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Series 24 made by rich > Test questions > Flashcards

Test questions Flashcards

1
Q

Rule 15c2-1 Commingling

A

Commingled with other customers if consent in writing never commingled with firm securities

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2
Q

Stock Splits

A

Ex date is 1 bd following pay date

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3
Q

Cash Div

A

exdate is 1 bd prior to record date

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4
Q

Rule 506b

A

Limits non accredited investors to 35. excluded from the count relatives if investor in same household anyone classified as accredited investor.
-bus entity or lp where investor owns 50% or more is excluded unless formed solely for purchasing

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5
Q

10b-18

A

Price paid no more than the greater of highest current independent bid or last reported sale

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6
Q

Reduction of excess SIPC coverage

A

Notify customers at least 30 days prior

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7
Q

Dat trading risk disclosure

A

must be given to customers of firms that promote a day trading strategy

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8
Q

OSJ must review accts

A

Review accts periodically and discretionary accts frequently

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9
Q

SMA

A

Customer may use balance to buy 2x that amount in securities.
=excess equities=credit line
Can be released provided no maintenance call

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10
Q

REGX

A

REGt of foreign b/d or reg-u foreign bank

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11
Q

Lending agreements

A

Ap can lend borrow from customer with written approval/notice
Immediate family
biz of lending
Reg with same firm as rep
personal or biz relationship outside of broker/cust relationship

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12
Q

continuous quote rule

A

12 bds during 30 day calendar

no more than 4 consecutive days without quotation

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13
Q

OTBB

A

quotes:

Firm, subj ioi’s one sided and need phone #

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14
Q

Dept of Enforcement

A

Can censure suspend or expel. no jurisdiction over other SRO’s such as regional exchanges

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15
Q

FocusII, IIa

A

within 60 days of fiscal year end

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16
Q

SIPC Assessments

A

based on Gross volumes not by clearing

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17
Q

OTCBB

A

No formal listing standard but must current in filings

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18
Q

Directed Order

A

Used to access a particular quote not a specific mm

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19
Q

Posted on the blotter

A

Receipts and delivery of securities & disbursements of cash must be posted on the blotter the BD following receipt of delivery.

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20
Q

MORC appeal

A

30 mins

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21
Q

Payments to mutual firms

A

3bds of trade or 1 bd of receipt whichever is later

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22
Q

Reclamation from BD

A

is available if member inadvertently accepts a delivery from another member a good but shud have been rejected.

In whole call never subj to reclamation

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23
Q

Needed to open acct

A

Name, address SS, DOB must verify id within a reasonable amount of time before or after account is open.

If no id WSP’s must describe what to do+ take what ever action is necessary

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24
Q

Rule 2330 Variable annuities

A

Recommended purchases and exchanges of deferred ( not immediate) variable and initial sub-account allocations

Doesn’t apply to sub-account a reallocations or additions

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25
Q

QIB’s

A

Pension fund, Bank, Insurance co invest company with Portfolios of $100mm or more. BD’s $10mm or more

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26
Q

Immediate family

A

Spouse parents, brothers, sisters in laws and children

Aunts and Uncles are excluded

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27
Q

OTCBB additional offering period prospectus

A

40 days

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28
Q

OTCBB initial offering prospectus

A

90 days

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29
Q

Nasdaq ipo prospectus

A

25 days additional no requirements for nyse or nasdaq

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30
Q

Prepayment Subordinated loans

A

Approval from DEA
Outstanding 1 year
Capital cant fall below 120%
AI:NC

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31
Q

CFD will comp recvd by under writer?

A

180 days preceding filing

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32
Q

Code of Procedure member can be suspended by whom?

A

NAC or district hearing panel. SEC can modify affirm penalities

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33
Q

Buying power for day traders is?

A

4 maintenance margin excess or sma. $25k initial margin

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34
Q

503 Formd

A

15 days

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35
Q

Maxsize under reg a

A

$50mm 12 month period

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36
Q

Firm will be prohibited from selling a security as principle & buying as agent for a customer if Fail to deliver is how old?

A

60 days or older

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37
Q

Client Dies

A

Death Certificate
Affidavit of domecile
inheritance tax waiver

Power of Atty invalid upon death

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38
Q

FINRA immediate Notification

A

Books and records not current
D/e is at 80% for 100 days

Early warning is net cap below 120%
ai:nc exceeds 12:1

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39
Q

Properly Signed & Guarrranteed stock or Bond Power

A

is a document attached to a certificate authorizing transfer of ownership to another party or when a security is hypothecated

intent to transfer ownership or pledging securities as collateral for a loan

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40
Q

Net Capital rule notification within 24 hours

A

Inadequacy accounting above 12:1 but not above 15:1

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41
Q

Underwriting Compensation

A

No freely transferable stock (180 days restricted)
any right of refusal right longer than 3yrs
options below POP
Option life longer than 5 years

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42
Q

Complaints filed

A

quarterly

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43
Q

Finra rules accept decline trade exceeding limits within how long

A

15 minutes of execution

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44
Q

B/D to prepare trial balances how long

A

Monthly

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45
Q

Rule 147 how long held

A

6 months…or resale to a person within that state

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46
Q

Principle must review

A

Order tickets
retail communications
new account forms

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47
Q

Finra prohibits Investment company secrities from selling below POP unless

A

the buyer is a member firm, selling agreement in writing and is filling a customer order

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48
Q

OTCBB Eligible

A

Foreign securities that are SEC registered, DPP, delisted nasdaq, securities on a regional not eligible for consolidated tape

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49
Q

Eastern Account

A

undivided account which is a shared liability for unsold securities

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50
Q

Blotter pruchase & sale of securities must be posted to a bd blotter…

A

BD following trade date

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51
Q

Stand by purchase agreement

A

3 month lockup
syndicate manager must report in writing
disclosed in final prospectus

52
Q

mediation rules

A

Both parties agree
Either side may withdraw by written notice
no consent is required
mediator is prohibited from serving as arbitrator

53
Q

Converms for DVP

A

no later than t+1

54
Q

Delivery of street name securities

A

will always necessitate an inquiry of SIC

55
Q

SMA

A

Cash deposits increase dollar for Dollar
fully paid for stock increases 50%
Stock Sale 50% is released

56
Q

Inspections at a non supervisory Branch

A

once every 3 years

57
Q

violation of net capital rule exceeds 70% for more than 90 days…what notification is required

A

immediate

58
Q

early warning net cpital

A

exceeds 12:1 and 120% d/e

59
Q

What can finra require

A

Provide info orally writting or electronically.
give testimony under oath
provide access to or copies of books and/or accounts

60
Q

SIC

A

Street name always requires inquiry

exception is member to member

61
Q

Rep letters 5130

A

Initial verification
positive affirmation annual
negative consent

62
Q

Stabilization- notice must be given where?

A

Prospectus and registration statement

63
Q

Customer orders that improve a MM price or size must be displayed when?

A

immediately ( within 30 seconds)

64
Q

SAR is filed when?

A

within 30 days

65
Q

Form 3 filed when?

A

10 days

66
Q

REGS holding period

A

1 year or 6 months if reporting

67
Q

Partnerships are frozen when

A

Death of GP

68
Q

FocusIIa

A

quartely within 17 bds

69
Q

Excluded from definition of Branch office

A

Location of convenience
temp location as part of BCP
Back Office

For primary residence to be excluded ap must not meet clients at location

70
Q

Trailer Commission

A

12b-1 fee charged by mutual funds RR receives %

71
Q

Non Directed order

A

Liability orders creates obligation to buy or sell. Market orders or marketable limit orders

72
Q

5130 doesnt apply to members new issue employees but does apply to

A

employees of other member firms

73
Q

PB min equity is

A

$500k min net capital is $1.5

74
Q

When a bd suspects securities are lost & missing it has?

A

2bds 3rd subsequent bd to report loss to sic & transfer agent

75
Q

Halts S&P 500

A

7, 13, 20

76
Q

What is cxled on reverse split

A

Open orders above and below market

Forward split shares increased / price decrease

77
Q

FINRA prohibits repurchase agreements in….

A

nonexempt securities

78
Q

Market halt how are regular orders and MOC treated

A

market limit orders are treated as GTC and held for execution the following day

MOC are cxled

79
Q

Cost net capital MM’s

A

$5 and greater is 2500
5 and less 100

Min 100k and max 1mm

80
Q

12b-1 fees can cover

A

cost of marketing and compensate sales personnel

81
Q

rule 147

A

Stop s\transfer instructions to the agent barring certificate, cancellation & re-issuance in name of any non resident
Legend not registered with sec act of 33
obtain a a written representation of residence

82
Q

Fairness opinion

A

Material relationship last 2 years
member receive comp contingent on completion
inform that opinion came from party requesting opinion
acted as financial adviser to transaction
issued or approved by fairness committee

83
Q

Complaint from dea who long to respond

A

25 days

84
Q

Customer complaints kept for how long?

A

4 years

85
Q

1940 inv company act the 75/5/ 10 rule

A

75% invested
5% or less of assets in any one security
10% or less voting stock in any 1 issue

86
Q

Unit trusts are what

A

close ended

87
Q

Municipal trusts are?

A

diversified in terms of coupon, rating issuer and maturity

88
Q

what securities are act reported

A

Converts
CQS securities
BB equities

High yield are reported thru trace

89
Q

Members cant charge for…

A

forwarding proxies and for research

90
Q

TRACE hours

A

8-6:30 with in 15 minutes of close… then within 15 minutes of open

91
Q

FINCEN Form 112

A

10k or greater cash

92
Q

TRACE who reports?

A

both parties…buyer and seller

93
Q

Are margin securities subj to possession or control requirements?

A

no because they are at a bank collateralizing customer debit balances

94
Q

.U

A

trades between midnight and 7:59:59 reported after normal market hours

95
Q

*K filed when?

A

4bd’s after an event

96
Q

Mutual fund Financial statements filed when?

A

at least semi-annually

97
Q

Fidelity Bond

A

highest required net capital over 12 months

98
Q

TIC dies

A

Freeze account interest goes to estate

99
Q

Insider trading penalties

A

25mm for firms 5mm for natural persons

100
Q

If customer pays prior to settlement date….

A

transaction is not complete until securities are delivered into account

101
Q

Seasoned issuer

A

must have a public float of $75mm

102
Q

Stabilizing Bid

A

Notifiy exchange
penalty free or penalty
copy of prospectus
short covering

103
Q

Review of securities at a b/d may be risk based

A

must be able to id & prioritize those trades which pose greatest chance of rule violation

104
Q

PMM exceeds its net dailly purchase

A

30% must seek excused withdrawal remaining of the day

105
Q

b/d does not hold customer funds or securities

A

it is exempt from reserve requirement

106
Q

BD has reported an erroneous trade to trf

A

Nasdaq will issue a written determination
aggrieved party 30 minutes to appeal
nasdaq null, void decline to act or adj trade

107
Q

When does NASDAQ need to be notified of POP price

A

by 6:45pm the night before

108
Q

Adj for divididends

A

those entered below market

buy limits and sell stops

109
Q

Form 211 when

A

3 bds prior to entering quotes

110
Q

Retails comms must disclose

A

if was a manager or co-manager of a public offering in security preceding 12 months

111
Q

Subsidiary ledgers kept for how long

A

3 years

112
Q

Sar $ amount threshold?

A

$5k

113
Q

Interest corporate bonds

A

Begins to accrue on prior int payment date upto but including settlement date

114
Q

Issuers must notify how many days before record date

A

10 days

115
Q

DVP close out

A

35 days

116
Q

physical delivers are made where?

A

office of buyer…seller incurs expenses

117
Q

BD just terminated accountant…who must they notify?

A

FINRA and SEC within 15 bds

118
Q

Blotters

A

Daily purchases & sales
receipts and delivery of securities
distro of cash
as well as id of account for which each trade is effected.

Commissions are not on blotter

119
Q

Series 27

A

Fin ops principal

120
Q

Customer occupation and tax id must be obtained prior

A

to 2nd sd of initial transaction

121
Q

AML compliance program approved by whom?

A

Senior management of firm not required to be a registered individual most be monitored by an ap

122
Q

Cold calling

A

8am to 9pm

123
Q

A short sale effected the day before the ex div date will result

A

being paid to the buyer

124
Q

SS occurs on the exdate

A

the dividend will be paid to the lender

125
Q

Oats does not include

A

CRD number

126
Q

Carrying BD must have physical possession or control of

A

fully paid and excess margin securities

Series 24 made by rich (7 decks)

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