GPFP - 10 Flashcards
An investment advisor who is subject to the registration requirement is anyone who is:
1) in the business
2) of providing advice about securities
3) for compensation
Which act requires registration with the SEC by certain investment advisors?
Investment advisers of 1940
A security includes almost any type of financial investment with what notable exception?
Most fixed life insurance and annuity products
Which act does not require you to be a registered investment advisor if: an advisor whose only clients are venture capital funds, a foreign advisor without a US office or other place of business that manages less than $___ of client assets or has fewer than 15 US clients.
Dodd-Frank Act of 2011
Under the Dodd Frank act, if advisor manages between ___ & ___ million of client funds, he or she may elect to register with the S EC or with his or her state.
$100 and $110 million
The investment advisor term must make an initial filing with the SEC of Form ___, Parts I and II, and pay a filing fee. Each year, the firm must file ____. If the firm ceases operations, it must file ___.
ADV
Part I
ADV-W
It is not permissible to use which initials?
RIA
The brochure (___) must be distributed ___ hours prior to the signing of the investment advisory contract or ___ the investment advisory contract is signed, in which case the client may cancel the agreement within ___ days.
ADV, Part 2A
48
At the time
Five
Persons excepted from the registration requirement with the SEC:
Bank Accountant, lawyer, teacher, engineer Broker-dealer Publisher Government securities advisor
Persons exempted from the registration with the SEC:
Intrastate clients only
Insurance company clients only
Only 15 clients in the last 12 months
FINRA was formerly?
NASD
FINRA Examination – for investment company products and variable life insurance and variable annuity products
Series 6
FINRA Examination – for all investment products except commodities and certain options
Series 7
FINRA Examination – for tax shelters other than real estate investment trusts, i.e., not our REITs.
Series 22
FINRA Examination – in conjunction with Series 6 and 22, for all investment products except options
Series 62
FINRA Examination – For state licensing in many states
Series 63
FINRA Examination – for registered investment advisers at the state level
Series 65
___ our state laws dealing with the regulation of the securities business.
Blue sky laws
Federal securities law – focuses on disclosure concerning offers of new issues; requires that they be registered with the SEC; provides for distribution of a prospectus to interested investors, as well as a preliminary prospectus prior to approval of the new issues’ registration statement by the SEC.
Securities act of 1933
Federal securities law – Focuses on the trading of existing security’s; created the SEC to police market manipulation, deception, and misrepresentation; requires periodic reports (Form 10-K) by publicly held securities issuers to the SEC; gave the SEC control of the securities exchanges and, later, the over-the-counter market.
Securities exchange act of 1934
Federal securities law – allows for the formation of self-regulatory organizations to police the securities industry under the supervision of the SEC; the NASD (now called FINRA) is the only such organization to have been formed and approved.
Maloney act of 1938
Federal securities law – requires registration of investment companies with the SEC; provides for ongoing regulation of their disclosures and procedures.
Investment Company act of 1940
Federal securities law – created the SIPC to ensure cash and securities held in “street name” in brokerage houses that fail.
Securities investor protection act of 1970
Federal securities law – called for the development of a competitive national system for trading securities; led to the abandonment of fixed brokerage commission rates.
Securities act amendments of 1975
Federal securities law – prohibits use of inside information in securities purchases and sales.
Insider trading and securities fraud enforcement act of 1988
Federal securities law – requires companies to give customers the right not to have their information shared with unrelated third parties
Gramm-Leach-Bliley Act of 1999
Federal securities law – stops terrorists from using funds held in US financial institutions for illegal activities.
International money laundering abatement and financial anti-terrorism act of 2001
Federal securities law – addresses accounting fraud and financial disclosures and established the Public Company Accounting Oversight Board to supervise accounting firms and audits.
Sarbanes-Oxley Act of 2002
