SIE PART 4

securities related but no possibility of compensation

-BD employer may approve or disapprove - member firm acknowledgement written notice -member firm may require specific conditions be met

Selling away ex:

-RR helps friend issue securities for bus under formation -RR helps an friend sell inherited stock certs w/o being customer of firm

principal resp for:

-accepting new accts -approving accts for margin/option trading -approving/reviewing comm -reviewing trading activity -hiring/training new reps -responding to written complaints

court injunctions prohibiting acting as the following:

-an investment advisor, underwriter, or a BD -in any capacity aligned with the securities or financial services industry

Form U-5 state way of leaving firm 5

-discharged (details) -permitted to resign (details) -deceased -voluntary - other (details)

Registered Representative

-engages in investment banking or securities business -associated with BD -licensed

activities permitted by non registered BD's

-general non investment questions -providing literature on request, setting appts

fingerprints required for:

-involved in sales or securities -those who handle cash or securities -clerical persons exempt -submitting to US Attorney general -receptionist BD duty

if contributions are made by: 3

-municipal firm -municipal firm professional (MFP) associated w/ firm -an political action commute (PAC) controlled by firm

Form U-4 incudes

-name, address, alias -5 yr residency history -10 yr employment -info on charges

Rules under MSRB Rule G-37

-negotiated underwritings in which a municipal issuer selects an underwriter and negotiates a deal -financial advisory work in which a municipal issuer selects an municipal firm to help it structure a new issue

written complaints, who addresses:

-notify acct rep, acct principal, branch manager, compliance dept Prinicipal need to address complaint

enter in private securities:

-provide prior written notice to employer -describe in detail proposed transaction -describe in detail proposed role in transaction -disclose whether she has or may receive compensation for transaction

outside bus activities

-provide written notice -employing member's permission is not a regulatory requirement if not security related

prohibits municipal firm from engaging in municipal securities bus for ____ yr if contributions are made

2

time limit before re-testing

2 yrs SIE 4yr

changes to U-4 form must be filed within

30 days in event with the CRD

Central Registration Depository (CRD)

A computerized information system that is maintained by FINRA to provide registration information regarding broker-dealers and registered representatives.

FINRA

Financial Industry Regulatory Authority -agree to compliance with federal securities laws

Which of the following positions will mitigate the risk of a short call position?

Long calls

$250 contribution are permitted by _____ eligible to vote for that official

MFP

who retrieves U-5?

New ee and FINRA CRD

Form U-4

Not effective unless pass exam -1st fail 30 days -3rd fail 6 mths

Gifts and Gratuities

Permitted if: -not conditional on sale -approved by employing member firm -100 max per indiv -does not apply to bus entertainment

Which of the following are required in discretionary accounts? A) SEC approval to open the account B) Prior approval by a principal before each discretionary trade is placed C) Prompt approval by a principal following each discretionary trade D) FINRA approval to open the account

Prompt approval by a principal following each discretionary trade

what require sponsorship:

SIE: no Top off exams and must be completed within 4 yrs of SIE

Primary market transactions would include which of the following? A) Sale of $10 million of municipal bonds by a broker-dealer acting as a market maker B) Sale of $10 million of U.S. Treasury bonds by a broker-dealer acting as a market maker C) Sale of $10 million of corporate stock by a broker-dealer acting as a market maker D) Sale of $10 million of corporate bond by a broker-dealer acting as an underwriter

Sale of $10 million of corporate bond by a broker-dealer acting as an underwriter underwriter: does not own market maker own: 1st mkt

Quote: 17 -17.25 6 x12 Customer can

Sell at $17 for 600 shares Buy at $17.25 1,200 shares

Which of the following transactions, if any, cannot be done in a cash account? A) Any of these could be done in a cash account B) Buy 100 ABC to close C) Buy 100 ABC to open D) Sell 100 ABC to open

Selling to open (a short sell) can only be done in a margin account. It cannot be done in a cash account.

Which of the following best describes how a buy stop at 39 would fill?

The next available price after the market price rises to 39

If the portfolio of a variable annuity separate account is directly and actively managed by the insurance company, the separate account must be registered as

an open-end management investment company.

firm element:

annual in-house

private securities transaction: (sailing away)

any sale of securities outside an associated person's regular business and his employing member

have to disclose _______ but does not disqualify you

bankruptcy

regulatory elements

content determined by FINRA -within 120 days of second registration anniversary -every 3 yrs -failure to complete deactivates registration until completed

An offering is defined as the sale of a security. Regarding offerings, all of the following are true except

corporate securities can only be offered in public securities offerings.

not on form

education or martial status

complaints filed to FINRA how often

end of each quarter held for 4 yrs

MFP:

engaged in securities underwriting, sales, financial advisory, research, investment advice or comm with public investors

Hostile takeover

goes directly to the target

A customer wishes to sell short 1,000 shares of ABC. Prior to executing the order, the registered representative must

locate shares that can be lent to effect the sale.

MSRB Rule G-37

municipal securities rulemaking board -prevent pay to play -enforced by FINRA

$250 _________ for contribution made by municipal firm

not

passive investment is ______ considered an outside bus activity

not (LP or investment company share)

written notice is need even if ____ _______

not paid

Gains gotten from the sale of securities is an example

of capital gains for tax purposes.

home office

premise visit by principal of firm and FINRA expect the office to be treated like branch

conduct rule

private securities transaction

Political Contributions

rules intended to preserve investor confidence and mkt integrity -contributions should never be used to procure bus

Not MFP if soley to ______ or _______ or ministerial functions

sale or clerical

ineligibility and disqualification:

statutory disqualification -sanctioned by the SEC, another SRO, or foreign equivalent of SRO -misstatements willfully made -felony -misdemeanor involving money or securities within past 10 yrs

Principal:

supervise reps and are resp for seeing that the member form's policies and all regs are followed

For each transaction, a customer must be sent or given a written confirmation of the trade at or before the completion of the transaction, the settlement date. Information on that trade confirmation would include: 2 things

the commission charged on an agency transaction. the Committee on Uniform Securities Identification Procedures (CUSIP) number (if any).

power to revoke registration at the state level lies with

the state administrator

If a preferred shareholder received a $3.50 annual dividend each year, it could be assumed that

this is a 3.5% preferred class. An annual dividend of $3.50 simply tells you that this is a 3.5% preferred class of stock (3.5% × par ($100) = $3.50) or ($3.50 ÷ par ($100) = 0.035). The current market value is not used to calculate the fixed dividend, nor does this dividend amount tell us what common shareholders received.

Form U-5

with CRD in 30 days or termination date