Regulators Flashcards
What does the SEC reg
BDs transacting sec bus with customers or other BDs
exchanges
Issues
client protection and insider trading
What is FinCEN
financial crimes enforcement network
combat money laundering
other illegal money moves
promote national security of finan intelligence
Is the abreviation for Office of the Comptroller of the Currency OCC
no that stands for Options Clearing Corporation
What act regs packaged products like mut funds, closed end funds, and UITs
Investment Comp Act of 1940
What act regs BDs from bankruptcy
Sec Invs Protection Act of 1970
All BDs that are regd with the SEC must also be regd with and who are exempt
SIPC
banks that only deal with munis or US gov secs
firms dealing exclusivily in redeemable investment comp secs
What does SIPC do
is notified of a problem BD, investigates, if find failure, court orders trustee to liquidate the firm
What is considered a separate acc for SIPC
Johns acc and his custodian acc for Jane Doe are separate
having another margin acc is not separate
What does SIPC cover in margin accs
only the equity
What amount does SIPC cover
500k per separate acc, up to 250k of cash
What is a consid for SIPC and a BDs advertisign
must mention but cant overstate SIPC benefits or uniqueness to that BD
must have sign on premise
font cant be bigger than the firms name
They first word in SIPC is security what does it only cover
secs
options have a sec inderlying so they are covered
What is a rule for new clients set by SIPC
must disclose info on SIPC can be gained by contacting SIPC
and once yearly
What is the FDIC
Federal Deposit Insurance Corp
insures deposits at banks max 250k PER PERSON
So indivi acc and joint acc both get 250k coverage
What does FINRA reg
investment banking (sec underwriting)
OTC markets
licensing of sec representatives
other stuff same as SEC
People who work for FINRA are often called
associated person
member firms of FINRA can only what and what are the exceptions
work with other FINRA members
bank underwriting munis
foreign firms tthat are members of their FINRA equivalent
Exchanges have the power to
freeze trading or delist a sec
What records are kept indefinitely
Partnership agreements
corp charter
stock certificate books
minutes
amendments
organizational records like a Form BDW
What records need to be kept for 6 years
generally the holdings of the firm and its customers
financial records
blotters - essentially actions taken on investments
general ledger of balance sheets
stock record
customer ledgers and account documents
Appointments of principal
What records are held for 4 years
written complaints
What records are held for 3 years
mostly anything else
Consid for 3 and 6 year records
first two they need to be readily available so not off site
