Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

SIE Exam Prep > Overview of Regulatory Framework > Flashcards

Overview of Regulatory Framework Flashcards

1
Q

When a registered representative (RR) has an interest in an account at another firm, what must the firm do before conducting any transactions?

A. Notify the RR’s employed by phone

B. Deliver duplicate documents for the account

C. Notify the Securities and Exchange Commission (SEC)

D. Make a note in the RR’s file

A

B

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Which of the following is NOT true regarding customer complaints?

A. Complaints cannot be resolved using mediation.

B. Complaints must be submitted in writing.

C. Complaints can be solved using a formal or informal process.

D. Complaints are submitted to the Financial Industry Regulatory Authority (FINRA).

A

A

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Which of the following forms is used to terminate the registration of representatives with a specific self-regulatory organization or jurisdiction?

A. Form U4

B. EMMA

C. Form U5

D. TRACE

A

C

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Which of the following is true of continuing education for registered persons?

A. There are three elements: regulatory, firm, and personal.

B. Organizations that employ registered persons must evaluate members’ registered persons and evaluate members’ securities knowledge biannually.

C. Organizations must document their written plan and its implementation.

D. FINRA details specific points that must be covered in the training plan.

A

C

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Who has first jurisdiction over a complaint filed using formal proceedings?

A. District Business Conduct Committee (DBCC)

B. Supreme Court

C. FINRA Board of Governors

D. Securities and Exchange Commission (SEC)

A

A

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Which of the following is true about political donations by FINRA member firms?

A. Payment to political source must be disclosed to FINRA.

B. Payments to local government do not count towards the donation limit.

C. Political contributions cannot exceed $250 per person.

D. Payments to political sources must be documented.

A

D

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Regulated entities cannot receive more than how much money per person per year if the compensation is related to municipal securities?

A. $100

B. $50

C. $200

D. $150

A

A

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

According to Article XV of the FINRA by laws. which action should a committee member take in cases of conflicts of interest?

A. Recuse themself of involvement and responsibility over the matter.

B. Seen approval from the board or committee before proceeding.

C. Report the conflict to the Chief Executive Officer.

D. Attempt to personally reassign responsibility to another member.

A

A

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Which of the following is NOT required in FINRA Rule 4530 - Reporting Requirements?

A. Quarterly summary reports of investor complaints made in writing.

B. Compensation for each registered representative.

C. Immediate reports (within 30 days after the firm could have been expected to know) of specified significant events.

D. Copy of certain criminal and civil actions.

A

B

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Which is a correct statement about Form U4 or Form U5?

A. Firms typically submit Form U4 information on paper through the mail or by fax.

B. Form U5 is used by a firm to end a person’s registration with self-regulatory organizations.

C. Form U5 information is available through the BrokerCheck website, https://brokercheck.finra.org/

D. Firms typically submit U5 information on paper forms through the mail or by fax.

A

B

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Which is the correct statement about guidelines under MSRB Rule G-20 - Gifts, Gratuities, and Non-cash Compensation for non-cash compensation for representatives who sell municipal securities?

A. Gifts up to $500 are allowed if not linked to sales.

B. Promotional items of nominal value displaying the issuing entity’s information are allowed.

C. Meals and entertainment tickets aren’t allowed.

D. Gifts up to $100 for births or weddings are allowed.

A

B

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

In which of the following FINRA By-Laws Articles are member broker-dealer firms required to make annual payments and other payments as determined?

A. FINRA By-Laws Article I - Definitions

B. FINRA By-Laws Article III - Qualifications of Members and Associated Persons

C. FINRA By-Laws Article IV - Membership

D. FINRA By-Laws Article V - Registered Representatives and Associate Persons

A

C

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Which of the following is NOT listed in FINRA Rule 1220 Registration Categories?

A. Research principal

B. General securities representative

C. Securities administrative assistant

D. General securities principal

A

C

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

According to FINRA Rule 2267, which of the following items of information is a member NOT required to provide to each customer oncer per year?

A. The FINRA BrokerCheck hotline phone number

B. The FINRA website address

C. The contact information of the customer’s corresponding member

D. A statement that informs the customer that an investor brochure is available to them.

A

C

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

Under FINRA Rule 8312 - FINRA’s BrokerCheck Disclosure, what is FINRA NOT required to disclose?

A. Data from the most recently submitted registration forms.

B. Summary data regarding some arbitration awards against a member firm related to a dispute with a public customer.

C. Comments provided by the person who is a subject of the data.

D. Dates of qualification exams failed.

A

D

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

Which statement about FINRA and the MSRB is correct?

A. FINRA Rule 0100 Series states that FINRA will work with the MSRB to supervise municipal advisors.

B. FINRA Rule 1122 specifies the manner in which to provide misleading information to FINRA.

C. MSRB Rule G-2 provides for non-registered persons to handle municipal securities transactions under qualified supervision.

D. MSRB Rule G-3 establishes requirements for qualifications testing, but not continuing education.

A

A

17
Q

Which statement about FINRA By-Laws Article XII - Disciplinary Proceeding is correct?

A. The specific violation must be stated.

B. No provision is given for the person who is the subject of the process to speak or to have someone, such as an attorney, speak to the accusation.

C. No record is kept on the disciplinary process.

D. Any decision made is not necessarily announced.

A

A

18
Q

According to FINRA Rule 2267 - Investor Education and Protection, which information is NOT required to be provided to each customer annually?

A. FINRA BrokerCheck Hotline Number

B. FINRA website address

C. Notice of the opportunity to obtain a document that describes FINRA BrokerCheck

D. Continuing education scores of the customer’s representative.

A

D

19
Q

According to MSRB Rule G-20, what is the yearly value limit to the amount that regulated entities and their associates may give to any non-member or non-employee if they interact with that non-member or non-employee in an official capacity?

A. $50

B. $100

C. $200

D. $500

A

B

20
Q

In the context of municipal securities, what is the main purpose of regulating gifts and gratuities provided to registered entities?

A. To deter tax evasion by regulated entities.

B. To guarantee fair distribution of gifts and gratuities among regulated entities.

C. To uphold ethical practices and prevent conflict of interest within the financial sector.

D. To motivate regulated entities to explore alternative revenue shares.

A

C

21
Q

Which of the following is a Registered Representative (RR) required to do if they have an interest in an account at another firm?

A. Notify the other firm’s employer in writing.

B. Notify their own employer in writing.

C. Disclose the account to the Securities and Exchange Commission.

D. Obtain permission from both firms before conducting any transactions.

A

B

22
Q

Which of the following is the primary purpose of state-level blue sky laws in regulating the securities industry?

A. To override federal securities regulations.

B. To provide additional protection to state residents beyond federal regulations.

C. To remove state-level barriers to securities trading.

D. To allow states to regulate the global securities market.

A

B

23
Q

Which of the following is true of Private Securities Transactions?

A. They occur when the broker sells a security recognized or sold by their own broker-dealer.

B. They do not require the broker to receive compensation for transaction.

C. They only occur when the broker buys a security for their own personal account.

D. They occur when the broker sells a security that is not recognized or sold by the broker-dealer.

A

D

24
Q

Which of the following is the limit on undisclosed political contribution per person or per political party per year according to the Municipal Securities Rulemaking Board Rule G-37?

A. Contributions less than $100

B. Contributions less than $250

C. Contributions less than $500

D. Contributions less than $1,000

A

B

25
Q

Which of the following is the purpose of the Municipal Securities Rulemaking Board Rule G-37?

A. Registered Representatives don’t need to disclose business that conflicts with their broker’s interests.

B. Outside business activities only include personal investment accounts held by an RR at other firms.

C. Firms must inform the RR’s employer in writing when the RR has an interest in another firm’s activities.

D. To require FINRA member firm’s to disclose all past credit events.

A

C

26
Q

Which of the following entities is NOT considered a self-regulatory organization (SRO) in the securities industry?

A. Financial industry Regulatory Authority (FINRA)

B. New York Stock Exhange (NYSE)

C. National Association of Securities Dealers (NASD)

D. Federal Reserve System (FRS)

A

D

27
Q

Which of the following is a Private Securities Transaction?

A. When the broker sells a security that is not recognized or sold by their own broker-dealer, or they receive compensation for the transaction.

B. When FINRA member firms solicit political donations from their employees or investors.

C. When regulated entities receive more than $100 per person per year as compensation.

D. When the securities industry takes a harder stance towards the credit histories of individual traders.

A

A

28
Q

Which of the following happens to a proposed or existing SRO if it is in conflict with a statute?

A. It is immediately approved as an SRO.

B. It is rejected as an SRO.

C. It is required to undergo a background check and fingerprinting.

D. It may still be approved as an SRO despite being in conflict with a statute.

A

B

29
Q

Which of the following is the primary role of the North American Securities Administration Association (NASAA) with respect to state-level securities regulation?

A. Enforcing states securities laws.

B. Drafting model securities acts for states to adopt or revise.

C. Licensing securities professionals at the state level.

D. Overseeing the registration or securities offerings in each state.

A

B

30
Q

Which of the following would NOT be considered outside business activities for a Registered Representative (RR)?

A. Activities that harm the RR’s own employer.

B. Personal investment accounts that the RR holds outside of their own firm.

C. Transactions that are not recognized or sold by the RR’s own broker-dealer.

D. All of the above.

A

B

31
Q

Which of the following reasons could result in the denial on postponement of an application to become an SRO?

A. Excessive interference from the government.

B. Financial insufficiency, criminal records, or a lack of a valid objective.

C. Noncompliance with state or federal securities regulations.

D. An excessively detailed application.

A

B

32
Q

Which of the following is true of Political Contributions by FINRA member firms?

A. They are prohibited at all times.

B. They are only prohibited during federal elections.

C. They are allowed as long as they are disclosed to the firm’s board or senior executive team.

D. They are allowed as long as they do not exceed $250 per person or per political party per year.

A

A

33
Q

According to the Financial Industry Regulatory Authority (FINRA) regulations, which of the elements is required to be included in options trade confirmations?

A. The broker’s personal preferences.

B. The expiration date at the options contract.

C. The customer’s personal details unrelated to the transaction.

D. The firm’s preferred stock.

A

B

34
Q

As a securities industry professional which of the following situations is considered a reportable event that must be disclosed to regulators?

A. Being issued a speeding ticket.

B. Volunteering at a charity event.

C. Filing a personal bankruptcy.

D. Attending an industry conference.

A

C

35
Q

When an investment advisor needs to terminate the registration of a representative with a specific self-regulatory organizations, which form should be used?

A. Form U2: Uniform Termination Notice

B. Form U5: Uniform Termination Notice for Securities Industry Registration.

C. Form U6: Uniform Disciplinary Action Reporting Form.

D. Form U8: Registration Termination Request.

A

B

36
Q

When a client has a dispute with an investment advisor, which type of complaint must be submitted to FINRA for resolution?

A. Verbal Complaint

B. Electronic Complaint

C. Formal Written Complaint

D. Informal Test Message Complaint

A

C

SIE Exam Prep (4 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions