Chapter 1 Part 1 Flashcards
Blue-Sky Laws
speculative schemes which have no more basis than so many feet of blue sky
Securities Act of 1933
the first federal legislation to regulate these markets
Definition of exempt
A person and/or a security who is not required to register with a regulator.
Definition of nonexempt
A person and/or security that is nonexempt is not exempt from registration. In other words, the person or security is required to register with a regulator.
A person or a security who is required to register at the state level
must follow the rules, regulations, and guidelines of the Uniform Securities Act (USA).
Federal registration
require that documents be filed with the Securities and Exchange Commission (SEC).
A security includes, but is not limited to,
common stock, bonds, option contracts, and variable annuities.
A person is defined as
any legal entity that is not deceased, is not a minor, and is not mentally incompetent.
Under the Uniform Securities Act, the term person can include
individuals, corporations, partnerships, sole proprietorships, issuers, and state Administrators (both the office and the individual).
An issuer is
any person who issues or proposes to issue any security.
The term issuer includes
the U.S., state, local or foreign governments, corporations, and partnerships.
A broker-dealer (BO) is
any legal person in the business of effecting transactions in securities for the accounts of others or for its own account
A firm is acting in the capacity of a broker
when effecting securities transactions on behalf of its clients.
In other words, a broker will locate the
other side of the trade.
A firm is acting in the capacity of a dealer when
effecting securities transactions for its own account.
