ABBR and Timing Flashcards
When must Form U5 be filed with FINRA and a copy provided to the RR upon termination of an RR’s employment?
Within 30 days
True or False: An office of supervisory jurisdiction (OSJ) is inspected monthly.
False. An OSJ is inspected annually.
According to the Equity IPO Rule, when must firms update the eligibility of purchasers?
Annually
How long must a client’s name and number be kept on the Do Not Call List?
Indefinitely
When is notification required if a firm’s net capital is below 120% of its minimum or its AI to NC ratio exceeds 12:1?
Within 24 hours of discovery
When must a BD buy in the securities if a selling client fails to deliver securities?
No later than 10 business days from settlement of the transaction
For how many months following the last sale of a new issue may Rule 147 offerings not be sold to an out-of-state investor?
Six months
In mutual fund retail communication, performance statistics must cover which periods?
One-, five-, and 10-year periods
How long are Letters of Intent valid?
13 months
What is the settlement period for trades of U.S. Government securities or option contracts?
1 business day (T+1) following the trade date
How many calendar days must a DVP transaction be completed within?
35 calendar days
For how many years are customer ledgers (account records) maintained?
Six years
When is information from a TRACE report available to the public?
Immediately
According to the HSR Act, when may an M&A deal be completed after notification?
30 days after notification
How many business days does a carrying firm have to resolve a discrepancy claim after the transfer?
Five business days
During which minutes of trading may issuers of nonactively traded securities not purchase their own shares?
The last 30 minutes of trading
When do penalties become effective under the Code of Procedure unless appealed?
No later than 30 days from the decision
How many days do individuals have to register with the SEC after becoming an insider?
10 days
How many days prior to the effective date of a satisfactory subordinated loan must FINRA be notified?
30 days
When must trades executed between 8:00 a.m. and 8:00 p.m. be reported?
Within 10 seconds of execution
How often must BDs publish reports summarizing their order routing practices?
Quarterly
When must the Annual Report of Financial Condition be filed with the SEC?
No later than 60 days from the date of the financial statement
When is filing Form 211 not required?
If stock has been the subject of regular and continuous quotes for the past 30 days
How many calendar days must an underwriting manager wait before publishing research on the issuer’s secondary offering?
Three calendar days
For how many days may Letters of Intent be back-dated?
90 days
To avoid a close-out, when must a selling client deliver the securities to the BD?
Within 10 business days from settlement
What step is required if a fail-to-deliver position has been open for 13 consecutive settlement days?
Mandatory close-out
If the terms of a tender offer are changed, for how many additional days must the offer remain open?
At least 10 business days from the change
When is a non-branch office inspected?
Periodically
What is an ECN?
Electronic Communication Network; any one of several systems which permit the entry and dissemination of quotes
How often must a carrying BD file Focus Report Part I?
Monthly
For how long must a prospectus be made available in the secondary market for an exchange-listed IPO?
25 days
When is a net capital adjustment required for short securities differences?
After seven business days
When must a firm’s business continuity plan be made available to FINRA?
Promptly upon request
How often must the Special Reserve Bank account be evaluated by a carrying firm?
Weekly
For how long is Shelf Registration valid?
Up to 3 years
For how many days must a prospectus be provided in the after-market following a non-exchange follow-on offering?
40 days
How many days written notice must a firm provide margin clients of changes in the method of computing interest?
At least 30 days
True or False: Trades executed between 8:00 p.m. and 8:00 a.m. ET must be reported within 10 seconds of execution.
False. The 10-second reporting requirement applies to trades executed between 8:00 a.m. and 8:00 p.m. ET.
When must a maintenance call be met if a client’s equity falls below 25%?
Promptly
What time limit exists for issuers/affiliates of actively-traded securities that are repurchasing their own security?
They may not purchase their security within the last 10 minutes of the trading day
When must nonpublic information be disclosed to the public if unintentionally disclosed to an analyst?
Within 24 hours of its disclosure
Within how many business days must a principal approve or reject a variable contract application sent to an OSJ?
Seven business days
On what days do the call time restrictions under the TCPA apply?
Every day of the year
True or False: Under Reg. S, investors may resell non-convertible debt in the U.S. even if held for less than one year.
True. Non convertible debt has a 40-day holding period.
How often must senior management be apprised of the status of the firm’s supervisory control system?
Annually
How many days prior notice must the Hearing Panel give a member firm before a hearing is held?
28 days
When is a TRACE report made for trades that occur between 8:00 a.m. and 6:29:59 p.m. ET?
Within 15 minutes of the trade
When must retail communication concerning an investment company be filed with FINRA?
Within 10 business days of use
How many days does a person have to register with the SEC after becoming an insider by filing Form 3?
10 days
How many days must firms subject to the Taping Rule commence taping phone calls?
Within 60 days
What must an ad referring to a 6-year-old fund’s ranking based on total return also refer to?
The total return for the one- and five-year periods by the same ranking entity.
When must the board of directors advise its shareholders regarding a tender offer?
Within 10 days from the date the tender is made
When must fails-to-deliver in threshold securities be closed-out?
After 13 consecutive settlement days
For how many years must a record of all customers’ securities positions be maintained?
Six years
When must RRs complete the Regulatory Element of Continuing Education?
Annually by December 31
For how many business days may the SEC suspend trading for an individual issue?
Up to 10 business days
When is the next Regulatory Element of continuing education due for a person registered for nine years?
December 31 of the current year
How long must new issues be held before they may be used as collateral?
30 days
True or False: A temporary location used less than 30 business days per year is a branch office.
False. If used less than 30 business days per year, a temporary location is a non-branch office (e.g., a vacation home).
Under the Code of Procedure, what is the first opportunity to respond timeframe?
Within 25 days, and within 14 days for the second.
When must a principal of a member firm approve discretionary orders?
Promptly
When must FINRA be provided equal access if retail investors are provided direct access to an investment analysis tool?
Upon request
If owned for how many days may open-end investment company (mutual fund) shares be used as collateral in a margin account?
30 days
What are Nasdaq market maker normal market hours?
9:30 a.m. to 4:00 p.m. ET
For how long must a firm retain any written or electronic communication?
Three years from the date of last use
What entity is the parent of the National Securities Clearing Corporation (NSCC)?
The Depository Trust and Clearing Corporation (DTCC)
For how many years must copies of confirmations be maintained?
Three years
How must trades effected by representatives be approved?
Promptly by a principal
What is the CQS?
The Consolidated Quotation System; provides quotes for NYSE and AMEX listed securities, including third-market quotes
How often are firms required to evaluate their training needs?
Annually
For how long must a prospectus be provided in the after-market for the IPO of a stock to be listed on an exchange?
25 days
What is the effective date of an offering generally after the filing of the last amendment?
The 20th day after the filing of the last amendment
What does it mean when the SEC can sue for treble damages for insider trading violations?
The SEC can sue for three times the damage (profit made or loss avoided).
For how long are securities restricted that are received by a BD as compensation for an underwriting?
6 months
What is the penalty for a Nasdaq market maker with an unexcused withdrawal from publishing a quote?
20 business days in that stock
How frequently do BDs conduct physical counts of securities in their possession?
Quarterly
What is defined as an initial public offering (IPO)?
A company’s first public offering of securities
What protects customers from BD bankruptcy?
Securities Investor Protection Corporation (SIPC)
What type of securities are reported through the CQS?
Listed securities trading over-the-counter
What happens if the S&P 500 falls by 20% from the previous day’s close?
Trading halts for the remainder of the day.
According to Reg T, what happens to a client’s account if she fails to pay in a timely manner?
Her account will be frozen for 90 days.
What is TRF?
The Trade Reporting Facility. TRF reports trades in Nasdaq and Third Market securities.
What is the maximum maturity of a temporary subordinated loan for underwriting purposes?
45 days
How frequently is TRACE reporting required?
Within 15 minutes of a trade.
During which minutes of trading may issuers of actively traded securities not purchase their own shares?
The last 10 minutes of trading.
What is a QIB?
Qualified Institutional Buyer (institutions defined under Rule 144A)
TRACE reporting is required within ____ minutes of a trade.
TRACE reporting is required within 15 minutes of a trade.
Issuers of actively traded securities may not purchase their own shares during the last ____ minutes of trading.
Issuers of actively traded securities may not purchase their own shares during the last 10 minutes of trading.
Using the MQP, a person may be out of the securities industry for up to ____ years before having to requalify.
Using the MQP, a person may be out of the securities industry for up to five years before having to requalify.
Under Regulation T, does the payment date requirement apply to cash or to margin accounts?
Both. Payment is due within three business days for a cash account (100% payment) and a margin account (50% payment).
Based on written request, what is the maximum period that a B/D may hold customer correspondence?
Three months. To exceed three months, the customer must provide the B/D with a valid reason for the request.
To be considered a WKSI, the issuer must have been a reporting company for the previous ____ months.
To be considered a WKSI, the issuer must have been a reporting company for the previous 12 months.
Under the Code of Procedure, a decision must be rendered within ____ days after collection of evidence stops.
Under the Code of Procedure, a decision must be rendered within 60 days after collection of evidence stops.
A member firm’s written and electronic communication must be retained for _____ years from the date of last use.
A member firm’s written and electronic communication must be retained for three years from the date of last use.
According to NYSE rules, if the S&P 500 falls by 13% from the previous day’s close, trading will halt for ____ minutes.
According to NYSE rules, if the S&P 500 falls by 13% from the previous day’s close, trading will halt for 15 minutes.
Trades involving corporate and municipal securities settle by the _______________ day following the trade date (T + __).
Trades involving corporate and municipal securities settle by the first business day following the trade date (T + 1)
When must insiders report their transactions?
Within 2 business days of the trade
To be considered a threshold security, excessive fails-to-deliver must occur for ____ consecutive settlement days.
To be considered a threshold security, excessive fails-to-deliver must occur for 5 consecutive settlement days.
What is the after-market prospectus requirement for the follow-on offering of an exchange-listed stock?
No requirement exists for the follow-on offering of an exchange-listed stock.
All documents are to be maintained readily accessible for the first ___ years.
All documents are to be maintained readily accessible for the first 2 years.
If a qualification exam has been failed for the third time, what waiting period applies?
After the third unsuccessful attempt, the waiting period is 180 days after each additional attempt.
A trade in a TRACE-eligible security is executed at 2:55 p.m. When is the trade required to be reported?
By 3:10 p.m. (within 15 minutes)
What is the penalty for a voluntary withdrawal as a Nasdaq market maker?
A 20-business-day suspension from quoting that security
Corporate bond trades are reported through TRACE within _____ minutes.
Corporate bond trades are reported through TRACE within 15 minutes.
TRACE then disseminates information in real time.
An RR discovers securities are lost/missing, when must she report this fact to the SIC and transfer agent?
Within one business day following a two-day search.
If securities are in transit and are identified as such, the buy-in will be delayed for ______ calendar days.
If securities are in transit and are identified as such, the buy-in will be delayed for seven calendar days.
Client information is sent to the client within ____ days of the account opening and updated at least every ____ months.
Client information is sent to the client within 30 days of the account opening and updated at least every 36 months.
If a firm reduces its staff to avoid the Taping Rule, the individuals may not be rehired for ____ days.
If a firm reduces its staff to avoid the Taping Rule, the individuals may not be rehired for 180 days.
True or False: For a seasoned issuer, a shelf registration becomes effective immediately.
False. A seasoned issuer may use a shelf registration, but it will be subject to SEC staff review.
The industry minimum maintenance requirement for a long account is ____%.
The industry minimum maintenance requirement for a long account is 25%.
Equity must be at least 25% of LMV.
What are the regular hours for the ADF Trading Center?
9:30 a.m. to 4:00 p.m. ET
According to Regulation M, the Restricted Period begins either ___ or ___ business days before pricing.
According to Regulation M, the Restricted Period begins either 1 or 5 business days before pricing.
The NBBO or National Best Bid and Offer is also referred to as the _________ market.
The NBBO or National Best Bid and Offer is also referred to as the inside market.
When may telemarketers place calls to prospective clients?
From 8:00 a.m. to 9:00 p.m. on any day of the year.
A seasoned issuer may use a free writing prospectus (FWP) ______ filing its registration statement with the SEC.
A seasoned issuer may use a free writing prospectus (FWP) after filing its registration statement with the SEC.
Define promptly as it relates to a principal’s approval of discretionary orders.
Promptly means on the day of the trade, but not in advance.
What system facilitates the mandatory reporting of secondary-market trades in eligible fixed-income securities?
TRACE (Trade Reporting and Compliance Engine)
What amount of time that must elapse before debt securities issued under Regulation S may be resold into the U.S.?
40 days. The securities would remain exempt from registration.
A branch that supervises one or more non-branch locations must be inspected ____________.
A branch that supervises one or more non-branch locations must be inspected annually.
How many business days prior to presentation must evidence of incumbency be dated?
No more than 60 days.
Gifts exceeding $_____ are considered excessive.
Gifts exceeding $100 are considered excessive.
True or False: After completing a 20-business-day suspension as a MM, a firm may immediately begin quoting the stock.
False. The firm must reapply and, once its application is approved, it may begin quoting on the same day.
Customer confirmations must be maintained for ______ years.
Customer confirmations must be maintained for three years.
Once Form 144 is filed, owners have __________ to sell their securities.
Once Form 144 is filed, owners have 90 days to sell their securities.
If securities are discovered missing during a quarterly securities count, what is the reporting period?
No later than 10 business days from discovery.
If an investment analysis tool is made available to retail investors, FINRA must be provided access ____________.
If an investment analysis tool is made available to retail investors, FINRA must be provided access upon request.
True or False: An order-entry firm has 10 seconds to accept or reject a trade report submitted to FINRA.
False. The order-entry firm has 20 minutes to accept or reject a trade report submitted to FINRA.
How often must an updated copy of the privacy notice be provided to customers?
At least once during each 12-month cycle.
True or False: Form U5 is retained for six years following termination of employment.
False, Form U5 is retained for three years.
The SEC may suspend trading on an exchange for up to ____ days.
The SEC may suspend trading on an exchange for up to 90 days.
A BD’s outstanding subordinated debt may NOT exceed ____% of its debt-equity total for a period exceeding ____ days.
A BD’s outstanding subordinated debt may NOT exceed 70% of its debt-equity total for a period exceeding 90 days.
Generally, how often will a BD calculate the required deposit in its Special Reserve Bank Account?
On a weekly basis.
A satisfactory subordinated loan has a minimum maturity of ________.
A satisfactory subordinated loan has a minimum maturity of 1 year.
The CQS is the _______________________________.
The CQS is the Consolidated Quotation System.
After receiving notice from the Dept. of Enforcement regarding a complaint, the firm must respond within ____ days.
After receiving notice from the Dept. of Enforcement regarding a complaint, the firm must respond within 25 days.
What are the justifiable reasons for denying an individual’s registration?
Conviction for any felony or securities-related misdemeanor within the last 10 years.
If firm is acting as a dealer (not a manager or co-manager) on an IPO, what’s the quiet period on research?
Dealers cannot publish research until 10 calendar days after an IPO.
An issuer with $700 million outstanding voting shares would be placed in what category?
Well-Known Seasoned Issuer (WKSI).
What happens if a variable contract is sold to a client who then cancels the contract within seven business days?
The selling BD must return its portion of the sales charge.
As stated in a BD’s supervisory program, with whom must the CEO annually conduct a meeting?
The BD’s Chief Compliance Officer (CCO).
Trades executed through an electronic system are reported _______________.
Trades executed through an electronic system are reported automatically.
What must be noted by a client to prevent her buy limit and sell stop orders from being reduced on the ex-dividend date?
Do Not Reduce (DNR).
What is the benefit of ACATS?
It replaces a manual account transfer system with a fully automated and standardized one.
What is the ADF reporting system?
The ADF reporting system reports trades in securities quoted in the Alternative Display Facility (ADF).
According to NYSE rules, if the S&P 500 falls by 7% from the previous day’s close, trading will halt for ______ minutes.
According to NYSE Rules, if the S&P 500 falls by 7% from the previous day’s close, trading will halt for 15 minutes.
Upon validation of a transfer, the transfer must be completed within ___ business days.
Upon validation of a transfer, the transfer must be completed within 3 business days.
On 5/1, Joe e-mails 20 clients to promote a product. On 7/1, the same e-mail is sent to 15 clients. Is approval needed?
No. Since the promotional e-mail is sent to 25 or fewer clients over 30-calendar days, only review is required.
A carrying BD must file FOCUS Report Part I within _____ business days of month-end.
A carrying BD must file FOCUS Report Part I within 10 business days of month-end.
For how long after an associated person leaves a BD are employee records maintained?
Three years.
A carrying BD must file Focus Report Part II _________.
A carrying BD must file Focus Report Part II quarterly.
True or False: CQS transactions must be reported within 10 seconds of completion.
True. CQS transactions must be reported within 10 seconds.
What is CAT?
The Consolidated Audit Trail; it enables FINRA to review all trading activity in the U.S. equity and option markets.
A TRACE-eligible corporate bond trade occurs at 6:20 p.m. When is the trade required to be reported?
It may be reported within 15 minutes of TRACE opening on the next business day.
When must a BD notify the authorities if securities are discovered missing due to a securities count?
Within 10 business days.
According to the Piggyback Exception, when is the filing of Form 211 not required?
When the stock has been quoted on a regular and continuous basis for the past 30 days.
To not be a branch office, a location may not be used for securities business more than ____ business days per year.
To not be a branch office, a location may not be used for securities business more than 30 business days per year.
Under the TCPA, if requested, a client must be placed on the Do Not Call List within ____ days of request.
Under the TCPA, if requested, a client must be placed on the Do Not Call List within 30 days of request.
Regulation A requires an issuer to file ____ years of financial statements that may be __________.
Regulation A requires an issuer to file two years of financial statements that may be unaudited.
If a BD’s equity is below ____% of its debt-equity total, a violation will occur if not corrected within ____ days.
If a BD’s equity is below 30% of its debt-equity total, a violation will occur if not corrected within 90 days.
For active accounts, many firms send account statements ________.
For active accounts, many firms send account statements monthly.
How many days advance notice is provided to clients if a BD changes loan terms (e.g., interest rate)?
30 days.
In what does a real estate investment trust (REIT) invest?
A diversified portfolio of properties and/or mortgages.
When is settlement for a transaction that’s using a seller’s option settlement?
On a date that’s agreed on by both parties, but not earlier than two business days after the trade date.
How often must clients be notified of the availability of the BrokerCheck system?
Annually.
True or False: Although Nasdaq market maker open hours are 9:30 a.m. to 4:00 p.m., extended trading hours are available.
True. However, specific risks are inherent in extended hours trading.
If a storyboard has been filed, when must the final version of a TV or video advertisement be filed with an SRO?
Within 10 business days of initial broadcast.
For retail communication regarding variable contract performance, what periods must be covered?
One-, five-, and 10-year periods (or the plan’s/policy’s life).
To cover a short sale, investors may not use a new stock issue if the short sale occurred within how many days of the offer?
5 days
If a client requests a copy of the predispute arbitration agreement, when must it be provided?
Within 10 business days of the request
After filing notice of an impending M&A deal, it may not be completed until how many days have elapsed?
30 days
Typically, investment companies are allowed no more than how many days from request to complete a redemption?
7 days
What system is used for reporting corporate bond trades?
TRACE (Trade Reporting and Compliance Engine)
Between 8:00 a.m. and 6:29:59 p.m. ET, who reports a trade to TRACE when two FINRA members are involved?
Each FINRA member is required to report its side of the trade.
What two choices does a firm have once it is notified that it has met the threshold established under the Taping Rule?
Begin taping within 60 days or reduce its staff level below the threshold within 30 days
For how long must a prospectus be provided in the after-market for a non-exchange follow-on offering?
40 days
An applicant will be subject to statutory disqualification for any felony conviction within the last how many years?
10 years
An MM may withdraw its quote for up to how many business days for issues beyond its control?
Five business days
A trial balance used to calculate net capital is prepared how often?
Monthly
A market maker’s registration ceases if no quote is made within how many business days?
Five business days
What does UTP mean?
Unlisted Trading Privileges, which allows an exchange to trade securities not listed on that exchange.
Short securities differences will have a 100% haircut after how many days have elapsed?
28 days
What is the maximum criminal penalty for an individual convicted of insider trading?
$5 million fine, and/or up to 20 years in prison
For passive market making to occur for a stock, it must have how many independent market makers?
One
When must clients of a BD receive the firm’s most recent balance sheet?
On request
What exception allows an underwriting manager to immediately publish research on a company due to a significant event?
The Hot News exception
If an associate requests a copy of his U5, how long does the member firm have to respond?
Response must be made within 2 business days of request.
True or False: The ex-dividend date is on the same date as the record date.
TRUE
What is the trade reporting system for Nasdaq securities?
Trade Reporting Facility (TRF) - formerly the Automated Confirmation Transaction system (ACT)
BDs are not required to take action if a margin deficiency is less than what amount?
$1,000
If a BD’s investment company communications do not include self-created rankings, when must they be filed with FINRA?
Within 10 business days of first use
Once notified by a Code of Procedure hearing panel, the hearing must be held within how many days?
28 days
True or False: A registered person with no disciplinary actions for 15 years is excused from the Regulatory Element.
False. All registered personnel must complete the Regulatory Element of continuing education annually by December 31.
A QIU is a firm that has acted as what in at least how many similar offerings within the last how many years?
A QIU is a firm that has acted as manager or comanager in at least three similar offerings within the last three years.
Nasdaq system hours are from what time to what time ET?
4:00 a.m. to 8:00 p.m. ET
Once notified that taping is required, firms have how many days to start taping and for how long are tapes retained?
60 days to start taping and tapes are retained for three years.
Under Sarbanes-Oxley, how often must a company file reports detailing internal controls over financial reporting?
Annually
If a fidelity bond is modified or cancelled, when must FINRA be notified?
Promptly
How many times is a quarterly Form 10-Q filed each year?
Three times per year since the fourth quarter is included in the annual report.
For how long is an employee questionnaire (Form U4) and fingerprint cards retained?
For 3 years after the representative leaves the firm
A syndicate member must wait how many calendar days before publishing research on the issuer’s IPO?
10 calendar days
The statute of limitations for submitting an arbitration claim is how many years from the occurrence of the event?
6 years
An arbitration award must be paid within how many days?
30 days
The final settlement of a syndicate account must occur within how many days of the syndicate closing?
90 days
An RR leaves his firm to join the military. After being discharged, his special inactive status continues for how many days?
90 days
For how long are securities restricted if received by the syndicate as compensation?
Six months
When buying securities in a restricted margin account, clients must deposit what percentage of the trade within how many business days?
50% of the trade within three business days.
Under the TCPA, an existing relationship exists if a client has engaged in transactions with a firm within how many months?
18 months
A branch office must be inspected every how many years?
Three years
In the after-market, a prospectus must be provided for how many days following a non-exchange IPO?
90 days
What type of transaction is being executed when a client purchases securities with payment made by a third party?
Delivery versus payment (DVP) or collect on delivery (COD)
Notice of a buy-in may not be delivered to the seller sooner than how many business days after settlement?
1 business day
What is the SIC?
Securities Information Center; created to identify and intercept stolen, forged or missing securities
The manager and comanager of an underwriting may not immediately issue research reports on investment banking clients.
True
QIB stands for what?
Qualified Institutional Buyer (QIB)
How often must market centers publish reports of the efficiency of executions?
Monthly
Once placed, a tender offer must remain open for at least how many business days from the announcement?
20 business days
What is the ADF?
The Alternative Display Facility; ECNs use it to display orders rather than the Nasdaq Market Center Execution System
What is the criminal penalty for insider trading by corporations?
$25 million per violation
All forms of communication with the public must be kept for how many years, but easily accessible for the first how many years?
Three years, but easily accessible for the first two years.
A branch office that is NOT responsible for supervising another office is inspected every how many years?
Three years
Three months ago, an insider acquired stock at $12. If she sells the shares today at $15, may she keep the profit?
No. Under the short-swing profit rule, an insider may not keep a profit earned on stock held less than six months.
The manager or co-manager of an IPO must satisfy a quiet period of how many calendar days prior to publishing research?
10 calendar days
If a non-transferable asset is sold, the carrying BD has how many business days to pay the client?
Five business days
Within how many days of notification that it is subject to the Taping Rule, a firm may reduce its staff to avoid the rule?
30 days
Upon receiving a second notice from the Dept. of Enforcement regarding a complaint, firms must respond within how many days?
14 days
Schedule ___ must be filed with the SEC within how many business days of acquiring more than __% of a company’s stock?
Schedule 13D must be filed with the SEC within five business days of acquiring more than 5% of a company’s stock.
The ______ is the office providing final approval of retail communication.
The OSJ (Office of Supervisory Jurisdiction)
A firm that reduces its staff to prevent from having to tape its calls must wait how many days before rehiring those RRs?
180 days
Retail communication for collateralized mortgage obligations (CMOs) must be filed within how many business days of use?
10 business days
In order to NOT file Form 211, no more than how many business days may have elapsed without a quote for the stock?
Four business days
When is FOCUS Report Part II (for carrying BDs) and FOCUS Report Part IIA (for introducing BDs) required to be filed?
Within 17 business days of the end of the quarter
For a WKSI, a shelf registration becomes effective when?
Immediately
Under the Code of Procedure, a sanction becomes effective how many days after the firm has received final notice?
30 days
When showing mutual fund returns, what time periods must be included?
1, 5, and 10 years or life of the fund if less
What are the system hours of operation for the ADF?
8:00 a.m. to 6:30 p.m. ET
For underwriting purposes, a BD is allowed up to how many temporary subordinated loans over how many months?
Three temporary subordinated loans over 12 months.
When may Regulation S securities be resold through a designated offshore securities market?
Immediately
When does the restricted period begin for a security with a public float of $50 million and an ADTV of $125,000?
One business day prior to pricing
When must final settlement of a syndicate occur?
Within 90 days of the syndicate closing
By what date must a clearing firm send to the introducing firm the list of all reports that it can generate?
By July 1st.
In CQS, what is the penalty if a market maker fails to provide timely quotes for a security?
A one-business-day suspension from market making in that security
What is the trade reporting system for OTC equities?
Over-the-Counter Reporting Facility (ORF)
Form U5 is filed with FINRA within how many days of resignation or termination of association with a member firm?
30 days
If equity securities are issued by a non-reporting company under Regulation S, when can they be resold in the U.S.?
One year after issuance
How long must a syndicate member wait before publishing research on the issuer’s IPO?
10 calendar days
According to the Locate Requirement of Regulation SHO, BDs may use an easy-to-borrow list less than how old?
24 hours old
What is the maintenance requirement for all forms of communication with the public?
Three years from last use
When would the following trades be reported to TRACE? One was executed at 6:20 p.m., the other at 8:40 p.m.
Both need to be reported within 15 minutes of TRACE opening on the next business day.
Within what period must any required adjustment be made to a firm’s fidelity bond?
Within 60 days of the anniversary of posting the bond
When must a company file a Form 10-K with the SEC?
Annually
Customer account information must be updated every how many months?
36 months
What is the time frame for reporting trades after TRACE opening?
Both need to be reported within 15 minutes of TRACE opening on the next business day.
Within what period must any required adjustment be made to a firm’s fidelity bond?
Within 60 days of the anniversary of posting the bond.
When must a company file a Form 10-K with the SEC?
Annually.
How often must customer account information be updated?
Customer account information must be updated every 36 months.
What is the maximum criminal penalty for insider trading by an individual?
The criminal penalty for insider trading by an individual is a maximum of $5 million and/or 20 years in prison.
After resignation of registration, how long does FINRA’s jurisdiction last?
Two years.
What program allows an RR to leave a BD and later rejoin without requalifying?
Using the Maintaining Qualifications Program (MQP), a person has five years before being required to requalify by exam.
Who publishes a list of all threshold securities?
A self-regulatory organization (SRO).
What is SIPC?
Securities Investor Protection Corporation. SIPC protects separate customers in the event of BD bankruptcy.
For how long are customer account records maintained after an account is closed?
For 6 years after the account is closed.
What is the minimum time for illustrations showing returns for variable products?
Illustrations showing returns for variable products must be for a minimum time of one year.
Under portfolio margin rules, how quickly must margin requests be satisfied?
Under portfolio margin rules, margin requests must be satisfied within three business days of request.
List some records that must be maintained for three years.
Trade tickets, confirms, trial balances, retail communication, correspondence, and employee records.
When must a carrying BD file FOCUS Report Part II?
A carrying BD must file FOCUS Report Part II within 17 business days of the end of the quarter.
Can Jim reenter the securities industry after serving a prison term for insider trading?
No. Statutory disqualification bars a person from the securities industry for 10 years from the date of the conviction.
How long will an MM be excused for withdrawing its quote for legal reasons?
An MM withdrawing its quote for legal or regulatory reasons will be excused for up to 60 days.
What investment facilitates the trading of foreign securities in U.S. markets?
American Depositary Receipts (ADRs).
What does TOD stand for in relation to a customer account?
Transfer on Death. TOD allows assets to transfer to a named beneficiary at owner’s death.
True or False: Form 211 must be filed by all market makers in Nasdaq securities.
False. Form 211 is required for those initiating quotes in non-exchange (OTC) securities.
What is the ORF?
The OTC Reporting Facility (ORF) reports trades in OTC markets (e.g., the Pink Market).
When must self-created rankings in investment company communications be filed with FINRA?
At least 10 business days prior to use.
What is the penalty for a CQS market maker with an unexcused withdrawal from publishing a quote?
One business day in that stock.
What form must be filed if an insider purchases or sells stock?
Form 4 must be filed with the SEC within two business days of the trade.
How long may a BD allow a selling client to deliver securities before closing out?
A BD may allow a selling client up to 10 business days from settlement to deliver the securities before closing out.
How long must an underwriting manager wait before publishing research on an issuer’s IPO?
10 calendar days.
How often are circuit breakers reset?
Daily.
How long does a firm have to validate or protest a transfer request?
1 business day.
How many days must awards granted by an arbitrator be paid within?
30 days.
When is a penalty imposed by a hearing panel effective?
A penalty imposed by a hearing panel is generally effective 30 days after assessment.
How often must BDs review their fidelity bond coverage?
BDs must review their fidelity bond coverage annually.
When must fails-to-deliver be closed out?
All fails-to-deliver must be closed out within 35 calendar days.
What is the OFAC List?
The Office of Foreign Assets Control of the U.S. Treasury List; it identifies suspected terrorists and criminals.
What is the payment requirement for Delivery vs. Payment (DVP)?
Delivery vs. Payment (DVP) requires payment to be made no more than 35 calendar days from the transaction.
For how long must a BD maintain institutional sales material?
Three years.
When must retail communication concerning CMOs be filed with FINRA?
Within 10 business days of first use.
When must an introducing BD file FOCUS Report Part IIA?
An introducing BD must file FOCUS Report Part IIA within 17 business days of the end of the quarter.
What type of report must mutual funds provide to their shareholders?
Mutual funds are required to provide a semiannual report to their shareholders.
When are clients provided a copy of the predispute arbitration agreement?
The earlier of 30 days from signing the agreement or within 10 business days of request.
When must the SIC be notified if a security is recovered after being reported as lost?
Within one business day of recovery.
What must a BD do upon making changes to its fidelity bond?
Upon making changes to its fidelity bond, the BD must notify its DEA promptly.
What other term may be used for a company’s CEO or CFO?
Principal Executive Officer (PEO) or Principal Financial Officer (PFO).
What is the maximum period that a stabilizing bid may remain open?
Indefinite.
How often must a non-branch office be reviewed?
A non-branch office must be reviewed on a periodic cycle.
What must a firm disclose when preparing research?
A firm preparing research must disclose whether it received underwriting compensation within the last 12 months.
When must representatives complete the Regulatory Element of continuing education?
On an annual basis, by 31-Dec.
What are treble damages?
The civil penalty for insider trading, which is three times the profit made or loss avoided.
What time does the Telephone Consumer Protection Act (TCPA) allow calls?
The Telephone Consumer Protection Act (TCPA), allows calls from 8:00 a.m. to 9:00 p.m. local time of the called party.
When will FINRA review a transaction reported at a clearly erroneous price?
Under normal circumstances, within 30 minutes.
What situations require a trade to be reported to TRACE within 15 minutes?
A trade occurs within 15 minutes of TRACE closing or a trade occurs when TRACE is not open.
When must a BD fill a client’s limit order after executing a trade for its own account?
Immediately (within 60 seconds).
Define short-swing profit.
A profit earned on stock held less than six months.
How often must BDs send statements regarding penny stocks?
Monthly.
What notice is required to begin using a form of electronic storage?
To begin using a form of electronic storage (other than CD-ROM), the BD’s DEA requires a 90-days advance notice.
How many days prior to the effective date of a subordinated loan must the SEC be notified?
The SEC must be notified 10 days prior to the effective date of a satisfactory subordinated loan.
What must an order be marked to avoid adjustment?
For an order to NOT be adjusted, it must be marked Do Not Reduce (DNR).
When is a BD required to report operational difficulties?
Within 24 hours.
What is the NBBO?
The National Best Bid and Offer, also considered the inside market.
How often must all registered personnel participate in a compliance meeting?
Annually.
What is the maximum sales charge on mutual funds according to industry rules?
According to industry rules, 8.5% is the maximum sales charge on mutual funds.
What is considered regular quoting under the Piggyback Exception?
Over the last 30 days, no more than four business days elapsed without a quote.
How long must insiders return short-swing profits?
Insiders must return short-swing profits, which are profits earned on stock that has been held for less than six months.
How often must account statements be sent to customers?
Account statements must be sent to customers at least quarterly.
What system provides quotes for the Third Market?
Consolidated Quotation System (CQS).
How many business days do customers have to pay for their portion of a trade?
Customers are given two business days after settlement date to pay for their portion of a trade (i.e., S+2 or T+3).
Under the Limit Order Display Rule, how quickly must orders improving a market maker’s quote be displayed?
Immediately, but no later than 30 seconds.
How long must an underwriting manager wait before publishing research on an issuer’s IPO?
An underwriting manager must wait 10 calendar days before publishing research on the issuer’s IPO.
For how long must a prospectus be provided in the after-market for a non-exchange IPO?
90 days.
What must an analyst do after his firm publishes research on a company?
Although there is no restriction, a research analyst must follow his firm’s procedures.
How many days does a candidate have to qualify for a principal position after appointment?
Once appointed as a principal, a candidate has 120 days to qualify for the position.
How long after notification of the buy-in can the actual buy-in occur?
After notification of the buy-in has been delivered, the actual buy-in may not occur for 2 business days.
For how long must records related to general securities activities be maintained?
For four years.
When may investors not purchase a new issue?
Investors may not purchase a new issue if those shares were sold short 5 business days prior to the offering.
What is a Private Investment in Public Equity (PIPE)?
When a BD acts as a placement agent for restricted securities of an issuer whose securities are already publicly traded.
When does a decision to ban or expel a registered representative become effective?
Immediately.
True or False: All branch offices are inspected annually.
False. Branch offices that supervise one or more other offices are inspected annually.
What defines an established customer?
An established customer is one that has traded with a firm for more than one year.
How long may a B/D hold customer correspondence based on written instructions?
Based on written instructions, a B/D may hold customer correspondence for three months.
How often must BDs monitor the status of fully paid and excess margin securities?
BDs are required to monitor the status of all fully paid and excess margin securities on a daily basis.
When must FOCUS Report Part I be filed by a carrying BD?
For carrying BDs, within 10 business days of month end; for introducing BDs, the report is not required.
What is the holding period for unregistered securities under Rule 144?
The holding period for unregistered (restricted) securities under Rule 144 is 6 months.
What must be done if a customer changes their address?
Notification must be sent to the customer’s old address within 30 days of the change.
What is TRACE?
The Trade Reporting and Compliance Engine. TRACE is a reporting system for corporate bonds.
When must a BD notify regulators if an auditor finds a deficiency?
A procedural deficiency is reported within 24 hours of discovery, and a corrective action plan is sent within 48 hours.
When do CAT reports need to be submitted to FINRA?
On the trading day after the data is recorded.
How many days must mutual fund shares be owned to have loan value?
Mutual fund shares have loan value after they have been owned for 30 days.
When must a principal review and approve/disapprove a variable annuity trade?
Within 7 business days.
How often must an investor’s eligibility to purchase an equity new issue be confirmed?
An investor’s eligibility to purchase an equity new issue must be confirmed annually.
This is called the pre-condition of sale.
For how many years must Form U5 be retained by member firms?
Form U5 must be retained by member firms for three years.
How often must BDs provide notification for customers with free credit balances?
For their customers with free credit balances, BDs must provide notification at least quarterly.
For how long must a prospectus be provided in the after-market following an IPO?
25 days.
