Ch 8 Administration of the USA Flashcards
An _______ is any attempt or solicitation to dispose of a security for value.
offer (offer to sell)
If shares of stock are freely given with the purchase of a bond, is this considered an offer and sale?
Yes
May the Administrator levy fines on a registrant?
No
An ________ is any attempt or solicitation to acquire or dispose of a security for value.
Offer
When is an offer subject to a specific state’s securities laws?
When it originates in, is directed to and received in, or is accepted in the state
Define jurisdiction.
The power to interpret and apply the law or the territorial range of authority or control.
Under the Uniform Securities Act, the statute of limitations for fraud is ____ years.
five years.
True or False: An agent may be arrested by the Administrator for refusing to cooperate with an investigation.
False. The Administrator does not have the authority to arrest a person who violates state law.
True or False: If FINRA issues an order against a firm, an Administrator may take action against a BD’s registration.
True
May the Administrator audit the books and records of a registered firm?
Yes. The Administrator may subpoena, audit, and inspect the books and records of registered firms.
The maximum criminal penalty for violations of the USA is _____ years in prison and/or up to a $______ fine.
three years in prison and/or up to a $5,000 fine.
If an agent has withdrawn registration, the Administrator may still take action for ___ year(s) after the withdrawal.
one year
Does the Administrator require proof of wrongdoing to initiate an investigation?
No, but she does need to be able to refer to a rule or order when starting the investigation.
True or False: The Administrator may enjoin (issue an injunction) a registered individual or firm.
False. The Administrator may only issue a cease and desist order. The Administrator may not issue an injunction.
If an offer is made using the mail, where is the offer considered to have been made?
In the state from which it originated and the state to which it is directed
The appeal of an administrative order is made before a court of _________________________.
competent jurisdiction (state court).
A registration withdrawal is effective ____ days after filing.
30 days after filing.
True or False: An Administrator may issue a cease-and-desist order before a violation has occurred.
True
The statute of limitations for criminal violations of the USA is ____ years.
five years.
True or False: An Administrator is not required to provide written findings of fact when revoking a registration.
False. The Administrator must provide written notification, written findings of fact, and an opportunity for a hearing.
The Administrator has the power to issue a _____ ___ ______ order, but not an __________.
cease and desist order, but not an injunction.
May an Administrator subpoena records in another state to investigate potential violations that occurred in his own state?
Yes, the Administrator has broad inspectorial power, which stretches beyond his own state.
True or False: A warrant attached to the sale of a bond is considered a sale of the warrant.
True
True or False: A gift of assessable stock is considered both an offer and sale.
True
