Series 63 Registration & Licensing

A Federal Covered Adviser discovers a material error in its Form ADV. When must Form ADV be amended with the State to correct the error?
A. Never
B. Within 5 business days
C. Within 30 calendar days
D. On the SEC filing anniversary

C. Form ADV is filed through the IARD Investment Adviser Registration Depository) system run by FINRA - this is used by both Federal Covered and State-registered advisers. In IARD, the adviser details whether this is a Federal or State registration and IA

Under the Uniform Securities Act, if an Investment Adviser limits its clientele to insurance companies, which statement is TRUE?
A. The investment adviser must register with the State of residence of the insurance company
B. The investment adviser is exem

B. Investment advisers with no place of business in a State that limit their clientele to insurance companies and investment companies are exempt from registration because they are dealing with professionals - not the general public. Note that if an advis

Under NASAA rules, which record is NOT required to be retained by an investment adviser?
A. Written customer complaint received 4 years ago
B. Advertising copy distributed to the public 2 years ago
C. Trial balance of the investment adviser prepared 1 yea

D. Advisers must retain records for 5 years under NASAA rules (note that this differs from SEC rules for broker-dealer records, most of which must be retained for 3 years). The first 2 years' worth of records must be kept at the adviser's principal office

An individual holding a CFP designation can get a waiver from taking the:
A. Series 63 examination
B. Series 65 examination
C. Series 66 examination
D. Either the Series 65 or 66 examination

B.
State Administrators will grant a waiver from taking the Series 65 exam to anyone holding a:
CFP - Certified Financial Planner (granted by the CFP Board of Standards);
CIC - Chartered Investment Counselor (granted by the Investment Adviser Association)

An Administrator is allowed to start a suspension or revocation action against a registered broker-dealer:
I on the basis of facts known at the time of the initial registration
II after one year has elapsed from the time a broker-dealer withdraws from reg

B. The Administrator cannot suspend or revoke a broker-dealer's registration on the basis of facts known at the time of the initial registration. If there was a problem with the initial registration based on those facts, then registration would have been

A broker-dealer's agent that is registered in State A, wishes to sell a security in State B. Which of the following may be sold in State B without the agent being registered in State B?
I U.S. Government Agency Issues
II Commodity Futures
III Fixed Annuit

B.
Since commodity futures and fixed annuities are not defined as securities, they are not regulated by the Uniform Securities Act. If an agent registered in State A, wishes to sell securities in State B, the agent must be registered in State B unless an

A BD application is received by the State Administrator for a new broker-dealer subsidiary of a Swiss securities firm. The application includes the disclosure that the parent firm was suspended from membership on the Deutsche Bourse 6 years ago because of

A.
The Uniform Securities Act sets a 10 year statute of limitations for securities related violations as a cause for denial of registration. This is based on violations of U.S. law. It also includes a provision regarding violations of the law of a foreign

Which of the following individuals would be defined as an "agent" under the Uniform Securities Act?
A. A secretary who works for an agent taking telephone messages to buy and sell securities
B. A sales associate who accepts orders for limited partnership

B.
An "agent" is an individual that represents a broker-dealer or issuer effecting securities transactions. The Act exempts from licensing as an "agent," those individuals who do not deal with the public. Thus, individuals representing issuers who deal so

Which of the following are EXCLUDED from the definition of an investment adviser under the Uniform Securities Act?
I An employee of an investment adviser
II A federal covered adviser
III A savings and loan institution
IV A broker-dealer
A. I only
B. I and

D. If a person is excluded from the definition of an investment adviser, then that person will not have to register in the State as such.
Excluded from the definition of an investment adviser are:
employees of investment advisers (they must register separ

Which of the following statements is (are) TRUE about registration as an agent for a broker-dealer?
I An unregistered agent can solicit business in a State once the agent's broker-dealer has been registered in that State
II A registered agent can only sel

B. As an agent, one cannot solicit business in a State unless both the agent and the broker-dealer are registered in the State. This is true, even if the agent wishes to sell exempt securities - the agent must still be registered, though the security is n

Under the Uniform Securities Act, a person who renders investment advice solely about U.S. Government Agency securities is defined as a(n):
A. investment adviser and must register under the Act
B. federal covered adviser, and is not required to register u

B. A person who gives investment advice relating solely to U.S. Government securities (including Agency securities), is excluded from Federal registration under the Investment Advisers Act of 1940. Any person excluded from registration with the SEC under

You are an agent registered in a State where you have a customer. The customer will be going to college in another State. May the agent still do business with the customer, even though the agent is not registered in the State where the student is going to

C.
College students are considered to be residents of the State where their home is; not the State where they are going to college. Furthermore, this is an existing customer of the agent - the agent is not soliciting new business in State B.
The agent doe

A fee payment is NOT required to be made when a(n):
A. agent of a broker-dealer registers in a State for the first time
B. new broker-dealer files as a successor to a firm that has ceased operations
C. renewal registration is filed by an investment advise

B. If a new broker-dealer is created as a successor firm to an existing registered broker-dealer that has ceased business operations at some point during the year, then the State does not require a new filing fee to be paid. The fee is paid at the initial

A person makes an initial application for State registration on March 1st. The registration expires:
A. at such a date as set by the Administrator
B. on December 31st of that year
C. on March 1st of the following year
D. only upon withdrawal by the applic

B. Registration applications for broker-dealers, investment advisers, and agents expire on December 31st of each year, unless the Administrator changes that date. If a new application is filed in mid-year, it will expire at the end of that year.

If an agent fails to renew his or her license at the end of the year, the:
A. registrant must retake the Series 63 or 66 examination
B. registration expires with no action by the Administrator
C. registration is automatically renewed and a late fee is ass

B. If an agent fails to renew his license after the 1 year registration period, the license expires with no action on the part of the Administrator. The renewal is handled by the registration department of the broker-dealer with whom the agent is affiliat

The Administrator would revoke the license of an agent for all of the following reasons EXCEPT the Administrator:
A. has attempted to locate the agent at his or her last known address and has determined that the agent is no longer at that location
B. find

C. The Administrator cannot revoke the registration of an agent based solely on lack of experience. Registration can be revoked if the Administrator cannot locate the agent (e.g., the agent has moved, but has not notified the Administrator of his or her n

Under the NASAA Model Rule covering Investment Adviser records, the adviser's articles of incorporation must be retained for:
A. 3 years
B. 5 years
C. for the life of the firm plus an additional 3 years
D. for the life of the firm plus an additional 5 yea

C. NASAA's recordkeeping rule for investment advisers requires that "partnership articles and any amendments, articles of incorporation, charters, minute books and stock certificate books of any investment adviser be preserved for at least 3 years after t

Under the Uniform Securities Act, an investment adviser who has no place of business in a State is exempt from registration if the:
I firm's clients consist solely of institutional investors in the State
II firm has no more than 5 clients other than finan

B. An investment adviser with no place of business in a State is exempt from registration if its clients consist solely of institutional investors; or if the firm has no more than 5 clients in a 12 month period other than institutional investors. Under St

Under NASAA, investment advisers must update their ADV filing made with the State:
I yearly, within 90 days of calendar year end
II yearly, within 90 days of fiscal year end
III within 30 days of any significant material change
IV within 90 days of any si

C.
Under NASAA rules, investment advisers must update their Form ADV (State registration form) annually, within 90 days of fiscal year end, to reflect current and accurate information and must send the updated Form ADV to its clients within 120 days of ye

Which of the following is (are) defined as a "broker-dealer" under the Uniform Securities Act?
I A person who effects securities transactions for its own account
II A person who effects securities transactions for the account(s) of others
III An agent of

C. Under the Uniform Securities Act, a "broker-dealer" is defined as a person that engages in the business of effecting securities transactions for the account of others; or a person that engages in the trading of securities for its own account. Thus, Cho

An individual who represents an issuer selling federally covered investment company securities:
A. is not required to register as an agent in the State
B. must register as an agent in the State if compensation is being paid for this activity
C. must regis

B.
If an individual represents an issuer selling a security that must be SEC-registered and compensation is paid for this activity, then the individual must register in the State. Both "nationally traded securities" and investment company securities are

To register a successor firm with the State Administrator for the unexpired portion of the current license year, which statement is NOT true?
A. The predecessor firm must have ceased business operations and can only conduct winding down transactions
B. Th

B. Uniform State law does not require the filing of a new registration application for a successor firm. The successor firm files a registration amendment with the State, that takes its registration through the end of that year, without having to pay a ne

Investment adviser representatives that have a place of business in the State:
I must register with the State if they are affiliated with a federal covered adviser
II are not required to register with the State if they are affiliated with a Federal covere

A. States require registration of investment advisers that are not "federal covered advisers." They require "notice filings" from federal covered advisers doing business in their States.
Even though State registration is not required for federal covered a

Annual renewal of registration as an agent or an investment adviser in each State is made by filing:
I Form U-4
II Form U-6
III within 30 days of the date that renewal statements are sent out
IV within 60 days of the date that renewal statements are sent

A. A standard registration form (Form U-4) in used for federal and state registration of agents and state registration of investment adviser representatives. CRD and IARD send out renewal statements for each registered person in mid-November, and these mu

After successfully completing the Uniform State Law exam, an agent can solicit:
I immediately
II after registration has been granted by the Administrator
III if the individual is affiliated with a broker-dealer
IV if the individual has met minimum experie

B. After passing the Uniform State Law exam, an agent can solicit when the registration becomes effective (not immediately). This occurs 30 days after the date the exam is passed, if no problems arise. To be registered as an agent, an individual must be a

A State Administrator can require that a new investment adviser who files a registration application in the State file:
I Proposed advertising
II An announcement of the application in 1 or more newspapers
III Standardized form letters to be used for prosp

D. Under the Uniform Securities Act, the Administrator can require the filing of any prospectus, pamphlet, circular, form letter, advertisement or other sales literature or advertising communication addressed or intended for distribution to prospective in

All of the following are EXCLUDED from the definition of a broker-dealer under the Uniform Securities Act EXCEPT a firm with no place of business in the State that:
A. has a few clients in the State with a de minimis exemption
B. deals exclusively with is

A.
Excluded from the definition of a broker-dealer under Uniform State Law are persons with no place of business in the State that effect transactions exclusively with issuers; other broker-dealers; depository institutions; insurance companies; investment

A surety bond requirement for registration of a broker-dealer:
A. protects each customer against loss of principal in the event of the failure of the broker-dealer
B. can be met by using the broker-dealer's existing fidelity bond coverage
C. can be used b

C. Broker-dealers, as a condition of registration in a State, can be required to post a surety bond. This must be posted as either cash, securities, or an indemnity policy issued by an insurance company. In the event that there is a legal action taken aga

Two companies, Company A and Company B, are involved in a securities offering. Company B is selling its stock. Company A's employees help sell the shares. Company A receives commissions from Company B and pays the commissions to its staff. Therefore, the

A. Since Company A's employees are being compensated for selling the shares of Company B, Company A is defined as a "broker-dealer" and Company A's employees are agents of the broker-dealer. Both Company A and its employees would be required to register i

A broker-dealer that is registered in Canada and that is not registered in any State may effect transactions in Canadian securities:
A. with any existing customer that is a Canadian citizen who is vacationing in the United States
B. with a new customer th

A. An exemption from registration is given to Canadian broker-dealers that have no place of business in a State that are dealing with pre-existing customers who are vacationing in that State. This addresses the fact that Canadian citizens often visit the

Administrators can require minimum Net Capital and Net Worth for:
A. Agents
B. Broker-Dealers
C. Investment Adviser Representatives
D. Issuers

B. Under the Act, minimum Net Capital and Net Worth requirements can be set by the Administrator to register broker-dealers and investment advisers. There is no such requirement for agents or investment adviser representatives. Issuers do not register und

In most States, an agent may be associated at one time with no more than:
A. 1 broker-dealer
B. 2 broker-dealers
C. 3 broker-dealers
D. 4 broker-dealers

A. Most States do not allow dual registration - an agent may only be associated with 1 broker-dealer at any time. However, it is permitted, in all instances, for an agent to be registered with a number of broker-dealers that are under "common control." Fo

A "consent to service of process" must accompany which of the following?
I Agent's initial registration application
II Agent's renewal registration application
III Investment Adviser's initial registration application
IV Civil complaint filed against a br

C. "Consent to service of process," which appoints the Administrator as attorney for that person to receive legal documents, is required on each initial registration application. This is true for registration of agents, broker-dealers, investment advisers

Each sole proprietor that applies for initial registration in a State as either a broker-dealer or investment adviser must file:
A. an annual personal income statement
B. copies of federal tax returns for the prior 3 years
C. a statement of financial cond

C.
A sole proprietorship is an unincorporated business that consists of 1 person. Sole proprietors can register in a State as a broker-dealer or as an investment adviser. Each applicant for initial registration that is a sole proprietor must file an origi

A person who renders advice on variable annuities for a fee; and who then sells the annuities, charging a commission, MUST:
I register as an investment adviser in that State
II register as a broker-dealer in that State
III register as an agent in that Sta

B. A variable annuity is defined as a non-exempt security under the Uniform Securities Act. If advice is rendered for a fee about variable annuities, then registration as an investment adviser would be required. If a variable annuity is sold for a commiss

A registration application in a State filed by an Investment Adviser becomes effective:
A. on a date so determined by the Administrator
B. at noon, the 30th day after the application is filed
C. at noon, the 45th day after the application is filed
D. at n

B. The wording in the Uniform Securities Act is that: "If no denial order is in effect and no proceeding is pending, registration becomes effective at noon of the thirtieth day after an application is filed." It then goes on to say that: "The Administrato

An agent who has passed his or her examination, but whose registration is not yet effective in the State, may sell:
A. mutual funds for which no commission is paid
B. fixed annuity investments
C. exempt securities
D. corporate bonds

B. Passing the Series 63 or 66 does not automatically register an agent in a State. Registration is typically effective 30 days after filing the application, given that the conditions of registration have been met (such as passing the Series 63 or 66 test

Apart from the filing of a registration for a broker-dealer, separate registration is required for each individual that is a(n):
A. partner of the broker-dealer
B. director of the broker-dealer
C. agent of the broker-dealer
D. all of the above

C. Named in the registration statement for a broker-dealer are the partners, officers, and directors of the broker-dealer. These persons do not have to make a separate agent filing in the State. However, any person who sells or solicits for the broker-dea

A director of a broker-dealer that is registering for the first time in a State:
A. is not permitted to register as an agent in that State
B. must apply separately for registration as an agent
C. must request that the broker-dealer file a registration for

D.
Included in a State registration application are the names, addresses and background of the officers of the broker-dealer, and these individuals become automatically registered when the broker-dealer entity becomes registered in the State. This is part

Which one of the following items would be included in the computation of an investment adviser's net capital?
A. Copyright owned by the adviser
B. Franchise right owned by the adviser
C. Advance to an officer of the adviser
D. Sofa and chair owned by the

D.
Net capital is really a firm's "liquid net worth." It is liquid assets minus all liabilities.
Excluded from assets that count in net capital are any intangible assets, including deferred charges, goodwill, franchise rights, organizational expenses, pat

Which statement is TRUE?
A. All securities sold through a broker-dealer in a State must be registered in the state
B. An agent may maintain his registration without being affiliated with a broker-dealer
C. An agent's registration can never be revoked with

C. The true statement is that a registration can never be revoked without the opportunity for a hearing. It is not true that all securities sold in a State must be registered - no registration is required if the securities are exempt, federal covered, or

Which of the following with a place of business in the State are required to register in a State?
I Investment adviser representative
II Federal covered adviser representative
III Broker-dealer representative
A. III only
B. I and III only
C. II and III on

D. Investment adviser representatives with a place of business in the state must register in the State; as must their investment adviser firms. Federal covered adviser representatives with a place of business in the State must also register in their State

All of the following are EXCLUDED from the definition of an investment adviser under the Uniform Securities Act EXCEPT a(n):
A. federal covered adviser
B. broker-dealer
C. adviser with no place of business in the State whose only clients are broker-dealer

C. Excluded from the definition of an investment adviser are investment adviser representatives; depository institutions; broker-dealers; professionals who only give incidental advice; publishers of general circulation periodicals that do not give investm

Under the provisions of the Uniform Securities Act, a "person" includes:
I A parent that is acting as custodian
II An adult couple
III Municipality
IV Corporation
A. I and II only
B. III and IV only
C. II, III, IV
D. I, II, III, IV

D. A "person," as defined under the Act, can be just about anyone who has legal authority to issue or trade securities. A custodian account opened for a minor is a person (note that a minor acting on his or her own is not a "person" since a minor has no l

Which of the following individuals is defined as an "agent" under the Uniform Securities Act?
A. An individual who represents an issuer in sales of non-exempt securities
B. A person who effects securities trades for his own account as a regular course of

A.
An agent is defined as an individual who represents either a broker-dealer or an issuer in effecting securities transactions with customers.
An individual who represents an issuer effecting sales of exempt securities is excluded from the definition - t

A person who renders advice on fixed annuities for a fee; and who then sells the annuities, charging a commission:
A. must register as an investment adviser in that State
B. must register as a broker-dealer in that State
C. must register as an agent in th

D. Since a fixed annuity is not defined as a security (instead it is defined as an insurance product), State securities law does not apply! (However, State insurance laws do apply, but they are outside of the scope of this examination.) There is no requir

At the initial registration of a broker-dealer, which of the following individuals would automatically be registered as an agent of that broker-dealer?
A. officer of the broker-dealer
B. director of the broker-dealer
C. both of the above
D. none of the ab

C. The registration of a broker-dealer automatically constitutes the registration of that firm's officers, partners, and directors as agents since all of these individuals are named in the registration document.

Which statement is TRUE about re-registration of broker-dealers in the State?
A. Broker-dealers are not required to re-register in the State
IB. Broker-dealers must re-register in the State annually, based upon their fiscal year end
C. Broker-dealers must

C. Annual registration renewal in each State is required for broker-dealers, investment advisers, and their agents. This occurs at December 31st of each year, so it is based on calendar year end - not a registrant's fiscal year end.

Which statement is TRUE about registration of broker-dealers, investment advisers and their agents in a State?
A. Registration as a broker-dealer or investment adviser expires 1 year from its effective date of January 1st
B. A firm that has both broker-de

A. Registration of broker-dealers, investment advisers and their agents expires on December 31st of each year unless renewed. If a firm has both a broker-dealer entity and an investment adviser entity, each must register separately in the State. Registrat

A Registered Investment Adviser is one that is registered with (the):
A. FINRA
B. NASAA
C. SEC
D. MSRB

C. An investment adviser must either register with the SEC as a Federal Covered Adviser (one with at least $100 million of AUM); or if it has less than $100 million of AUM, it registers with the State. There is no investment adviser registration with FINR

Which of the following would be defined as a broker-dealer in State A?
A. The municipal bond department of a bank located in State A
B. A person who gives advice about investing in securities in State A
C. A broker-dealer located in State B who has an exi

C. Banks are excluded from the definition of a broker-dealer, making Choice A incorrect. Choice B defines an investment adviser; not a broker-dealer. Choice D defines an agent of a broker-dealer; not the broker-dealer itself.
Choice C gets at an interesti

Under Uniform State Law, an agent is permitted to sell securities for more than 1 broker-dealer:
A. only if the types of securities offered by each broker-dealer are mutually exclusive
B. only if the agent is separately registered with each broker-dealer

B. The typical arrangement is that an agent is only registered with one broker-dealer, both at the Federal and State level. However, in rare cases, an agent may be "dual registered." This occurs most often if one broker-dealer sells a very limited product

The term "issuer" applies to a:
A. person who proposes to sell a security
B. director of a company that is selling new shares to the public
C. trader executing trades off an exchange floor
D. market maker in a security traded over-the-counter

A. An "issuer" is defined as any person who issues, or proposes to issue, a security. Directors of companies that are selling new issues are not issuers. However they can be defined as "agents" of the issuer. Traders execute trades in the secondary market

Which of the following are generally required to be included in the State registration application of a broker-dealer or investment adviser?
I Consent to service of process
II Business history of applicant
III Fingerprints of the officers
IV Books and rec

C. State registration applications for a broker-dealer or investment adviser must include:
The applicant's form and place of organization;
The applicant's proposed method of business;
The qualifications and business history of the applicant and each of it

Under the Uniform Securities Act, all of the following measures must be taken to ensure the integrity of data stored electronically EXCEPT:
A. the records must be preserved in a non-rewritable format
B. the records must be preserved in a non-erasable form

D. In order to ensure the integrity of electronically stored data, the storage medium must be non-rewritable and non-erasable. A separate duplicate copy must be retained in another location. There is no requirement for the record to be encrypted - this ma