Regulations: FINRA Rules

FINRA enforces regulations in which of the following markets?
I. first market
II. second market
III. third market
IV. fourth market

All of them

To take a second job, under FINRA rules, a registered rep must obtain prior written approval from (the):
a. FINRA
b. SEC
c. branch manager
d. financial and operations principal

branch manager

Under FINRA rules, a registered rep:
a. may borrow money from a customer only with permission of FINRA
b. may borrow money from a customer only with permission of the branch manager
c. may borrow money from a customer only with permission of the customer

may not borrow money from a customer

A registered rep takes a customer out to dinner and a show, spending $180. This activity is:
a. a violation of FINRA rules
b. permitted because less than $100 was spent on a per-person basis
c. permitted if it complies with the firm's policies and procedu

permitted if it complies with the firm's policies and procedures

A registered rep has written a research report about oil stocks that he wishes to mail to customers. Which statement is TRUE?
a. the report must be approved by the SEC
b. the report must be approved by a supervisory analyst
c. the report must be approved

the report must be approved by a supervisory analyst

Arbitration is preferred over litigation as a means for settling disputes because:
a. it is less time consuming and less expensive
b. it allows the parties involved to get a hearing of their grievances
c. the decision cannot be appealed
d. the arbitration

it is less time consuming and less expensive

Notification to FINRA is required for all of the following EXCEPT:
a. a written customer complaint is received about a registered employee misappropriating customer funds
b. a registered representative is arrested for assault and battery
c. a registered r

a registered rep is committed to a mental institution

If a brokerage firm receives a written customer complaint, then:
a. the complaint must be forwarded to the firm's self regulatory organization (SRO) for resolution
b. the firm must resolve the complaint and keep a separate file of the complaints, with act

the firm must resolve the complaint and keep a separate file of the complaints, with action taken, for inspection by the SRO

The FINRA 5% policy requires that consideration be given to all of the following when determining mark-ups and commissions EXCEPT:
a. financial condition of customer
b. dollar amount of the transaction
c. level of service provided by the firm
d. type of s

financial condition of customer

FINRA's 5% policy applies to which of the following?
a. sales charges on mutual fund offering
b. mark-ups charged on principal transactions of municipal bonds
c. underwritings spreads charged on new issue offerings effected over-the-counter
d. commissions

commissions charged on transactions effected over-the-counter

An order ticket is filled out and sent to the NYSE floor for execution. After being executed on the floor, it is discovered that the account number is incorrect. Under FINRA rules, the account number may be changed to the correct one by the:
a. registered

branch office manager

Under FINRA rules, copies of order tickets must be kept for:
a. 6 months
b. 2 years
c. 3 years
d. 5 years

3 years
d. 5 years

Which statements are TRUE about the use of the FINRA name on a member firm's or associated person's website?
I. the FINRA name can be shown
II. the FINRA name must be shown
III. if the FINRA name is shown, it must be hyperlinked to the FINRA website
IV. I

the FINRA name can be shown
if the FINRA name is shown, it must be hyperlinked to the FINRA website

All of the following time stamps are on an order ticket EXCEPT the time of order:
a. entry
b. execution, if executed
c. cancellation, if cancelled
d. confirmation

confirmation

Customers may be charged for all of the following services EXCEPT:
a. collection of dividends on street name stock
b. safekeeping of securities
c. mailing of proxies on street name stock
d. collection of interest on bonds held in safekeeping

mailing of proxies on street name stock

In a secondary offering, a member who acted as manager or co-manager CANNOT issue a research report on that company within how many days following the effective date?
a. 3 calendar days
b. 5 calendar days
c. 10 calendar days
d. 25 calendar days

3 calendar days

If a member firm acts as the managing underwriter in an initial public offering of an issue's securities, then the member is prohibited from issuing a research report on that company for:
a. 3 days following the effective date
b. 5 days following the effe

10 days following the effective date

A registered rep would like to increase his production by working from home at nights and on weekends. As part of this effort, the rep wants to use his home e-mail account to send his customers information and recommendations. This action is:
a. permitted

not permitted because the member firm has no way of auditing the rep's personal email account

A registered rep at a FINRA member firm is giving a talk about investing attended by 13 customers and 4 prospects. The speech includes recommendations of specific securities. Which statement is TRUE?
a. the speech can be given without prior approval
b. th

the speech content must be approved by the supervisory analyst

Specific compliance approval is needed for a registered rep to send out all of the following to 40 retail customers EXCEPT:
a. 3rd party research report on a stock not followed by the firm obtained by the rep
b. photocopy of a newspaper article about good

existing research report prepared by that firm

All of the following gifts given by a mutual fund sponsor to a registered rep violate FINRA rules EXCEPT:
a. a discount from the public offering price that is not included in the fund prospectus
b. wholesale overrides on fund sales
c. $50 per person per y

$50 per person per year

Which statements are TRUE?
I. a registered rep is permitted to buy a new issue directly from the underwriter
II. a registered rep is prohibited from buying a new issue directly from the underwriters
III. a registered rep is permitted to buy a new issue on

a registered rep is prohibited from buying a new issue directly from the underwriters
a registered rep is permitted to buy a new issue once it starts trading in the secondary market

Which of the following practices are prohibited under FINRA rules?
I. trading mutual fund shares
II. selling dividends
III. making blanket recommendations of low price speculative stocks
IV. recommending purchases beyond a customer's financial capacity

All of them

All of the following are violations of FINRA rules EXCEPT:
a refusal to trade at a stated quote unless the quote has been identified as nominal
b. selling mutual fund shares to customers in quantities just below breakpoint levels
c. pledging fully paid cu

exchanging customer margin securities with other collateral to secure a debt balance

Which of the following are violations of FINRA rules?
I. sharing in the profits and losses of a customer's account without contributing proportional capital
II. selling exempted securities to a customer with a written agreement to buy back the securities

sharing in the profits and losses of a customer's account without contributing proportional capital
orally guaranteeing to buy back customer securities at a preset price

Which of the following gifts is the maximum permitted under FINRA rules?
a. one gift of $100 value per person per year
b. unlimited number of gifts of $100 value per person per year
c. one gift of $200 value per person
d. unlimited number of gifts of $200

one gift of $100 value per person per year

Fidelity bonds are maintained by brokerage firms to:
a. protect against loss due to employee theft
b. protect against loss against falling markets
c. insure against causality losses
d. meet minimum net capital standards

protect against loss due to employee theft

A customer calls a registered rep to sell 500 shares of an over-the-counter stock and tells the rep that he wants the trade done privately - not in the public market. This is:
a. allowed without restriction
b. allowed with the oral approval of the princip

not allowed

All of the following are prohibited practices under FINRA rules EXCEPT:
a. backing away
b. interpositioning
c. free riding
d. arbitrage trading

arbitrage trading

A registered rep reads in that morning's newspaper that "Asian securities markets appear to have finally bottomed out." Based on this information, the registered rep calls each of her customers and says "Now is the time to buy Asian Fund." This action by

is a prohibited practice, since a suitability determination was not made for each client

If an analyst makes a public appearance, under Regulation AC, the analyst MUST:
a. make a verbal certification to the group being addressed
b. distribute a written certification to each person in the group addressed
c. give a blanket certification to all

give a blanket certification to all appearances made each quarter

A golf pro at the country club where a registered rep is a member wants to refer prospective clients to the rep in exchange for a small fee. Which statement is TRUE?
a. this is permitted since the referral payment is small
b. this is permitted if the rep

this is prohibited

A widely-followed research analyst is going to issue a 'buy' recommendation on a company. Prior to the release of the recommendation, the analyst and immediate family can:
a. buy the stock without restriction
b. buy the stock only if the purchase conforms

not buy the stock

A website maintained by a member firm that is not password protected is considered to be:
a. advertising
b. sales literature
c. public form
d. correspondence

advertising

A decision is reached by the District Hearing Panel under the Code of Procedure. Which statement is TRUE?
a. the decision is binding and non-appealable
b. an appeal may be filed with the national adjudicatory council
c. an appeal may be filed with SEC
d.

an appeal may be filed with the national adjudicatory council

The enforcement authorities for the U.S. securities markets and market participants include:
I. FINRA
II. SEC
III. MSRB

FINRA
SEC
Both FINRA and the Securities and Exchange Commission (SEC) regulate, and have enforcement capability over, the U.S. securities markets and market participants. The Municipal Securities Rulemaking Board creates rules for municipal market partici

Registered representatives may be compensated based on which of the following?
I. Trading commissions paid by the brokerage firm to the representative
II. Trading commissions paid by the customer to the representative
III. Salary paid by the brokerage fir

Trading commissions paid by the brokerage firm to the representative
Salary paid by the brokerage firm to the representative
Compensation cannot be paid by the customer to the registered representative. Only the broker-dealer may pay compensation to the r

Under FINRA rules, the maximum permitted annual gift from a registered representative to another person in the securities business or financial information media is:
A. $0
B. $50
C. $100
D. $250

$100
Under FINRA rules, the maximum permitted gift that can be given to another person in the securities business or the financial news media is $100 per person per year.

The Firm Element component of the "Continuing Education" requirement:
I. is administered by the compliance department
II. must be completed by all registered persons
III. must be completed annually
IV. must communicate information that is understood by th

All of them
The Firm Element of the Continuing Education requirement obligates member firms to deliver annual training to all registered representatives on product, regulation, and compliance issues. The firm must maintain a record that shows that the par

The Regulatory Element component of the "Continuing Education" requirement must be completed:
I. on the registrant's 1st anniversary of registration
II. on the registrant's 2nd anniversary of registration
III. every 2 years after the initial review
IV. ev

on the registrant's 2nd anniversary of registration
every 3 years after the initial review
The Regulatory Element of the Continuing Education requirement must be completed by registered persons on their 2nd anniversary of registration and every 3rd year t

If a registered representative fails to complete the Regulatory Element of the Continuing Education requirement within the stated time period, that person:
A. can continue to perform all of the functions of a registered representative
B. can only accept u

must cease performing all of the functions of a registered representative
If a registered representative fails to complete the Regulatory Element of the Continuing Education requirement within 120 days of the notification date, that person's registration

Which of the following statements are TRUE regarding a registered individual who recently left the employment of a FINRA member firm?
I. The individual is allowed to maintain his license at another member firm without being employed by that firm
II. The i

The individual cannot maintain his license at another member firm without being employed by that firm
The license lapses if the individual remains unaffiliated for 2 years
FINRA prohibits "parking" of licenses when an individual is not affiliated with a m

Which of the following activities can be performed by an assistant representative at a FINRA member firm?
I. Take new account information
II. Make a cold call
III. Accept an unsolicited order
IV. Open a new account

Take new account information
Accept an unsolicited order
An Assistant Representative - Order Processor is an individual that has a Series 11 license. This person can only accept unsolicited customer orders. He or she cannot solicit customers. This person

Notification to FINRA is required for which of the following events?
I. A registered representative is arrested for embezzlement
II. A registered representative is indicted under the Securities Exchange Act of 1934 for "insider" trading violations
III. A

All of them

A registered representative is employed by a broker-dealer that is a subsidiary of a publicly traded company, listed on the New York Stock Exchange. Which statements are TRUE?
I. The registered representative may recommend the purchase of the parent compa

The registered representative cannot recommend the purchase of the parent company's common stock
The registered representative may accept unsolicited orders for the parent company's common stock

Which of the following decisions by a registered representative require specific customer authorization?
I. Determining price and time of execution in a cash account
II. Determining price and time of execution in a margin account
III. Determining price an

Determining price and the number of shares traded in a cash account
Determining price and the number of shares traded in a margin account

A customer instructs a registered representative to "Buy 500 shares of ADP whenever you think the price is right." Which of the following statements are true about this order?
I. The order is the same as a not held order
II. The order is the same as a lim

The order is the same as a not held order
The order can be accepted without a prior written discretionary power of attorney from the customer
This order states the number of shares to be bought and the security to be purchased. The registered representati

Under FINRA rules, which of the following accounts would be considered to be "discretionary"?
A. An omnibus account run by an investment adviser for his clients
B. An account where a third party power of attorney has been given by the customer to another

An account where the broker has the power to decide when and what to trade without specific customer authorization
A discretionary account is one where the broker has the power to decide what and how much to trade. The customer gives a written power of at

Which statement is TRUE?
A. A registered representative can sign the name of a customer on an arbitration agreement
B. A registered representative can sign the name of a customer on a margin agreement
C. A customer can sign her name on a trading authoriza

A customer can sign her name on a trading authorization, allowing a registered representative to trade her account
A customer's signature cannot be forged, even if the customer were to give permission to do so. Legally, the customer's signature is require

The FINRA 5% Policy requires that consideration be given to which of the following when determining mark-ups and commissions?
I. Level of service provided by the firm
II. Type of security involved in the transaction
III. Financial condition of customer
IV

Level of service provided by the firm
Type of security involved in the transaction
Dollar amount of the transaction
A customer's ability to pay has no bearing on the amount of commission or mark-up that is charged. The dollar amount of the transaction, le

Which of the following statements are TRUE regarding a customer's securities held in a margin account at a brokerage firm?
I. The brokerage firm can charge for safekeeping the securities
II. The brokerage firm cannot charge for safekeeping the securities

The brokerage firm can charge for safekeeping the securities
The brokerage firm can charge for collecting dividends and interest on the securities
Brokerage firms can charge for clerical services such as safekeeping of securities. Since margin securities

Which of the following are violations of FINRA rules?
I. Recommending the purchase of put options to protect a stock position from a downwards market move
II. Sharing in the profits and losses of a customer's account
III. Selling exempted securities to a

Sharing in the profits and losses of a customer's account
Orally guaranteeing to buy back customer securities at a preset price
A registered representative cannot guarantee a customer's account against loss nor share in the account unless he or she opens

A brokerage firm is permitted to hold fully paid customer securities if the:
A. customer gives a full power of attorney to the brokerage firm and signs a rehypothecation agreement
B. brokerage firm segregates those positions from margin securities and pla

brokerage firm segregates those positions from margin securities and places them in safekeeping
Brokerage firms can hold fully paid customer securities as long as the positions are segregated from other margin securities and are kept in safekeeping.

A customer has marginable securities held in account that has a debit balance at the brokerage firm. Which statements are TRUE?
I. The securities must be segregated and placed in safekeeping
II. The securities can be commingled with those of other margin

The securities can be commingled with those of other margin customers
The securities may be rehypothecated to a bank for a loan by the broker
Fully paid customer securities must be segregated by the brokerage firm and placed in safekeeping. Such fully pai

A registered representative employed by ABC broker/dealer is good friends with an independent venture capitalist. The venture capitalist asks the registered representative to obtain investors for a private placement that he is forming. Which statement is

The registered representative can direct customers to the private placement only with the prior written approval of his employer

A customer wishes to open an account that will be used primarily to buy initial public offerings (IPOs). Which statement is TRUE regarding the proper procedure for prequalifying the account?
A. The customer must sign a representation letter that he or she

The customer must sign a representation letter that he or she is not restricted from buying IPOs
In order for a customer to buy IPOs (Initial Public Offerings) of common stock, the customer must sign a representation letter that he or she is not restricte

FINRA's IPO purchase restrictions that prohibit industry personnel from buying new issues in the primary market apply to:
I. Common stock offerings
II. Preferred stock offerings
III. Non-convertible bond offerings
IV. Convertible bond offerings

Common stock offerings
The FINRA rule restricting member firms and their employees from buying IPOs from underwriters only applies to equity offerings. This is the case because the pricing of equity issues has a large "expectations" component that is diff

Which statements are TRUE regarding the purchase of a new issue directly from the underwriter by industry personnel?
I. Purchase of IPOs directly from the underwriter that open for trading in the secondary market at a discount price is permitted
II. Purch

Purchase of IPOs directly from the underwriter that open for trading in the secondary market at a discount price is prohibited
Purchase of IPOs directly from the underwriter that open for trading in the secondary market at a premium price is prohibited

Which statements are TRUE?
I. A registered representative is permitted to buy a new issue directly from the underwriter(s)
II. A registered representative is prohibited from buying a new issue directly from the underwriter(s)
III. A registered representat

A registered representative is prohibited from buying a new issue directly from the underwriter(s)
A registered representative is permitted to buy a new issue once it starts trading in the secondary market

Under FINRA Rule 5130, which of the following are prohibited from buying a new issue directly from an underwriter?
I. A FINRA registered representative
II. A person who is financially dependent on a FINRA registered representative
III. A financially indep

All of them

A registered representative is a 5% participant in an investment club formed by members of the local Elks Club. The Elks Club investment club has opened a securities account at ABC Brokerage. The account wishes to buy an IPO being offered by an underwrite

The account can buy the issue without restriction
Registered representatives are prohibited from buying new issues from underwriters. This is true for any account in which registered representatives or other restricted persons have a greater than 10% part

Which statements are TRUE regarding FINRA Rule 5130 that restricts equity IPO purchases?
I. An investment club is permitted to buy an equity IPO directly from an underwriter
II. An investment club is prohibited from buying an equity IPO directly from an u

An investment club is permitted to buy an equity IPO directly from an underwriter
An investment club that has registered representatives as owners is permitted to buy an equity IPO directly from an underwriter if their total ownership is 10% or less

A registered representative of a member firm markets private placements to wealthy accredited investors. Before the member firm can market these private placement securities, it MUST:
A. conduct a reasonable investigation concerning the security and the i

conduct a reasonable investigation concerning the security and the issuer's representations about it

All of the following are prohibited practices under FINRA rules EXCEPT:
A. selling enough mutual funds to a customer to obtain a breakpoint
B. backing away from a quote
C. interpositioning another firm between a customer and market maker
D. withholding ne

selling enough mutual funds to a customer to obtain a breakpoint
Selling enough of a mutual fund to a customer that would qualify for a breakpoint in the sales charge is not prohibited - this is desired. It allows a customer to get a reduced sales charge

Which of the following would constitute violations of the FINRA Conduct Rules?
I. Opening a cash account for a customer without obtaining that customer's signature
II. Offering to trade mutual fund shares for a customer
III. Recommending to a customer tha

Offering to trade mutual fund shares for a customer
Recommending to a customer that he should get a group of friends together to buy mutual fund shares at a breakpoint

Which of the following are violations of FINRA's Conduct Rules?
I. Selling a customer an exempt security with a written agreement to buy back that security at a fixed price
II. Guaranteeing a customer account against loss
III. Making blanket recommendatio

Guaranteeing a customer account against loss
Making blanket recommendations of low price speculative stocks to customers
Selling dividends to customers by inducing customers to buy stocks just prior to the ex date

A communication sent to fewer than 25 existing or prospective retail clients is defined as (a):
A. Correspondence
B. Retail Communication
C. Public Appearance
D. Advertising

Correspondence

Which of the following is NOT defined as correspondence?
A. E-mail distributed to 15 existing retail customers
B. Seminar text for a speech that will be delivered to 30 prospective retail clients
C. E-mail sent to 10 prospective retail clients
D. Prospect

Seminar text for a speech that will be delivered to 30 prospective retail clients

All of the following would be considered to be a "retail communication" EXCEPT a(n):
A. direct mailing sent to 30 existing retail clients
B. password-protected website maintained by a broker-dealer
C. institutional communication
D. internet bulletin board

institutional communication

Which of the following would be considered to be a "retail communication"?
A. Direct mailing sent to 15 existing retail clients
B. Password-protected website maintained by a broker-dealer
C. Institutional communication
D. Correspondence to an individual c

Password-protected website maintained by a broker-dealer

A representative gives a seminar to investors, making a presentation about successful hedge fund strategies. It is attended by 30 retail clients and 20 institutional clients. FINRA defines this as:
A. an advertisement
B. a solicitation
C. a retail communi

a retail communication

All of the following are defined as "institutional clients" for purposes of the FINRA communications rules EXCEPT:
A. bank
B. investment company
C. insurance company
D. real estate company

real estate company

Websites established by brokerage firms are considered to be:
A. advertising
B. sales literature
C. correspondence
D. educational material

advertising

Which of the following is defined as sales literature?
A. E-mail distributed to 15 existing retail customers
B. Seminar text for a speech that will be delivered to 30 prospective retail clients
C. E-mail sent to 10 prospective retail clients
D. Prospectin

Seminar text for a speech that will be delivered to 30 prospective retail clients

A newly hired registered representative finds a standard form letter on the firm's intranet and wants to send it to 20 of his friends. Which statements are TRUE?
I. The letter must be filed with FINRA prior to use
II. The letter must be used without chang

The letter must be used without change
The letter must be maintained on file by the firm for at least 3 years after use

A registered representative wishes to give a speech to a group of 35 potential retail clients. The speech is scripted and explains the differences between investing in growth versus value stocks. All of the following statements are true about giving the s

a copy of the speech must be pre-filed with FINRA

Which of the following statements are TRUE regarding electronic communications sent by registered representatives at member firms that have a communications compliance program in place?
I. Registered representatives must be trained by the firm about what

Registered representatives must be trained by the firm about what content is permitted in such communications
Registered representative communications must be supervised and reviewed by the member firm
Registered representative communications may only be

All of the following statements about e-mail sent by a registered representative to 50 retail clients are true EXCEPT the communication:
A. must be reviewed and approved in advance by a principal
B. can recommend a new issue
C. can be sent from the branch

can recommend a new issue

Under FINRA rules, if an institutional communication is distributed to retail clients:
I. it is considered to be an institutional communication
II. it is considered to be a retail communication
III. it must be approved by a principal prior to distribution

it is considered to be a retail communication
it must be approved by a principal prior to distribution

Under FINRA rules, a barrier must be put in place between a member firm's:
A. institutional sales department and its retail sales department
B. institutional communications distribution list and its retail communications distribution list
C. institutional

institutional communications distribution list and its retail communications distribution list

Which statements are TRUE about a registered representative that wishes to promote him- or herself on the Internet?
I. The representative can participate in an Internet Chat Room only with approval of the principal
II. The representative can participate i

The representative can participate in an Internet Chat Room only with approval of the principal
The representative can create a website with approval of the principal

Which statements are TRUE about a registered representative that wishes to promote him- or herself on the Internet?
I. The representative can create a website with approval of the principal
II. The representative can create a website with approval of FINR

The representative can create a website with approval of the principal
The FINRA name, when used, must be hyperlinked to the FINRA website

Under FINRA rules, research reports must be approved in advance by the:
A. member firm's investment banking department
B. member firm's supervisory analyst
C. FINRA communications department
D. company that is the subject of the report

member firm's supervisory analyst

A widely-followed research analyst is going to issue a "Buy" recommendation on a company. The analyst and immediate family:
I. can buy the stock prior to the release of the research report
II. cannot buy the stock prior to the release of the research repo

cannot buy the stock prior to the release of the research report
can buy the stock after the research report has been widely distributed

A research report on an issuer CANNOT be published by the underwriter of that issuer's securities for the time period encompassing:
I. 10 days following the effective date for an initial public offering
II. 25 days following the effective date for an init

10 days following the effective date for an initial public offering
3 days following the effective date for a secondary offering

Which of the following is NOT required to be disclosed when a brokerage firm makes a securities recommendation?
A. Whether the firm is an investment banker for that issuer
B. Whether the firm is a market maker in that issuer's securities
C. Whether the fi

Whether the issuer's employees own that issuer's securities

A FINRA member firm has placed a "Buy" recommendation on ABCD stock. In his presentation to customers, a registered representative wishes to use a third party research report that recommends the stock as well. The representative believes that showing that

The use of a third party research report requires prior approval of the supervisory analyst of the member firm
Any research report issued by a FINRA member firm must be approved in writing by a Supervisory Analyst. This is true even if the firm "buys" tha

A representative wishes to invite 30 prospective customers to a buffet dinner, to be followed by a presentation that the representative will make on investing. If the representative includes analyses of specific stocks in the speech; and the attendees use

presentation is considered to be a research report
representative is required to make all of the disclosures required of research analysts

Regulation AC requires that research analysts at member firms MUST give a:
I. written certification on each published research report
II. written certification on each week's published research reports
III. must give a blanket certification to all appeara

written certification on each published research report
must give a blanket certification to all appearances made each quarter

A registered representative is prospecting customers for a new mutual fund being sponsored by his firm. All of the following information items mailed to customers must be accompanied by a prospectus EXCEPT:
A. letter stating the fund's objective(s)
B. sal

letter stating the fund's objective(s)
Because mutual funds are "prospectus offerings," nothing can be sent to customers that can be considered an offer or advertisement of the security unless the material is preceded or accompanied by a prospectus. Sales

Which of the following is (are) prohibited in mutual fund advertising?
I. Showing past performance
II. Showing projected performance
III. Showing past performance against a benchmark index

Showing projected performance

A registered representative recommends the purchase of a new issue to the customer, and believing that the prospectus is too difficult for the customer to understand, prepares an abstract of the prospectus to send for the customer to read. This action is:

prohibited

Which of the following is a record that must be retained on file by a broker-dealer?
A. Prospectuses
B. Recommendations
C. Complaints
D. Solicitations

Complaints
Broker-dealers are not required to retain, as a record, recommendations made to clients. Customer complaints, account statements, and advertising are all records that must be retained by broker-dealers.

To make a public offering of a Direct Participation Program, which statements are TRUE?
I. The offering must be registered with the SEC
II. The offering does not have to be registered with the SEC
III. The offering is subject to regulation by FINRA
IV. Th

The offering must be registered with the SEC
The offering is subject to regulation by FINRA

Which of the following gifts CANNOT be accepted by a registered representative from a mutual fund sponsor?
I. All expenses paid trip to Bermuda
II. $50 gift certificate
III. $500 cash
IV. $1,000 towards the purchase of fund shares

All expenses paid trip to Bermuda
$500 cash
$1,000 towards the purchase of fund shares

Which of the following statements are TRUE regarding fidelity bonds?
I. Member firms are required by FINRA to maintain fidelity bond coverage
II. Member firms are not required by FINRA to maintain fidelity bond coverage
III. A fidelity bond is insurance a

Member firms are required by FINRA to maintain fidelity bond coverage
A fidelity bond is insurance against loss due to employee theft

If a customer wishes to find out about a registered representative's disciplinary history, this information is:
A. sealed and cannot be given to customers
B. available from the Securities and Exchange Commission
C. available in the Federal Register
D. ava

available from the Central Registration Depository on the BrokerCheck website
FINRA maintains a "BrokerCheck" website, where retail customers can input a registered representative's name and see that individual's employment history for the last 10 years,