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Flashcards in GPFP - 10 Deck (28)

Which act requires registration with the SEC by certain investment advisors?

Investment advisers of 1940


An investment advisor who is subject to the registration requirement is anyone who is:

1) in the business
2) of providing advice about securities
3) for compensation


A security includes almost any type of financial investment with what notable exception?

Most fixed life insurance and annuity products


Which act does not require you to be a registered investment advisor if: an advisor whose only clients are venture capital funds, a foreign advisor without a US office or other place of business that manages less than $___ of client assets or has fewer than 15 US clients.

Dodd-Frank Act of 2011


Under the Dodd Frank act, if advisor manages between ___ & ___ million of client funds, he or she may elect to register with the S EC or with his or her state.

$100 and $110 million


The investment advisor term must make an initial filing with the SEC of Form ___, Parts I and II, and pay a filing fee. Each year, the firm must file ____. If the firm ceases operations, it must file ___.

Part I


It is not permissible to use which initials?



The brochure (___) must be distributed ___ hours prior to the signing of the investment advisory contract or ___ the investment advisory contract is signed, in which case the client may cancel the agreement within ___ days.

ADV, Part 2A
At the time


Persons excepted from the registration requirement with the SEC:

Accountant, lawyer, teacher, engineer
Government securities advisor


Persons exempted from the registration with the SEC:

Intrastate clients only
Insurance company clients only
Only 15 clients in the last 12 months


FINRA was formerly?



FINRA Examination – for investment company products and variable life insurance and variable annuity products

Series 6


FINRA Examination – for all investment products except commodities and certain options

Series 7


FINRA Examination – for tax shelters other than real estate investment trusts, i.e., not our REITs.

Series 22


FINRA Examination – in conjunction with Series 6 and 22, for all investment products except options

Series 62


FINRA Examination – For state licensing in many states

Series 63


FINRA Examination – for registered investment advisers at the state level

Series 65


___ our state laws dealing with the regulation of the securities business.

Blue sky laws


Federal securities law – focuses on disclosure concerning offers of new issues; requires that they be registered with the SEC; provides for distribution of a prospectus to interested investors, as well as a preliminary prospectus prior to approval of the new issues' registration statement by the SEC.

Securities act of 1933


Federal securities law – Focuses on the trading of existing security's; created the SEC to police market manipulation, deception, and misrepresentation; requires periodic reports (Form 10-K) by publicly held securities issuers to the SEC; gave the SEC control of the securities exchanges and, later, the over-the-counter market.

Securities exchange act of 1934


Federal securities law – allows for the formation of self-regulatory organizations to police the securities industry under the supervision of the SEC; the NASD (now called FINRA) is the only such organization to have been formed and approved.

Maloney act of 1938


Federal securities law – requires registration of investment companies with the SEC; provides for ongoing regulation of their disclosures and procedures.

Investment Company act of 1940


Federal securities law – created the SIPC to ensure cash and securities held in "street name" in brokerage houses that fail.

Securities investor protection act of 1970


Federal securities law – called for the development of a competitive national system for trading securities; led to the abandonment of fixed brokerage commission rates.

Securities act amendments of 1975


Federal securities law – prohibits use of inside information in securities purchases and sales.

Insider trading and securities fraud enforcement act of 1988


Federal securities law – requires companies to give customers the right not to have their information shared with unrelated third parties

Gramm-Leach-Bliley Act of 1999


Federal securities law – stops terrorists from using funds held in US financial institutions for illegal activities.

International money laundering abatement and financial anti-terrorism act of 2001


Federal securities law – addresses accounting fraud and financial disclosures and established the Public Company Accounting Oversight Board to supervise accounting firms and audits.

Sarbanes-Oxley Act of 2002