Series 24 (round 2) - Unit 1 || with Error-free Solutions.
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Module
Series 24 -
Institution
Series 24 -
Why was FINRA created? correct answers - Eliminate duplicate regulation by NASD and the NYSE
- Strengthen the competitiveness of U.S. markets
What is the mission of the SEC? correct answers Protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation
FIN...
Series 24 (round 2) - Unit 1 || with Error-free Solutions.
Why was FINRA created? correct answers - Eliminate duplicate regulation by NASD and the
NYSE
- Strengthen the competitiveness of U.S. markets
What is the mission of the SEC? correct answers Protect investors, maintain fair, orderly, and
efficient markets, and facilitate capital formation
FINRA has the obligation (or authority) to... correct answers - Establish and interpret rules
regulating the OTC markets
- Take appropriate steps to ensure compliance with these rules
- Examine and investigate members and their APs to determine violations of FINRA or MSRB
rules, federal securities laws, or state regulations
- Dispute resolutions
- Administer qualification exams and CE programs
- Operate the CRD
- Determine if membership applicants meet FINRA guidelines
- Determine whether persons seeking to register are subject to SD
- Establish fees and other assessments to be levied on member firms
- Own both quote and trade reporting facilities (TRF), such as the OTCBB, ORF, TRACE, ADF,
FINRA/ NASDAQ TRF, and the FINRA/ NYSE TRF
- Market Data
- Educate industry professionals and investors
- Oversee investor protection services such as BrokerCheck... (FINRA member firms that have
websites are required to include a readily apparent reference and hyperlink to BrokerCheck on
their initial landing page intended to be viewed by retail investors in addition to any other web
page with a professional profile of the registered persons)
With limited exception, where must BDs be registered? correct answers With the SEC, FINRA
and the states (U.S. territories such as PR, Guam, etc.) which it operates
Form NWA correct answers Where the registration process begins via a new membership
application... Filing this form opens a 180-day application review window...
What is a "Broker"? correct answers Any person engaged in the business of effecting
transactions in securities for the accounts of others
What is a "Dealer"? correct answers Any person acting on behalf of their own proprietart trading
account
What is an "Investment Advisor"? correct answers A person who, for compensation, advises
other directly or via publication or writings, as to the value of securities or as to the advisability
of purchasing or selling securities. OR who, for compensation and as part of a regular busines,
issues or promulgates analyses or reports concerning securities.
, They may be registered with the SEC or the states subject to certain conditions. Unlike BDs, IAs
do not register with FINRA. Form ADV is used by IAs to register with the SEC or state
securities authorities.
Form BD correct answers The Uniform Application for BDs to register with the SEC, SROs and
states through the CRD, operated by FINRA. Whenever the form becomes inaccurate or
incomplete, the DB is required to PROMPTLY (no later than 30 days) to update.
Can you use a fictional name for "doing business"? correct answers YES, this is acceptable as
long as the name is filed with FINRA and SEC
FINRA regulates what? correct answers The trading of OTC nonexempt securities. Firms that
transact business in nonexempt securities must register with FINRA and SEC.
The Municipal Securities Rule Making Board (MSRB) regulates what? correct answers Provides
resistration and opperating rules, as well as reporting transparency services for those BDs who
operate in the municipal fixed income space
The BD applicant must file supporting information or statements regarding its ability to meet the
standard for admission under FINRA Rule 1014, including... correct answers
Except for sole proprietorships, all applicants must have at least ____ officers register and
qualify as appropriate principals. correct answers 2
The Department of Member Regulation (DMR) issues a written decision on a firms BD
application within how many days? correct answers 30-days of the premembership interview...
The decision will be to:
- Grant the application
- Grant the application with certain restrictions
- Deny the application
Form BR correct answers
FINRA, or appropriate SRO, is required by the SEC to conduct an inspection of newly registered
member firms within how many months of the members registration (with the SEC) to ascertain
whether the member is operating in conformity with financial responsibility rules? correct
answers 6-months
Disiplinary sanctions within the previous ____ years by the SEC, another SRO, a foreign
financial regulator, or state or federal law enforcement agency can be cause for statutory
disqualification (SD) from FINRA membership indefinitely? correct answers 10-years
The firm will be denied membership for the following reasons... correct answers If the applicant
OR any associated person:
- Has been expelled or suspended by another SRO or from the foreign equivalent of an SRO
- Is subject to an SEC order denying, suspending, or revoking registration as a BD
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