements of the act.
Answer: D
Clients have the right to buy or sell whatever they desire. The issue becomes a
question of who initiates the trade. An unsolicited transaction may be executed by an
agent if it is the client who asks for the trade. The trade ticket should be marked as
unsolicited. The State Securities Administrator has the right to seek verification from
the client that the trade was, in fact, unsolicited. The security involved in the trade can
be one that is nonexempt and unregistered in the state.
2. One of your clients is a widow with three grown children. She wants the assets
in her account to go to her children upon her death—50% to her daughter and
25% to each of her sons. She does not want the estate to have to deal with
probate on these assets. How should her account be set up?
A) Joint tenants with right of survivorship
B) Tenants in common
C) Transfer on death
D) Tenants in the entirety
