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Series 52 Group Share > FC CH 6 > Flashcards

FC CH 6 Flashcards

1
Q

Those qualified as municipal RRs (Series 52) may sell, trade, or underwrite municipals, but may not ____________ sales.

A

Those qualified as municipal RRs (Series 52) may sell, trade, or underwrite municipals, but may not supervise sales.

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2
Q

Who enforces the MSRB rules for broker-dealers?

A

FINRA and the SEC

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3
Q

True or False: A general securities principal may approve the opening of a municipal securities account.

A

True. Approval may also be provided by a municipal securities principal and a municipal securities sales principal.

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4
Q

What records of a gift must be maintained

A

The details of the gift as well as both the name of the person making and the person receiving the gift

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5
Q

True or False: No fiduciary responsibility exists between an underwriter and an issuer.

A

True. The interests of an underwriter are different from an issuer.

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6
Q

Who supervises a firm’s municipal activities and provides account approval, transaction review, and complaint handling?

A

Municipal Securities Principal (Series 53)

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7
Q

True or False: The manager of a syndicate giving each of its members a gift of $250 would violate the gift rule.

A

True. The maximum gift is $100 per person/per year and includes gifts between member firms.

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8
Q

Registration status becomes __________ if the Regulatory Element of CE is not completed within the prescribed period.

A

Registration status becomes inactive if the Regulatory Element of CE is not completed within the prescribed period.

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9
Q

__________________________ expenses are not subject to the Gift Rule.

A

Entertainment/business expenses are not subject to the Gift Rule.

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10
Q

Is it acceptable for a BD to give two tickets to a Broadway show (valued at $250) to an employee of another BD?

A

No. It is unacceptable. However, the gift limit would not be violated if the RR attends with the recipient

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11
Q

An RR leaves his firm to join the military. After being discharged, his special inactive status continues for ____ days.

A

An RR leaves his firm to join the military. After being discharged, his special inactive status continues for 90 days.

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12
Q

What activities may be performed by a municipal securities representative?

A

Attending syndicate meetings and obtaining quotes from municipal professionals

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13
Q

When must the MSRB notify a municipal dealer that one of its RR needs to complete the regulatory element of CE?

A

30 days prior to the two-year anniversary of the RR’s initial registration. The RR then has 120 days to complete it.

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14
Q

How many days are representatives given to complete the Regulatory Element of Continuing Education?

A

120 days from the anniversary date of their initial securities registration

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15
Q

True or False: RRs currently serving in the military can receive a CE waiver.

A

True

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16
Q

If not registered with a firm during military service, when does an RR’s two-year expiration clock begin counting down?

A

90 days after military discharge

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17
Q

True or False: A municipal limited placement is not subject to an underwriting assessment.

A

True

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18
Q

What products may be sold by a municipal securities representative?

A

Municipal bonds and 529 plans, but NOT municipal bond funds

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19
Q

Is it acceptable for an RR of one BD to take an employee of another BD to an NFL game costing $300 per person?

A

Yes. If the RR attends with the recipient, it is considered a legitimate entertainment expense.

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20
Q

Mary has been an RR for nine years. When is she next subject to the Regulatory Element of Continuing Education?

A

In two years, on the 11-year anniversary of her initial registration

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21
Q

Is it a violation of industry rules to give a person tickets to a high school sporting event?

A

No. This gift is permissible since it is unlikely that the ticket cost will exceed $100.

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22
Q

Jim left the securities industry more than two years ago. Why may he be able to rejoin without requalification?

A

Jim may have been serving in the military

23
Q

What relationship is created when a BD receives a fee for giving advice to a municipality regarding a new issue?

A

Financial Advisory relationship

24
Q

A municipal limited placement may not be sold to more than ___ sophisticated investors.

A

A municipal limited placement may not be sold to more than 35 sophisticated investors.

25
Q

The MSRB regulates ______________, but has no control over the ______________.

A

The MSRB regulates broker-dealers, but has no control over the municipalities.

26
Q

According to MSRB rules, who must review and intialize customer complaints?

A

A Municipal Securities Principal or Municipal Securities Sales Principal

27
Q

True or False: A copy of MSRB rules must be kept in each location where municipal activities occur.

A

True

28
Q

In order to provide research on municipal securities, an individual must hold a Series ___ registration.

A

In order to provide research on municipal securities, an individual must hold a Series 52 registration.

29
Q

True or False: Municipal securities representatives may sell municipal bond funds.

A

False. Municipal representatives may only sell individual municipal bonds.

30
Q

True or False: A registered person’s Continuing Education requirement is deferred while serving in the military.

A

True

31
Q

In order to engage in all types of municipal activities, an individual must hold a Series ___ registration.

A

In order to engage in all types of municipal activities, an individual must hold a Series 52 registration.

32
Q

If a registered person joins the military, what is her registration status?

A

She falls under the special inactive status designation.

33
Q

True or False: A gift in excess of $100 is permitted if it is recorded on the member firm’s books.

A

False. All gifts must be recorded and they may not be for more than $100.

34
Q

True or False: A gift in excess of $100 is allowed if given to a family member employed by another BD.

A

True. Gifts to family members are excluded from the Gift Limit Rule.

35
Q

While in the military, an RR has special inactive status. Must he return to the same BD to obtain registration benefits?

A

No, he may return to his previous BD or go to a new firm.

36
Q

True or False: A registered person with no disciplinary actions for 15 years is excused from the Regulatory Element.

A

False. The Regulatory Element of Continuing Education is an ongoing process with no graduation from the plan.

37
Q

Who must provide written authorization for a discretionary account?

A

Both the customer and the Municipal Securities Principal

38
Q

What steps must be taken if a municipal representative receives a complaint?

A

Forward it to her supervisor. A municipal dealer must also keep the complaint and the firm’s response in its records.

39
Q

Upon receipt of a written complaint from a client, what must a municipal BD send the client?

A

The MSRB Investor Brochure

40
Q

True or False: An associated person may receive non-cash compensation for selling the municipal bond of a specific issuer.

A

False. Non-cash compensation cannot favor specific products.

41
Q

True or False: An individual who holds a Series 7 registration may be involved in municipal underwritings.

A

False. Series 7 registrants are limited representatives and may only engage in purchases and sales with customers.

42
Q

True or False: Tickets valued at $500 given to four people are considered excessive.

A

True. The gift limit considers both the dollar value and number of intended recipients.

43
Q

What is the continuing education (CE) requirement of an RR who is currently serving in the military?

A

His registration is in Special Inactive Status and the CE requirement is halted.

44
Q

True or False: All registered personnel of a BD must complete the Regulatory Element of Continuing Education.

A

True

45
Q

Is it a violation of industry rules to give a person an $80 gift card?

A

No. However, this must be the only gift given for the year.

46
Q

True or False: Taking a client to a weekly event is a violation of the gift rules.

A

True. Taking a client to an annual event is acceptable, but weekly events are considered too frequent.

47
Q

Who enforces the MSRB rules for bank dealers?

A

The Comptroller of the Currency, the FRB, or the FDIC

48
Q

Series ____ or Series _____ will qualify an individual to sell municipal securities.

A

Series 7 or Series 52 will qualify an individual to sell municipal securities.

49
Q

What is the appropriate registration designation to supervise the municipal activity for a BD?

A

Municipal Securities Principal (Series 53)

50
Q

True or False: A principal’s written approval must be obtained before the execution of any discretionary orders.

A

False. A principal’s written approval must be obtained on the trade date, but not in advance of the execution.

51
Q

The $100 gift limit may be exceeded if the gift is given to a _______________.

A

The $100 gift limit may be exceeded if the gift is being given to a family member.

52
Q

Is it a violation of industry rule to give a person a gift basket that is valued at $275?

A

Yes. However, if the basket was intended for three persons, it is acceptable.

53
Q

$_____ is the MSRB gift rule limitation.

A

$100 is the MSRB gift rule limitation (same as FINRA).

Series 52 Group Share (24 decks)

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