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Series 10 > Part 1: Supervision of Associated Persons & Personnel Management Activities > Flashcards

Part 1: Supervision of Associated Persons & Personnel Management Activities Flashcards

1
Q

FINRA is authorized by ___________

A

Congress

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2
Q

Which 2 forms must a firm electronically file to become a FINRA member (in addition to other requirements)?

A

New Membership Application (NRA) & Form BD

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3
Q

_____ maintains info on all persons registered with FINRA, including information on customer complaints, arbitrations, and disciplinary history.

A

Central Registration Depository (CRD)

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4
Q

What 2 things will the U4 never ask?

A

Marital and educational status

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5
Q

Form U4 requires how many years of employment history?

A

10 years

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6
Q

Form U4 requires how many years of your residential history?

A

5 years

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7
Q

Form U4 requires how many years of history regarding securities convictions?

A

10 years

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8
Q

How soon must updates be made to the U4 before late feels will be charged?

A

30 days

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9
Q

How many years must a firm keep a copy of a RR’s U4, after their termination?

A

3 years

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10
Q

If there is a statutory disqualifying event, how many days do you have to update Form U4?

A

10 days within learning of it

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11
Q

A person’s former employers for the past ____ years must be contacted to check the accuracy of their records and information given regarding a U4.

A

3

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12
Q

If a BD is approached by a potential employer for one of their former employers, how many days do they have to furnish the requested information?

A

10

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13
Q

What is a Form U5?

A

The form filed when a RR is terminated or resigns.

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14
Q

If a member firm files a U5 and then learns of facts that would necessitate a change in the U5, how many days to they have to file an amended U5?

A

30

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15
Q

Who provides the U5 to the new employing member firm?

A

Either the employee or FINRA’s Web CRD.

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16
Q

If requested, how many days does the new employee have to provide the Form U5?

A

2 days, unless they don’t have it yet, but when they get it they have 2 days.

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17
Q

What is the Form U6?

A

When BDs and APs are disciplined, the regulators file the U6 to report the action. Can also be used to report final arbitration awards.

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18
Q

How many years are someone’s licenses valid after leaving the industry?

A

2 years

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19
Q

Securities Industry Essentials (SIE)

A

intro-level exam, basic securities concepts. Passing this alone does not qualify an individual for registration. They must pass this and a qualification exam.

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20
Q

Series 6

A

Investment Company and Variable Products Representative - allows the holder to offer investment company products and variable contracts by prospectus (MF’s, UIT’s, etc)

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21
Q

Series 7

A

General Securities Rep - allows the holder to offer all types of securities subject to approved business lines of the BD.

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22
Q

Series 22

A

Direct Participation Programs Representative - allows the holder to sell DPP’s such as limited partnership interests

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23
Q

Series 52

A

Municipal Securities Rep - qualifies a rep to offer municipal securities, muni fund securities. Also covers US Government, Federal agency, and other financial instruments

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24
Q

Series 57

A

Securities Trader Exam - allows the holder to trade OTC equity and convertible debt securities.

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25
Q

Series 86

A

Research Analyst - allows the holder to prep research reports, specifically for analysis

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26
Q

Series 87

A

Research Analyst - focuses on rules and regulations

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27
Q

Series 99

A

Operations Professional - for those required to supervise or manage client on-boarding in addition to funds collection, maintenance, disbursement, etc.
*Note: You may register as OP’s if you have the 6, 7, or 24, etc.

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28
Q

How many resident principals are required at each OSJ?

A

1

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29
Q

If the branch relocates or a new one opens, how many days to notify FINRA by filling out Form BR?

A

30

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30
Q

When do firms need to review (and if necessary, update) their contact information each year?

A

Within 17 business days of the end of each calendar year.

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31
Q

Series 4

A

Options Principal - allows individuals to supervise the BD’s options business

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32
Q

Series 9/10

A

General Securities Sales Supervisor - allows registrant to supervise sales efforts of a member firm.

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33
Q

Series 14

A

Compliance Officer - Chief Compliance Officers. This is one of few exams that has no prerequisite.

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34
Q

Series 24

A

General Securities Principal - can supervise most activities of a firm: trading, market making, investment banking, sales. Can also approve retail communication.
Req. before taking the series 51

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35
Q

Series 26

A

Investment Company/Variable Products Principal - can function as a principal for the solicitation, purchase, and sale of redeemable investment company securities and variable contracts.

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36
Q

Series 27

A

Financial and Operations Principal - allows them to supervise the preparation of the firm’s financial and operational reports.
No prerequisite.

37
Q

Series 51

A

Municipal Fund Securities Principal - allowed to supervise activities in muni fund securities (ex: 529s).
Prereq: Series 24 OR 26

38
Q

Series 53

A

Municipal Securities Principal - to supervise the purchase and sale of muni securities. All FINRA/MSRB engaged in muni business must have at least 1.

39
Q

Series 79

A

Investment Banking Rep - can perform the functions of an investment banker….advising on or facilitating debt or equity offerings thru a private placement or IPO.

40
Q

Who administers the test necessary for NYSE floor brokers, clerks, and DMM’s?

A

The NYSE

41
Q

How many days must a person wait before retesting, if they have failed the exam 4+ times?

A

180 days

42
Q

How often do municipal brokers or deals need to be examined (audited)?

A

At least once every 4 years

43
Q

Under Code of Procedure rules, an appeal of an adverse decision must be made within how many days of the decision date?

A

Within 25 days

44
Q

A report must be filed with FINRA promptly, but no later than 30 calendar days, after the member knows (or should have known) of the existence of a complaint against a registered representative alleging ____, _____, or _____.

A

forgery, theft, or misappropriation of customer assets

45
Q

A registered representative admits to a minor rule violation and signs an acceptance waiver and consent. What is the maximum penalty?

A

$2500

46
Q

Exchange Traded Notes (ETN’s) are subject to the registration requirements of the ______.

A

Securities Act of 1933

47
Q

Contributions of up to ____ per election are permitted if the contributions are made by Municipal Finance Professionals eligible to vote for that official.

A

$250

48
Q

Which rule prohibits muni firms from engaging in muni securities business with an issuer for 2 years after a contribution is made to an official of that issuer by the muni firm, any MFP associated with the firm, non-MFP executive officers, PAC’s controlled by the firm, or bond ballot contributions?

A

Rule G-37

49
Q

Which rule requires that the member firm be contacted in writing and duplicate confirms sent if an account is opened for an employee of another member firm?

A

Rule G-28

50
Q

How often do reports need to be filed with the MSRB on Form G-37 detailing all contributions made by the dealer and its professionals?

A

Quarterly. Filed by the last day of the month following the end of each calendar quarter.

51
Q

How many exemptions to G-37 can be granted for one MFP?

A

Only one. The BD may not take advantage of more than one automatic exemption for political contributions made by the same MFP.

52
Q

How many exemptions is a BD entitled to for a 12-month period?

A

2 automatic exemptions (can’t be the same MFP)

53
Q

When may a broker-dealer submit Form G-37x?

A

If they have not engaged in municipal securities business for 8 consecutive quarters, they may become exempt from most of the requirements of Rule G-37.

54
Q

How long must copies of Form G-37 be maintained?

A

6 years

55
Q

What is FINRA’s rule regarding political contributions?

A

FINRA Rule 2030

56
Q

Regarding FINRA Rule 2030, what is the contribution limit to any official per election?

A

$350

57
Q

Regarding FINRA Rule 2030, if the covered associate is not entitled to vote for the official at the time of contribution, what is the maximum contribution amount per election?

A

$150

58
Q

Which report is the annual report that details the member firms’ supervisory control systems?

A

Rule 3120 Report

59
Q

How long must the designation record be maintained?

A

for 6 years after any change is made.

60
Q

MSRB Rule _____ states that all municipal firms must deal fairly with all persons and not engage in any deceptive, dishonest, or unfair practice

A

Rule G-17

61
Q

How often must a non-OSJ branch be reviwed/audited?

A

At least once every 3 years.

62
Q

Reviews of office inspections must be in writing and kept for ___ or more years.

A

3

63
Q

How often must a FINRA staff member audit municipal broker-dealers that are members of FINRA?

A

Once every 4 calendar years.

64
Q

A dispute between a registered representative and his customer that results in a settlement exceeding $_____ or in commissions in excess of $____ being withheld by the firm, must be reported to FINRA promptly, but no later than 30 days after the event.

A

$15,000; $2,500

65
Q

All managers of OSJ offices must be registered as a _______

A

principal.

66
Q

In a competitive offering of municipal bonds, the issue is usually awarded to the syndicate that offers to sell the bonds ______________

A

with the lowest net interest cost to the issuer.

67
Q

True or False: The MSRB has no enforcement authority.

A

True!!!!
They create & interpret rules.

68
Q

The Series 7 license permits a representative to sell virtually any security. One exception to this is: __________

A

commodity futures

69
Q

Upon validating customer municipal securities accounts after transfer instructions have been received, how many business days until the transfer of the account must be completed?

A

3 business days

70
Q

Is a limited partnership unit considered a passive investment?

A

Yes. Therefore, the prohibitions against outside business activities do not apply.

71
Q

After giving __ days’ written notice, FINRA may suspend or revoke the membership of any member in arrears in the payment of fees, dues, assessments, or other charges

A

15

72
Q

Members must file notice with FINRA to report securities- or commodities-related judgments, awards, or settlements of $___ or more against individuals and $___ or more against member firms.

A

$15k; $25k

73
Q

Under the Code of Procedure, a respondent must reply to the hearing officer within ___ days of receiving a complaint.

A

25

74
Q

Principal designation records must be maintained for __ years.

A

6

75
Q

A municipal bank dealer with eleven or more associated persons requires __ principals, unless the firm belongs to another registered securities association.

A

2

76
Q

The 24-month time restriction on bidding in municipalities in which prohibited political contributions were made pertains to [negotiated bids or competitive bids?]

A

negotiated bids. They may submit competitive bids

77
Q

An associated person of a municipal dealer who supervises the preparation of financial reports that must be filed with regulators must have passed the Series __

A

27 - Financial and Operations Principal

78
Q

A member firm may grant discounts, concessions, or other allowances to _____

A

a foreign nonmember ineligible for FINRA membership.

79
Q

True or False:
The MSRB has no jurisdiction over issuers.

A

True

80
Q

OTC securities report to FINRA on the ____

A

ORF (over the counter reporting facility))

81
Q

A member can grant discounts and other concessions only to __________.

A

other member firms.
The only exception is that a member firm can grant concessions to a foreign nonmember firm that is ineligible for FINRA membership.

82
Q

Non-public arbitrators are people who have in the past five years devoted __% or more of their time servicing the securities industry.

A

20

83
Q

Your firm must provide FINRA an update to any change in emergency contact persons within how many days?

A

30

84
Q

FINRA Rule 2165 permits firms to place a temporary hold (__ business days) on disbursements from the accounts of individuals aged 65 or older; and individuals aged 18 or older whom firms reasonably believe have an impairment that prevents them from protecting their own interests (a specified adult).

A

55 (this was amended March 2022)

85
Q

FINRA requires fingerprints to be kept for _____

A

3 years after the employee’s termination

86
Q

MSRB requires fingerprint cards to be kept for ______

A

4 yrs

87
Q

To calculate how low the market value may drop before a client would be at the minimum maintenance requirement, divide the debit balance by __%.

A

75%
ex: ($15,000 ÷ .75 = $20,000)

88
Q

Time extensions for a Regulation T margin calls are requested from ___

A

the SRO

Series 10 (4 decks)

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