The SEC is empowered to take all of the
following enforcement actions against
registered persons and firms EXCEPT
A. Imposing fines
B. Revoking registration
C. Bringing criminal charges
D. Censuring firms
C) Bringing criminal charges
FINRA derives its power to regulate the US
securities industry from which authority?
A. The Securities Act of 1933
B. The Securities Exchange Act of 1934
C. The SEC
D. The executive branch of the US
government
C) The SEC
Which one of the following participants in the
municipal bond market is not subject to rules
of the MSRB?
A. A municipal bond issuer
B. A broker-dealer that is active in the
municipal market
C. A municipal securities market maker
D. A municipal securities
A) A municipal bond issuer
Which information contained on a new rep's
Form U4 must be verified by the FINRA
member firm that sponsors him or her?
A. Five years of residential address history
B. Educational background
C. The three most recent years of
employment history
D. Recent li
C) The three most recent years of employment history
Carl is a registered rep with ABC securities. His
wife gets seriously ill and he must stay home
to care for her. He doesn't want to quit work,
so he asks ABC whether he can make his home
his official office of employment. This address
change takes place o
D) Yes, by May 31
When Jamie joined his broker-dealer, he was
required to sign a pre-dispute arbitration
clause. Which of the following type of disputes
will not automatically be settled by arbitration,
under this clause?
A. Discrimination and sexual harassment
B. Discrimi
A) Discrimination and sexual harrassment
Must all employees of a FINRA member meet
FINRA's finger-printing requirement?
A. Yes, there are no exceptions.
B. No, only registered principals must be
fingerprinted.
C. No, only registered principals and sales
people must be fingerprinted.
D. No, emplo
D) No, employees with purely secretarial duties need not be fingerprinted
Oliver has tried twice to pass his Series 7 Exam
and failed both times. If he tries a third time
and fails again, what happens?
A. He can't be sponsored again for the exam
by the same firm.
B. He must take a comprehensive securities
industry education cou
C) He must wait 180 days to retake the exam
In what important way is FINRA's Securities
Industry Essentials (SIE) Exam different from
the Series 7 Exam?
A. The SIE applicant does not need to be
sponsored by a FINRA member.
B. The SIE test includes a series of essays.
C. The SIE is optional; new ent
A) The SIE applicant does not need to be sponsored by a FINRA member
How do FINRA members notify FINRA that
a registered person's employment has been
terminated?
A. By filing an amended Form U4 within 10
calendar days of termination
B. By sending FINRA a signed, certified copy
of the former employee's termination
letter, w
C) By filing Form U5 within 30 calendar days of termination
Jerry, a customer, is unhappy with his current
securities firm and broker. He calls another
securities firm in town and asks whether that
firm can suggest one of their reps to him. The
firm says he should talk to Alex, who has 20
years in the business. Ho
C) Look Alex up on BrokerCheck
Which of the following statements is TRUE
regarding investment advisers (IAs)?
A. All IAs must register with the SEC.
B. IAs typically charge for the transactions
they execute.
C. IAs have a fiduciary obligation toward
their clients.
D. IAs are interchang
C) IAs have a fiduciary obligation toward their clients
When a new person becomes securities licensed,
what is the maximum amount of time she can procrastinate in meeting the
Regulatory Element CE requirement, without
becoming CE inactive?
A. One year and 60 days
B. Two years and 120 days
C. Three years and 30
B) Two years and 120 days
How often is a registered rep required to
complete the Firm Element requirement?
A. Annually
B. Every two years
C. Annually in the first year and then every
two years thereafter
D. There is no specific requirement; the
frequency depends on each firm's pla
A) Annually
Clarence is a registered rep who recommends
fee-based mutual fund wrap accounts to his
clients. These are advisory accounts, and
his role is to work under an SEC-registered
investment adviser, providing advice to clients
and managing the portfolios by mak
D) Yes, with his state
Which one of the following providers of
investment advice is required to register with
the SEC?
A. Fee-based financial planner, with $200
million of assets under management
B. Portfolio manager for wealthy people, with
$75 million of assets under manageme
A) fee-based financial planner w/ 200 AUM