Pre tests 1-3 Flashcards
certificate for a municipal security is considered mutilated if any of the following conditions can’t be determined
maturity date
certificate number
seal of issuer
* coupon payment date does not constitute mutilation
dealer to dealer confirmations
yield cusip contra party name
Not customers name
Offerings of discount bonds must be accompanied by a legend informing customers that
informing customers that discount bonds are subject to tax on the difference between discount price and par, and that the discount yields shown are gross yields-to-maturity
According to the MSRB, a firm’s records may be retained electronically:
In addition to having the capability of reproducing physical copies of the electronic records, a firm must also maintain electronic duplicates (i.e., backup copies) in a separate location.
Under CIP requirements, a broker-dealer must verify a person’s identit
Within a reasonable period
The account records for a broker-dealer must reflect the following information for a retail custome
The customer’s name and residence or principal business address
Whether the customer is of legal age
A tax identification or Social Security number
The customer’s occupation
The name and address of the employer
Information that will be taken into consideration when making recommendations to the customer (i.e., financial background, tax status, and investment objectives)
The signature of the municipal securities representative who introduces the account to the firm and the signature of a municipal securities principal indicating acceptance of the account
Whether the customer is employed by another broker-dealer or municipal securities dealer
The customer’s signature, although usually obtained, is not required.
A copy of the MSRB manual must be available in all departments, EXCEPT:
Underwriting, trading or sales of municipal securities
Financial advisory or consultant services for issuers
Research or investment advice with respect to municipal securities
Any other activities which involve communication, directly or indirectly, with public investors in municipal securities
* clearance wouldn’t have it.
A broker’s broker is a broker-dealer that engages in transactions for the account of:
Another broker-dealer
The underwriter of securities that are used to partially refund an outstanding issue is required to:
Apply for a CUSIP number on the new issue and on any refunded portions of the old issue
censure and statutory denial
A censure doesn’t necessarily cause statuatory denial
how does an smmp confirm it’s ability to judge investments
It may affirmatively indicate in writing or orally that it is exercising independent judgment in evaluating the recommendations of the dealer
A syndicate manager is required to provide a summary statement showing which TWO pieces of information
The aggregate par value and prices of all securities sold by the syndicate
The identity of each person who submitted group orders that received an allocation
bearer bond
signature delivery
A bearer bond does not require an endorsement (a signature) by the owner, but a registered bond would require one. (78021)
A swaps advisor
Is a MAP
Mail Addressed to a rep
The firm shall not permit municipal securities representatives to open mail, even if it is addressed to them. The firm may insist that personal correspondence, not be received at their firm
opening account for employees
When opening an account for an employee of another municipal securities firm, the carrying firm must sent written notice of this fact prior to opening the account. This is true even if the employee is not an associated person
If a control relationship exists with the MA
can they bid on a syndicate offering
no
If a control relationship exists they can’t bid on negotiated or competitive.
correspondence retention
4 years
A customer purchases securities from a municipal securities dealer. Payment for the purchase is to be made by a bookkeeping entry, transferring money from another account of this customer. The completion of the transaction occurs:
When the bookkeeping entry is made by the dealer
are verbal grievances complaints
Under MSRB rules, only written grievances are considered complaints
Advisory Relationship Agreement
Every financial advisory relationship must have a written agreement between the issuer and the dealer providing financial advisory services. The agreement must contain the compensation arrangement including provisions relating to the deposit of funds.
529 plan rules OS
529 plans are considered primary offerings and an os must be delivered no later then settlement.
A municipal securities salesperson who also trades for her own account must be registered as
“associated person.”
The legal opinion for a municipal bond states
The bonds may be legally issued
Interest is exempt from federal income taxes
The bonds were properly advertised and awarded
