Series 14 CH. 1

Ch. 1 -

The difference between the discounted price the underwriter pays and the full price it receives (POP) is

the underwriting spread (main portion of underwriter’s compensation)

List exempt securities

• Securities issued by federal govt (bills, notes, bonds)

• Muni Securities

• Securities issued/regulated by govt agencies or govt sponsored entities 9mortgage backed and CMOS)

• securities issued by banks and credit unions banks are regulated in part by the Federal Deposit Insurance Corp and credit unions by the National Credit Union Association)

Securities Act of 1933

AKA Securities Act or Paper Act

Investors have right to make informed decisions on securities

Requires majority of investors to go thru registration and disclosure process

Securities Act of 1934

AKA Exchange Act or People Act

regulated how existing securities are resold between investors (Secondary market)

Established the SEC

Regulated BDs and ppl who work for them

SEC allows _____ to be the primary regulator for OTC

FINRA

Exchange-traded securities are considered

National Market System (NMS) securities

NMS required US exchanged to be linked together in the form of a ____ and reported to _____

consolidated tape and consolidated quotation system (CQS)

at least ____% of an investment company’s BOD must be non-interested persons

40

Advisers who manage at least $100 mn or more in client assets must register

with SEC

Investment advisers who manage at least $100 mn and less than $110 mn in assets under management can choose to register

either on federal or state level

Advisors managing less than $100 mn must register with

the regulatory agencies of the states they practice in. 

IF state of residence does not require registration, advisers must register with SEC

FINRA is responsible for ____% of the US Equity markets

80

Complaints must be served in writing to

the accused firm/associated person and the Office of Hearing Officers

An accused firm has ___ days to respond after the receipt of a complaint

25

an accused firm has ___ days to respond to a 2nd notice (if first notice is ignored)

14 days

If a hearing officer has to make a default decision, it will become final after ___ days 

25

if an MVRP letter is accepted by the NAC, the respondent will be fined an amt up to

$2500

within ___ days after a respondent has answered a complaint, the hearing officer may order a prehearing conference

21

within ___ days of the court’s finding of fact and post-hearing bried, the CHO must prepare a written decision approved by majority of the hearing panel

60

within ___ days after a decision has been made, the Enforcement Dept, or the Market Regulation Dept may file a written notice of appeal with the NAC which will appoint a subcommittee to hear the appeal.

25

how many days does a firm have to file a motion objecting pr proposing alternative restrictions during appeals process

10

statute of limitations for arbitration is

6 years

arbitration of disputes with customers is mandatory only when

requested by a customer (written) or by contract

public arbitrator

no present association with industry and has not been employed in the industry in at least the past 20 years

nonpublic arbitrator

person employed by the securities industry or has been employed within the last 5 years

initial statements of claim must be files in

an Arbitration Submission Agreement to the Director of Dispute resolution

the panel must render its decision within ___ days of closing the record

30

if parties want an explained decision, all parties mut pay ___

$400

A GNMA is issued by ____ and Guaranteed by the US ___

a private third party (ex. bank), formally

under which act are muni advisors required to register

1934

Freddie Mac and Fannie Mae are considered what

GSE

Which law created the SEC

securities exchange act of 1934