Regulations - MSRB Rules

Question 1

The MSRB board is composed of _______ and createds regulations applicable to banks, brokers, and dealers who engage in municipal activities

Answer 1

15 members

Question 2

The MSRB has no regulatory authority over ______, just market participants

Answer 2

issuers

Question 3

The MSRB cannot enforce its regulations, so it relies on the ______, ______, and ______ to enforce its rules over banks

Answer 3

Fed reserve board, fed deposit insurance corp, and office of the comptroller of currency

Question 4

The MSRB cannot enforce its regulations, so it relies on the _____ and _____ for broker dealers

Answer 4

SEC and FINRA

Question 5

Muni RR Principals must pass the _____, the prerequisite is the _____

Answer 5

Series 53, rereq is the Series 52

Question 6

For unregistered muni people, you are specifically NOT allowed to _____ orders, ______ new accounts, or ____ from prepared scrips to introduce the services of muni dealers or prequalify customers

Answer 6

solicit orders, solicit new accounts, or read from prepared scripts

Question 7

If a person who is a partner or employee of another muni BD wants to open an account at your firm, the employer must be given _____

Answer 7

written notice

Question 8

When opening accounts for other muni employees, _____ confirmations must be sent to that employer and any written instructions from that employer must be _____

Answer 8

duplicate confirmations sent; written instructions must be followed

Question 9

Muni firms are allowed to enter into ______ agreements for _____ securities

Answer 9

repurchase agreements for exempt securities

Question 10

A BD that acts as the investment adviser to a municipality on their new offer cannot also be an _____-

Answer 10

underwriter

Question 11

For new issues of munis, the BD must send the final official statement (disclosure doc, if prepared), no later than _____ of the transaction

Answer 11

settlement

Question 12

For negotiated offerings, the BD must disclose the _____ to the customer

Answer 12

spread

Question 13

Records of any customer complaints, according to the MSRB, must be kept for ______

Answer 13

6 years

Question 14

A “subject” quote is one that is subject to some _____

Answer 14

condition (usually that the quote has to be re-verified)

Question 15

From a joint account, only one _____ may be published

Answer 15

one quote

Question 16

Factors to consider for both agency AND principal muni transactions:

Answer 16

• best judgement of fair market value
• expense of filling an order
• firm is entitled to a profit
• availability of the security
• total dollar amount of the transaction
• value of services rendered

Question 17

Factors to consider ONLY for principal transactions:

Answer 17

• yield should be comparable to other securities of similar characteristics
• maturity, rating, and call features
• nature of the dealer’s business
• existence of material information through EMMA or other industry sources

Question 18

Factors to consider ONLY for agency trades:

Answer 18

• price of the transaction

- amount of any other comp received in connection with the transaction

Question 19

No later than ___ after the date of sale, the manager of the muni syndicate must disclose in writing to all syndicate members all allocations of securities which were given priority over ______ orders

Answer 19

2 days; priority over member takedown orders

Question 20

Official statements/offering circulars are _____ considered advertising under MSRB, but ______ of those documents are

Answer 20

NOT, but summaries are

Question 21

Each muni advertisement must be approved in advance by a ______ and must be retained for records for _____

Answer 21

by a principal, must be retained for 4 years

Question 22

Muni BDs can contribute no more than _____ per election

Answer 22

$250

Question 23

On a trade confirmation, there is no requirement to disclose the ______ from a national ratings agency

Answer 23

rating of the bonds

Question 24

Does it matter for control disclosures if you are acting as a principal or agent?

Answer 24

NO - does not matter