us government rules and regulations

Question 1

principal of a firm must review and approve:

Answer 1

• account openings
• transactions
• advertising
• correspondence
• customer complaints

Question 2

securities and exchange act of 1934

Answer 2

• people and places act

- regulates broker dealers and requires registration

Question 3

trust indenture act of 1939

Answer 3

• applicable to corporate bond offerings of greater than $5 million in 12 months
• establishes a contract between the issuer and the trustee for the benefit of the bondholder

Question 4

investment company act of 1940

Answer 4

• classified three types of investment companies

- regulates investment companies

Question 5

investment advisors act of 1940

Answer 5

-requires the registration of investment advisors who charge fees for investment advice

Question 6

securities investors protection act of 1970

Answer 6

• protects customers from BD failure

- created the SIPC

Question 7

insider trading and securities fraud enforcement act of 1988

Answer 7

-specifies penalties for inside trading and securities fraud

Question 8

the employee retirement income security act of 1974

Answer 8

-established to prevent abuse or misuse of pension funds

Question 9

telephone consumer protection act of 1991

Answer 9

-protects consumers from unwanted telephone calls

Question 10

bank secrecy act

Answer 10

-establishes the US treasury lead agency developing anti-money laundering programs

Question 11

sarbanes-oxley act of 2002

Answer 11

-requires SROs in the securities industry to establish research analysis conflict of interent rules for its memebers

Question 12

the uniform securities act

Answer 12

• establishes a framework for state registration

- applies to BDs, RRs, IAs

Question 13

regulation S-P

Answer 13

• enacted by SEC to protect the privacy of customer information
• requires privacy notice describing privacy policies

Question 14

regulation SHO

Answer 14

-mandates a locate requirement for securities to be sold short prior to short sales

Question 15

regulation NMS

Answer 15

-enacted to bring trading and reporting uniformity to US security markets

Question 16

regulation A

Answer 16

-small offerings exempt transaction allowing issuers to raise up to $5 mill in a 12 month period with full registration

Question 17

regulation D

Answer 17

• private placement exempt transaction
• up to 35 nonaccredited investors
• accredited investors must meet minimum net worth requirements