Series 7: Unit 20 (Complaint Resolution) (Qbank)

A customer gives you a limit order to buy 500 shares of XYZ at 30. You erroneously buy 1,000 shares at 29. The customer is entitled to A) 500 shares at 29. B) 1,000 shares at 29. C) 500 shares at 30. D) 1,000 shares at 30. Explanation The customer is entitled to 500 shares at 29. A buy limit order may be executed at the limit price or better (lower). If the firm buys more shares than indicated on the order ticket, the customer cannot be held responsible.

A) 500 shares at 29. Explanation The customer is entitled to 500 shares at 29. A buy limit order may be executed at the limit price or better (lower). If the firm buys more shares than indicated on the order ticket, the customer cannot be held responsible.

A disclosure reporting page (DRP) must be completed on a person's Form U4 for all the following reasons except A) a period of homelessness. B) a civil suit resulting from an inheritance dispute. C) a bankruptcy. D) a tax lien.

A) a period of homelessness. Homelessness would be disclosed on a U4, but not subject to further scrutiny on a DRP.

Rulings under the Code of Arbitration Procedure A) are binding on all parties. B) may be appealed to the FINRA National Adjudicatory Council. C) are binding on members but not on customers. D) may be appealed to the SEC.

A) are binding on all parties. A customer or member who chooses to submit a claim or dispute to arbitration under the Code of Arbitration Procedure is bound by the arbitration decision, which is not subject to appeal by either party. Please note that decisions under the Code of Procedure (disciplinary actions) may be appealed.

A registered representative has just been disciplined under the Code of Procedure. Within how many days does Form U4 need to be updated? A) 60 B) 30 C) 10 D) 20

B) 30

An application for registration as a municipal securities registered representative must be accompanied by all of the following personal information except A) date of birth. B) bank references. C) residences over the past 5 years. D) employment record for the previous 10 years.

B) bank references.

An angry customer has written a letter of complaint and sent it to the registered representative handling the account. The first step the registered representative must take is to A) notify the firm's designated examining authority (DEA). B) forward the complaint to the proper supervisory person. C) accept responsibility for the problem and offer a refund to the customer. D) contact the customer and try to resolve the issue.

B) forward the complaint to the proper supervisory person.

A customer calls their registered representative to complain about the representative's performance. Under FINRA rules, the representative A) must file an amended Form U4. B) is not required to do anything. C) must immediately inform the principal. D) must file the complaint with FINRA.

B) is not required to do anything. Only written complaints must be filed with FINRA

If an individual fails a FINRA qualification exam three consecutive times, a fourth attempt may not be made for A) 60 days. B) 30 days. C) 90 days. D) 180 days.

D) 180 days.

Under the Code of Arbitration Procedure, arbitrators fall into one of two categories: public or nonpublic arbitrators. Which of the following persons could not be a public arbitrator? A) A retail investor who has filed a complaint against a broker-dealer in the last two years B) An attorney who has represented an investor in an arbitration case once in the past five years C) Private investors who have substantial mutual fund holdings D) Any person who worked in the financial industry for any portion of her career

D) Any person who worked in the financial industry for any portion of her career Those who have worked in the financial industry for any duration during their careers will always be classified as nonpublic arbitrators. Certain professionals, such as attorneys and accountants, can be considered nonpublic if at least 20% of their revenues comes from representing financial industry firms or any parties to an arbitration. One time in five years is certainly not going to be 20% of their revenues.