Ch 8 Administration of the USA Part II Flashcards
Statute of limitations for USA civil violations is _____ yrs. of occurrence or ___ yrs. of discovery, whichever is first.
three yrs. of occurrence or two yrs. of discovery, whichever is first.
True or False: The Administrator may confiscate records.
False. The Administrator may inspect records, but cannot confiscate them.
Is the payment of a stock dividend considered an offer or sale?
No
True or False: An Administrator may cancel a registration without the opportunity for a hearing.
True. Cancellation may be due to the death of an agent or a firm no longer being in business.
A person may appeal a stop order that is issued by the Administrator within _____ days.
60 days.
True or False: An Administrator may require a mutual fund to file its advertising.
False. Mutual fund advertising is filed with FINRA, not the Administrator.
With newspaper offers, no offer is made if more than __________ of the circulation is outside of the publishing state.
two-thirds
When may the Administrator cancel a registrant’s registration?
If the registrant has died, ceased doing business, been declared mentally incompetent or cannot be located
For how long does the Administrator maintain jurisdiction over a registrant after a withdrawal of registration?
One year
Define assessable stock.
Stock that allows the issuing entity to demand additional funds from existing stockholders
True or False: The exercise of convertible securities is considered a sale under the USA.
False
True or False: Registration denial orders issued by an Administrator are final, binding, and may not be appealed.
False. If denied, a person is entitled to written notification and findings of fact and an opportunity for a hearing.
If a cease-and-desist order is issued against an agent, the agent may file an appeal within _____ days.
60 days.
Can a BD punish one of its agents for responding to a subpoena?
No. This is a prohibited action.
Is being charged with a felony or securities-related misdemeanor grounds for statutory disqualification?
No. Statutory disqualification is due to conviction for any felony or securities-related misdemeanor in the past 10 yrs.
The statute of limitations for criminal violations of the Uniform Securities Act is ____ years.
five years.
If found civilly liable for violating the USA, what is the penalty?
The original amount paid, plus the legal rate of interest, attorney fees, and court costs, minus any cash received
True or False: The Administrator may bring a case in a civil court.
True. Both the Administrator and a private citizen may bring a case in civil court.
True or False: A gift of non-assessable stock is considered a sale.
False. However, the gift of assessable stock IS considered both an offer and a sale.
If the Administrator believes a person has violated or is about to violate the USA, may he issue an injunction?
No. The Administrator may not issue an injunction. Injunctions may only be issued by a court of competent jurisdiction.
True or False: A stock dividend is considered a sale.
False
A customer must respond to a letter of rescission within _____ days or lose the right to sue.
30 days
When will an offer fall under an Administrator’s jurisdiction?
If the offer originated in, was directed in, or was accepted in the Administrator’s state
Is the conversion of a bond into stock considered an offer or sale?
No
