5/15/2023 Flashcards
Are UIT’s Considered Investment Companies
YES
but they are not regulated under
Investment Company Act of 1940
They are Investment Companies
BUT
Arnt GOVERNED by the Act
Steps To Money Laundering
1) Placement - Placing the Dirty money into the Financial System
2) Layering/ Structuring - Moving it around a bunch
3) Integration - Pulling the money back out as clean money
SAR
Suspicious Activities Report
Must report any suspicious activities of +$5k or more to FINCEN
What does custody mean
You have custody of the client’s funds means:
You HOLD the funds/ securities
Think: Custodian
What do you need to know about Net Capital Requirements
If you have custody of clients funds:
it goes up
If receiving Client’s Funds time frame to returning them/ forwarding them without having custody
3 days
Without being a custodian can client make checks out to you?
No
only if you have custody of their funds
Clearing Firm
Another Name for
Custodian
List Reg SP Required Plans
Cyber Security Plan (Plan for Cyber Attack)
Business Continuity Plan (Plan for Disaster)
Business Succession Plan (Plan for Advisors Death)
What do all Reg SP Required Plans need to have
-Written Procedure Manual
-Distributed to Reps 1/yr
-Reviewed by Reps 1/yr
-Contain:
Name
Address
Phone #
for people in charge of enacting the plan
Additional Requirements for Cyber Security Plan
(other than all other Reg SP Plans requirements)
Must have a Data Backup that is offsite
Must have firewalls and other security set up
Additional Requirements for Business Continuity Plan
(other than all other Reg SP Plans requirements)
must have a plan on how to be back up and running within 24 hours of a disaster
Additional Requirements for Business Succession Plan
(other than all other Reg SP Plans requirements)
must have a plan for who is going to handle an advisor’s clients accounts if advisor passes away/retires
(usually, they become the “House” accounts) <= Must be clearly stated
