MSRB Rules Flashcards
What can the MSRB do, and not do?
The MSRB CREATES rules for municipal firms. They do NOT:
- Regulate issuers
- Enforce the rules that it creates
Who enforces the MSRB rules for banks?
- Federal reserve
- FDIC
- OCC
What is the municipal securities principal’s obligations?
They are directly engaged in management, and perform overall supervision. They must pass the Series 52.
What is the municipal securities representative’s obligations?
Person that is not a principal, their responsibilities include:
- Underwriting, trading, and ales
- Research investment advice
- financial advisory and consulting
How long does a person have to pass the Series 52 before they are fired by a Municipal dealer?
180 days after associating
Who must perform overall muni dealer supervision?
Municipal #53 principal
What must be kept in each office of an MSRB firm?
A copy of the MSRB Manual
Can a financial adviser act as an underwriter in the issue of a municipal offering?
No - it does not matter if it is competitive or negotiated
When is a new issue disclosure required to be sent to the customer with the Final official statement?
If it is prepared by the issuer. If final version is not ready, or won’t be prepared in final form a notice that no official statement is being prepared must be sent
When is the spread on Municipal offerings disclosed?
On NEGOTIATED offerings
When is the spread on municipal offerings NOT required to be disclosed?
On COMPETITIVE bid issues (since the spreads are so narrow)
What must be sent to the customer when a complaint regarding a municipal investment is received?
An Investment Brochure must be sent to the customer
How long must complaints to municipal dealers be retained per the MSRB?
Muni complaints must be retained for 6 years
How many quotes can a joint account publish?
ONLY ONE
What is the order in which municipal syndicates must fill orders?
PGDM
- Pre sale
- Group net
- Designated
- Member
For which type of muni. order must the identify of the customer for whom the order is filled be disclosed to the manager?
Group net orders
Which type of muni. order designates that one syndicate member receives extra profit allocation to complete sale of the issue?
Designated net orders
What is a member takedown order?
These are any bonds that remain that manager confirms as unsold to syndicate members
What must the manager disclose to syndicate once the syndicate is settled?
- Syndicate expenses
- Identity and size of portfolio
- Group order
- Aggregate value and price of securities sold
What does the MSRB consider advertisements?
Notice, circulars, and abstracts
How long are MSRB advertisements retained?
4 years
What yields can be shown on a municipal advertisement?
They can show yields that change if the date is shown on the advertisement. If it shows yields, it should state that Yield to Maturity or Yield to call
What must be included on municipal bond advertisements?
A statement that the securities may already be “sold out” or unavailable
What is the max amount for contributions made to elected officials by municipal firms?
$250 dollars
