New Accounts

Question 1

New accounts information requires?

Answer 1

Customer’s personal info (name, address, legal age, RR info, principal signature

Question 2

Not needed to open customer account

Answer 2

customer signature

Question 3

how many days are given to send customer their copy of the new account info?

Answer 3

30 days

Question 4

how many years do RR keep a customer’s account record for?

Answer 4

6 years

Question 5

US Patriot Act

Answer 5

protect americans against terrorists

Question 6

Info needed for Patriot Act

Answer 6

Name, address, SSN/Tax ID, birth
OR
Passport

Question 7

What info is not required for Patriot Act?

Answer 7

Drivers License info

Question 8

CIP - Customer Identification Program

Answer 8

checks for customer identity and prevents anti money laundering and terrorists

Question 9

How many years do CIP info is kept for?

Answer 9

5 years

Question 10

What is SDN List?

Answer 10

A list of terrorist names that should be avoided (OFAC)

Question 11

KYC - know your customer

Answer 11

RR checks customer for appropriate “due diligence” questions and suspicious activity

Question 12

What info is needed for KYC?

Answer 12

personal info, investing histories, and financial info

Question 13

T/F: A supervisor must be notified of any missing info in KYC.

Answer 13

T

Question 14

AML - Anti money Laundering

Answer 14

program helps checking for suspicious activity

Question 15

Who do RR report to of any money laundering activity?

Answer 15

SAR with FinCen

Question 16

3 phases of anti money laundering

Answer 16

placement, layer, integration

Question 17

One prohibited act during the report to SAR of suspicious activity

Answer 17

RR notify suspicious party of them reporting party

Question 18

how many days are given to RR to report to SAR?

Answer 18

30 days

Question 19

CTR - Currency Transaction Reports

Answer 19

violation of cash transactions that are more than 10,000

Question 20

how many days should currency transactions be reports?

Answer 20

15 days

Question 21

structuring

Answer 21

a violation method used to avoid being reported by transacting cash in smaller series

Question 22

Reg SP

Answer 22

rule to protect customer privacy and notify them of a member’s firm practices/policies

Question 23

what does the Reg SP do?

Answer 23

firm shares customer info with 3rd party

Question 24

what option must be given to customers who want to avoid sharing their info with 3rd parties?

Answer 24

opting out

Question 25

T/F: Privacy statement must be given to customer under Reg SP

Answer 25

T

Question 26

Who does Reg SP concern?

Answer 26

customer / consumer

Question 27

difference of customer and consumer in Reg SP

Answer 27

consumer don't get annual report

Question 28

can firms open accounts for customers already opened with another firm?

Answer 28

yes

Question 29

what must be needed for firm to open account of customer of another firm?

Answer 29

written consent, written notice to executing member, duplicate statements

Question 30

Suitability

Answer 30

required of RR's to ensure best suited account to open for customers

Question 31

what happens when customer don't disclose financial info?

Answer 31

no recommendations will be given

Question 32

3 suitability levels RRs must do

Answer 32

reasonable, customer, quantitative

Question 33

Reasonable basis

Answer 33

see if product suit investor

Question 34

Customer basis

Answer 34

see if product meet their particular needs

Question 35

Quantitative

Answer 35

ensure a series of recommendations is suitable and not excessive

Question 36

What is Reg BI set by?

Answer 36

SEC

Question 37

who does Reg BI not apply to?

Answer 37

corporations

Question 38

who does Reg BI apply to?

Answer 38

natural person who is given recommendations and takes recommendations

Question 39

obligations of broker - dealers

Answer 39

disclose info, care for customer, avoid conflict, comply to rules