Section 4 of 14 - Supervising the Firm and Its Agents

Question 1

Which securities act requires membership?

Answer 1

Securities Act of 1934

Question 2

Members must pay dues based on what?

Answer 2

OTC transaction revenue

Question 3

All non-members and suspended members are treated as what?

Answer 3

the general public

Question 4

Members of FINRA (formerly NASD) may not use membership for what?

Answer 4

to imply endorsement

Question 5

Individuals begin registration by submitting what 2 things and to whom?

Answer 5

1) U4 2) fingerprints 3) submitted to FINRA via the central registration depository (CRD)

Question 6

Individuals who have been convicted of a securities or money related crime within the last _____ years may not apply.

Answer 6

10

Question 7

Upon termination, what form is required and to whom is it submitted?

Answer 7

U5 to FINRA via CRD within 30 days of termination

Question 8

The rep receives a copy of the U5 from whom?

Answer 8

the old employer

Question 9

Agents who leave the business for how many years must be requalified by exam?

Answer 9

2 years

Question 10

All reps must be assigned to who?

Answer 10

a principal

Question 11

Are employees who handle orders or supervise a member’s business required to be registered?

Answer 11

yes

Question 12

Are employees who are not involved in the firm’s securities business required to be registered?

Answer 12

no

Question 13

Can an agent be registered as an agent of more than one firm?

Answer 13

under limited circumstance and if approved by both firms

Question 14

Series 6?

Answer 14

Investment Company/Variable Contracts

Question 15

Series 7?

Answer 15

General securities

Question 16

Series 11

Answer 16

Registered Assistant

Question 17

Series 55

Answer 17

Equity Trader

Question 18

Series 62

Answer 18

Corporate Securities Limited Rep

Question 19

Series 86/87q

Answer 19

Research Analyst

Question 20

Series 4

Answer 20

Option Principal

Question 21

Series 24

Answer 21

General Securities Principal

Question 22

Series 26

Answer 22

Investment Company/Variable Contracts Principal

Question 23

Series 27

Answer 23

Financial and operations Principal

Question 24

what are the CE requirements?

Answer 24

second anniversary of registration and every three years thereafter (120 days to complete)

Question 25

Firm element training is how often?

Answer 25

annual

Question 26

What is selling away?

Answer 26

a recommendation to a customer that involves an investment product that is not offered through the employing firm without the firm’s knowledge and consent. This is a violation of industry regulation/

Question 27

What is required for an agent to engage in a private securities transaction?

Answer 27

firm’s prior approval

Question 28

If an agent is receiving compensation for a transaction such as a private placement, what is required of the firm?

Answer 28

the firm must supervise the transaction and all payments to be received by the agent must run through the firm

Question 29

For outside employment what is required for FINRA (NASD) members?

Answer 29

notification to employers

Question 30

For outside employment what is required for NYSE member employees?

Answer 30

prior permission from employer

Question 31

An residence is not considered a branch office if:

Answer 31

1) there is no identifying sign
2) there agent resides there with an immediate family member (or alone)
3) securities and funds are not received there
4) there is no stationary with the firms name
5) all emails are sent through the firms system
6) agents working from home are assigned to a branch
7) no meetings with clients take place

Question 32

an office is an OSJ if:

Answer 32

1) there is a trading deskl
2) deals are structured or financed
3) clearing or custody takes place
4) a principal approves accounts, orders, etc at this location
5) a principal at the location supervises other branches

Question 33

what are the requirements if an office is an OSJ

Answer 33

1) supervised by a principal
2) maintain a customer complaint file
3) subject to annual inspection

Question 34

what is advertising?

Answer 34

any form of public communication where the firm does not control the audience, i.e, TV, radio, websites, newspaper

Question 35

What is sales literature?

Answer 35

targeted communication, i.e, research reports, market circulars, and e-mail

Question 36

what is correspondence?

Answer 36

written communication in paper or electronic sent to fewer than 25 prospects in a 30 day period

Question 37

All advertising and sales literature must be approved by a principal when?

Answer 37

prior to its first use

Question 38

Options and CMO ads are required to be filed when?

Answer 38

10 days prior to use

Question 39

Mutual funds are required to file ads when?

Answer 39

10 days after first use

Question 40

B/D less than one year old or who have not previously filed ads in the past are required to file when?

Answer 40

10 days prior to first use

Question 41

What is neither advertising nor sales literature?

Answer 41

internal memos, tombstone ads, prospectus, a single e-mail

Question 42

A rep in a chat room is considered what?

Answer 42

a public appearance

Question 43

A public website is

Answer 43

advertising

Question 44

a password protected website is

Answer 44

sales literature

Question 45

emails and instant messages to more than 25 people are

Answer 45

sales literature