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Series 63 > Overview > Flashcards

Overview Flashcards

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Series 63 flashcards
1
Q

What is the primary purpose of the Securities Act of 1933?

A

Provide investors with full and fair disclosure regarding new issues (prospectus)

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2
Q

True or False: The SEC judges an offering’s investment merit and provides approval.

A

False

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3
Q

True or False: The Uniform Securities Act is exactly the same law in every state.

A

False. The USA is a model law, not the actual law of any state.

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4
Q

According to the USA, who is included under the term “person?” 6

A

Any legal entity, including

  1. individuals (clients/agents/IARs),
  2. BDs,
  3. IAs,
  4. issuers,
  5. corporations, and
  6. partnerships
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5
Q

True or False: In state law, individuals representing issuers in effecting securities trades are ALWAYS deemed agents.

A

False. Individuals are not deemed agents if representing issuers of exempt securities or effecting exempt transactions.

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6
Q

As it applies to a BD or IA, what does the term “exclusion” mean in the USA?

A

Exclusion signifies that a person does not meet the definition of a BD or IA in the state.

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7
Q

A securities firm that executes trades for its own account or the accounts of others is deemed a _______________.

A

A securities firm that executes trades for its own account or the accounts of others is deemed a broker-dealer (BD).

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8
Q

Who manages accounts, solicits services, or makes recommendations on behalf of a registered investment adviser?

A

An investment adviser representative (IAR)

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9
Q

An individual who represents an issuer in selling registered, non-exempt securities for compensation is an ________.

A

An individual who represents an issuer in selling registered, non-exempt securities for compensation is an agent.

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10
Q

An ___________________________________ is to an investment adviser what an ________ is to a BD.

A

An investment adviser representative (IAR) is to an investment adviser what an agent is to a BD.

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11
Q

Who is the official that monitors and administers a state’s securities laws?

A

The Administrator or Commissioner

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12
Q

The USA refers to an individual who represents a BD in the sale of securities as an ________.

A

The USA refers to an individual that represents a BD in the sale of securities as an agent.

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13
Q

Identify who is considered a person under the USA.

A

Business entities, issuers, estates, governments, individuals (e.g., clients, IARs and agents)

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14
Q

What is the general definition of an investment adviser?

A

A firm that provides advice/analyses regarding securities, as part of a business, and for compensation

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15
Q

Identify the acronym: USA

A

Uniform Securities Act

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16
Q

Identify the acronym: IA

A

Investment Adviser

17
Q

Identify the acronym: IAR

A

Investment Adviser Representative

18
Q

Identify the acronym: NSMIA

A

National Securities Markets Improvement Act

19
Q

Identify the acronym: NASAA

A

North American Securities Administrators Association

20
Q

What is the ABC Test for investment advisers?

A

The test that defines an IA as a firm that provides Advice as part of a Business for Compensation

21
Q

Identify the acronym: RIA

A

Registered Investment Adviser

22
Q

Who enforces the Uniform Securities Act?

A

The Administrator

23
Q

What is the general definition of an issuer?

A

Any person who issues or proposes to issue a security, such as government entities and corporations.

24
Q

An _______of an ________ is an individual who represents an issuer in effecting transactions with the general public.

A

An agent of an issuer is an individual who represents an issuer in effecting transactions with the general public.

25
Q

What’s an issuer transaction?

A

A transaction in which the issuer receives the proceeds.

26
Q

True or False: The U.S. Virgin Islands are a member of NASAA.

A

True

27
Q

True or False: Puerto Rico is a member of NASAA.

A

True

28
Q

Is an individual who represents an issuer in the sale of registered stock considered an agent?

A

Yes. An individual who represents an issuer of securities being offered publicly must register as an agent.

29
Q

True or False: States may make rules that are more restrictive than SEC (federal) rules.

A

False. NSMIA prohibits states from making laws that are more restrictive than existing federal requirements.

30
Q

List the entities that make up NASAA. 6

A
  1. All 50 U.S. states,
  2. the U.S. Virgin Islands,
  3. Puerto Rico,
  4. the District of Coloumbia,
  5. Canada and
  6. Mexico
31
Q

What are the three components that must be met for a firm to be defined as an IA?

A

1) Provide advice regarding securities,
2) Do so as a business
3) Receive specific compensation
(the ABC test)

32
Q

Identify who IS NOT considered a person under the USA. 4

A
  1. Minors,
  2. incompetents,
  3. securities, and
  4. the deceased
    are NOT considered persons.
33
Q

What is the three-pronged test for determining whether a firm meets the IA definition?

A

A-B-C. A = advice/analyses, B = business, C = compensation

34
Q

True or False: The District of Columbia is a member of NASAA.

A

True. Washington D.C. is a member of NASAA.

35
Q

NSMIA indicates that securities listed on the NYSE, NASDAQ and Toronto Exchange are _______ _______ securities.

A

NSMIA indicates that securities listed on the NYSE, NASDAQ and Toronto Exchange are federal covered securities.

36
Q

In state law, individuals who represent BDs in effecting securities transactions are referred to as ______.

A

In state law, individuals who represent BDs or issuers in effecting securities transactions are referred to as agents.

37
Q

Identify two significant creations that are credited to the National Securities Markets Improvement Act (NSMIA).

A

Federal Covered Advisers and Federal Covered Securities

38
Q

The _____ _________ _________ ______________ __________________ is an organization consisting of state Administrators.

A

The North American Securities Administrators Association (NASAA) is an organization consisting of state Administrators.

39
Q

The Securities Act of 1933 regulates ____________.

A

The Securities Act of 1933 regulates new issues.

Series 63 (7 decks)

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