Series 63
What are some characteristics of a withdrawal?
- becomes effective after 30 days if there are no revocation or denial proceedings in the process. - Once registration has been withdrawn, the administrator still retains jurisdiction over you for 1 year.
In the event an agent transfers from one broker-dealer to another broker-dealer, who must report the transfer to the Administrator?
-BD A -BD B -agent
A state Administrator may require an applicant for registration to do what?
-Furnish information about any SEC adjudications within the past 10 years -Pay a registration fee -Pass a qualification examination -Place an advertisement in one or more newspapers circulated in the state
What does LATE stand for?
-Lawyers -Accountants -Teachers -Engineers can all provide investment advice without having to register as an investment adviser under the USA
Securities issued by an insurance company organized under the laws of any state and authorized to do business in that state are exempt from registration.
True
The administrator has authority to issue a cease and desist order without a hearing.
True
The issuer of a federal covered security may be required to pay fees to the states.
True
Transactions by fiduciaries such as a trustee in a bankruptcy reorganization or executor of an estate, sheriffs, are exempt from registration.
True
When conducting an investigation, the Administrator may gather evidence by issuing a subpoena to witnesses.
True
Which of the following is considered a sale of securities under the Uniform Securities Act?
-Redemption of mutual fund shares is always treated as a sale by the redeeming shareholder. -any disposition (liquidation) of securities that involves cash consideration, or in which the shareholder has a choice of cash or securities, is a sale.
federal covered security
-any security listed on a major stock exchange or the Nasdaq stock exchange -Municipal bonds, exempt securities under the Securities Act of 1933, are also federal covered securities with one significant exception: if the issuer is a political entity in this state and it is sold to a resident of this state, it is not considered a federal covered security in this state.
registrations by coordination
-applies to offerings being made in more than one state -SEC and state registration is necessary -SEC sets effective date
USA exempt securities
-issued by a bank or anything that resembles a bank (savings and loan, or credit union) -securities issued by a government unit are always exempt -exchange traded securities are known as federally covered and are exempt
An adviser with no place of business in the state is exempt from registration if...
-it offered their services to no more than 5 individuals during any consecutive 12 month period -it's clients were institutional investors (ie; investment companies, BDs, or other investment advisers)
When an Administrator issues a final order, an agent subject to the order may
-obtain a review of the order in an appropriate court of law -request that additional evidence be presented to the court
Under the Uniform Securities Act, an offer and sale does NOT exist if it is
-the result of a class vote by stockholders regarding a merger or consolidation -a bona fide pledge or loan -an act incident to a judicially approved reorganization in which a security is issued in exchange for one or more outstanding shares -a gift of nonassessable securities
registration statements for securities under USA are effective for...
1 year from the effective date
The Howey decision defined a security as
1) an investment of money (2) in a common enterprise (3) where there is an expectation of a profit (4) through the efforts of a third party and not the investor.
An interest in which of the following is a security under the Uniform Securities Act?
1. Merchandising marketing scheme 2. Multilevel distributorship arrangement 3. Oil and gas drilling program 4. Cattle feeding program
What are the 3 primary expenses involved with brokerage accounts that are not included in the fee disclosure template?
1. commissions; 2. markups and markdowns; and 3. advisory fees for those firms that are also registered as investment advisers.
If the Administrator has summarily suspended an investment adviser representative's registration, the registrant may request a hearing by written request and the hearing will be granted within
15 days
How long must customer correspondence be kept for?
3 years
When a broker-dealer's registration under the Uniform Securities Act is revoked, which of the following occur?
An agent's license is only effective as long as that agent is associated with a registered broker-dealer. In most cases, it would be said that the agent's registrations are placed in suspense. The agent's registrations are neither held in escrow until a hearing nor does the Administrator choose a broker-dealer to oversee activities of the agents until the broker-dealer's registration is reinstated.
In general, a BD will disclose it's fee schedule when?
At the time of the account opening.
The civil liabilities provisions of the Uniform Securities Act provide for a statute of limitations equal to
the sooner of 2 years from the date of discovery or 3 years from the date of the violation.
definition of a sale
Contract to dispose of a security
Are publishers of investment newspapers considered investment advisers?
No
Does a partner in a BD who has contributed most of the capital of the firm, but takes no part in the activities have to be registered?
No
Does the client's death negate a client's right to a civil suit for damages?
No
Under the Uniform Securities Act, Administrators of all of the following states have jurisdiction EXCEPT
the state from which payment for the purchase of securities was made
Criminal penalties may NOT be imposed in addition to any other penalties assessed or damages recovered under the act.
False
It is required that investment advisers disclose to the Administrator their methods used to select investments.
False
Participating whole life insurance that pays annual dividends is a security.
False
Securities issued by bank holding companies are exempt securities under the act.
False
Static and interactive content need approval
False
notice filing
Federal covered securities do not register with the state Administrator; however, they may be required to file records with the state Administrator that are filed with federal registration.
Does being in the industry qualify an investment adviser representative as an accredited investor?
No, they must meet the requirements
Who can issue injunctions?
Injunctions may be issued by a court of competent jurisdiction only.
You are authorized to lend to yourself or others any securities held by you in my margin account and to carry all securities lent as general loans, and you shall have no obligation to retain under your possession and control a like amount of such securities
Loan Consent agreement
Can an agent be registered with multiple BDs?
Multiple registrations are permitted if the BDs are affiliated by direct or indirect common control, or an exception is made by the Administrator. The agent must be registered with both BDs and file separate U-4s.
Is the Administrator allowed to establish time requirements in excess of the SEC?
NO
Are fees based on a share of capital gains or appreciation in an account allowed?
No, unless there is a specific exception.
Under the Uniform Securities Act, what remedy does a client have against a firm that has sold him an unregistered non-exempt security?
Request rescission
Which of the following statements regarding an agent's registration is CORRECT?
Revocation of the registration of that agent's broker-dealer will result in cancellation of that agent's effective registration.
Under the Uniform Securities Act, the Administrator may require a broker-dealer to post a surety bond of
The NSMIA states that the Administrator may not require a broker-dealer be bonded in an amount above that set by the SEC. Furthermore, bonds will not be required of broker-dealers that maintain a specified net capital.
What is the smallest order that can be placed for an institutional account?
There is no limit
A person may be registered as both a broker-dealer and an investment adviser at the same time.
True
An exempt security or transaction is exempt from the registration requirements and the requirements for filing of advertising and sales literature.
True
Industry rules require that investment advisers made disclosure in writing when acting as principals (from inventory) or agents in a transaction with an advisory client.
True
Interactive content can be reused by others and can be commented on by others.
True
Registration of a broker-dealer automatically constitutes registration of any agent who is a partner, officer, or director, or a person occupying a similar status or performing similar functions.
True
when must a consent to service of process be filed with the Administrator?
With the original application only
A solicitor is considered what under the USA?
an investment adviser representative
Agent
any individual other than a BD who represents a BD or issuer in effecting or attempting to effect purchases or sales of securities.
The administrator may require that a prospectus be sent or given out when?
before the sale of the security. according to section 305(1)
An individual must register as an agent when effecting transactions with an issuer's existing employees if ...
commissions are paid.
The agreement that the Administrator can receive subpoenas on behalf of a registered agent, BD, or investment advisers involved in any securities sale that violates the USA, is the...
consent to services of process.
Investment advisers who manage at least $100 million but less than $110 million may register with...
either the SEC or the state Administrator, not FINRA.
stock issued by an insurance company not offering policies in this state is exempt.
false
define offer
includes an attempt to dispose of securities for value, or a solicitation of an offer to buy a security. Gifts, whether legal or not, are not considered an offer.
An investment adviser representative is anyone
involved with an investment adviser, even if they just supervise and don't sell securities.
An administrator may only deny applications on the basis of...
law. They are not empowered to pass judgments on methods.
notice filing
merely the filing of certain documents enabling the the registrant to offer securities in that state.
primary transaction
new offering of an issuer sold to investors
When is state registration effective?
not effective until noon of the 30th day after an application is filed, even if the agent has passed the Series 63 exam.
Under USA who can be an agent?
only individuals
A federal covered investment adviser is a person
registered, or excluded from the definition of investment adviser, under the Investment Advisers Act of 1940
May an Administrator shorten or lengthen the withdraw period?
shorten
Advisers with less than $100 million of assets under management may not register with ...
the SEC, but must register at the state level.
The term accredited investor only applies to
the Securities Act of 1933 and isn't involved with the USA.
An issuer employs its officers and directors to sell newly issued shares of the company to the public. To comply with the USA, the officers and directors would have to be registered as agents of
the issuer
An agent isn't required to to register as an investment adviser representative as long as...
the only form of compensation they receive are commissions.
registration by qualification
the only method in which the administrator set s the effective date
What kind of annuities are securities?
variable. fixed annuities are NOT
According to the USA, who is responsible for providing that a securities issue is exempt from registration?
whoever is claiming the exemption. ex. issuer, selling stockholder, or the broker dealer
Are there any rules for LATE?
yes, if they are charging for financial advice.
Can a BD be considered a investment adviser?
yes, if they offer advice for a separate charge
