Series 63 - Based on Class Summary Flashcards
The administrator can deny/suspend/revoke a registration if (4 things):
- if, within the last 5 years, the agent had a registration denied or revoked by a foreign securities regulator
- if the person was convicted of a security- or money-related crime or any felony within the past 10 years (120 months)
- if the applicant has already been banned from the securities industry by another jurisdiction
- based upon a FINRA, NYSE, or SEC action against the firm, even if the violation is not a violation in the administrator’s state
Can an administrator seek evidence across state lines, require affidavits to be filed, and revoke non-profit security exemptions such as securities issued by a church or university?
YES
Does a cease and desist order require prior notice?
No
Can an administrator deny a registration based solely on lack of experience or company history?
No
Can an administrator put a person in jail, issue a search warrant, or revoke a registration without providing notice to the disciplined party and a hearing if requested by the respondent?
No
Does a stop order require prior notice and a hearing to prevent registration of a security in the state?
Yes
When will an administrator have jurisdiction over an offer in a state?
(1) originates in the state
(2) directed in the state
(3) accepted in the state
While a security’s registration statement is effective, how often may the Administrator require ongoing reports on the progress of the offering?
- quarterly basis
- USA does not permit reports be required more often than that
A final order suspending or disciplining a securities professional requires three things:
(1) prior notice to the securities professional
(2) opportunity for a hearing
(3) written findings of fact
Administrator can issue _____ to compel testimony, but cannot issue an _____.
subpoenas; injunction
Civil penalties for violations of the USA include interest as of the _______ date of the transaction, not the trade date, sale date, or settlement date.
PAYMENT DATE
NASAA Model Rules require firms to maintain records the first ____ years of which must be on-site. The firm must also separately store a duplicate copy of all records for the time period.
two years
Static vs. Interactive Content (social media)
- “Static” content requires pre-approval
- “Interactive” content must be monitored for compliance. This content allows other users to comment on, reuse, or “like”
What is a “contrivance”?
any scheme or program or plan to defraud
Agents can borrow money from/lend money to clients ONLY if the client is a _______.
Financial institution (i.e., bank). cannot lend to a customer in any other circumstance, even if the customer is a family member
Higher-than-normal commissions are permitted when…
justified by the transaction and with advance notice to the client
What does the UPIA (Uniform Prudent Investor Act) govern?
- Trustees and trust investments
- provides that trustees owe a fiduciary duty to the trust’s beneficiaries, not the trust’s grantor
What do BDs and agents need to exercise discretion?
-require WRITTEN power of attorney
What do IAs and IARs need to exercise discretion?
-can exercise discretion for 10 business days after the first transaction on oral power of attorney, but written authority is required thereafter
The six main items that are NOT securities under the USA include:
(1) commodities/future contracts for commodities
(2) collectibles
(3) currency
(4) condo used as personal residence
(5) retirement plans
(6) fixed annuity, insurance policy, or endowment contract
