Quick Quiz 1.

A
True or false
1. In general, a person who effects transactions in securities for itself or for the
account of other in the course of business must register in the state as a
broker dealer
2. Under the USA, an out of state firm that transacts business with an
established customer who is on vacation is not considered a broker-dealer in
the state in which the customer is on vacation
3. A person not defined under the USA as a broker-dealer in the state need not
register as such
4. A broker-dealer registered in several states must meet the net capital
standard of the state with the most stringent requirement.
Quick Quiz 1.B
Here are the examples of question you might see on the exam :
1. Under the uniform securities act, the term agent would include an individual
who represents an issuer in effecting non- exempt transactions in
A. A city of Montreal general general obligation bond
B. Common stock offered by a commercial bank
C. A New Jersey turnpike Revenue bond
D. Non exempt securities
2. Under the uniform securities act the term agent would include
A. An individual who represent an issuer I transactions in exempt
securities
B. An individual who represent a broker dealer in a transaction in an
exempt security
C. A receptionist for a broker dealer who directs calls for trade information
to the appropriate individual
D. The vice president of personnel for a national brokerage firm

Quick Quiz 1.C

Write A if the person is an agent and B if not
A. A person who effects transactions in municipal securities on behalf of
a broker dealer.
B. An agents salaried who takes buy and sell orders from clients
C. An employee of a bank whose job is selling securities issued by the
bank
D. An individual who represents an her non exempt employer In the sale
of its securities to exiting employees for a commission
E. A person who represents an issuer in effecting transaction with
underwriters

Quick Quiz 1.D

Under the USA the definition of investment adviser would include
A. A bank
B. A lawyer charging a fee to advice clients how to invest an injury
settlement he just won for them
C. An investment adviser representative
D. None of the above
Quick Quiz 1.E
Write A if the phrase an investment adviser that must register under the USA
and B if it does not
1) Publisher of a newspaper that renders general financial advice
2) Broker dealer that charges a fee for providing investment advice over
and above commission from securities transactions
3) Investment adviser that manages $10 million in assets
4) Publisher of a monthly investment newsletter with an annual
subscription fee that does not render specific advice based on the
needs of any subscriber

Quick Quiz 1.F

True or False?
1) An investment adviser representative must register with the SEC
if she has clients with assets of $110 million or more under
management
2) An investment adviser maintaining custody of a customers
securities or funds and exercising discretion in the account is
generally required to maintain a minimum net worth of $35000
3) An employee of an investment advisory firm is an investment
adviser represent if his duties are limited to clerical activities
4) An administrative employee who receives specific
compensation for offering investment advisory services is not an
investment adviser representative
5) An employee of an investment advisory firm is an investment
adviser representative if his duties involve making investment
recommendations.
6) Under the USA ,the term investment adviser representative
would NOT include
A. An officer of a registered investment advisory firm whose
responsibility includes supervision of solicitors
B. An associated person of the firm who, from time to time,
makes specific recommendations to clients
C. A payroll clerk employed by an advisory firm whose
responsibilities includes computing the earning of
investments adviser representative
D. A new employee of an advisory firm who has only been
able to sign up 2 clients in his first 4 months

Quick Quiz 1. G
1) Under the USA , which of the following automatically becomes
registered as an agent when a broker deals registration becomes
effective?
A. Only the designated supervisory principal
B. Any partner officer or person of similar status or similar
function whose activities fall under the definition of an
agent
C. All agents currently registered with FINRA through that
broker dealer
D. No one

2) Under the USA , which of the following statements regarding the

registration of a successor firm is (are) TRUE?
A. The appropriate filing fee must be included with the
application
B. The successor firm must be in existence before the filing
of the application
C. The registration of the successor firm will be effective
until the December 31 renewal date
D. All of the above.
Quick Quiz 1.H
True or False?
A. A consent to service of process must be submitted with each
renewal application
B. An administrator may establish net capital requirement for
investment adviser representatives
C. When a securities professional registers in a state , he must
provide the state Administrator with a list of all states in which
he intends to register
D. A Canadian broker dealer properly registered with the
Administrator of the province in which he is headquartered and
with no office in the state, may do business with his customers
who are on a skiing vacation in Vail without registering with the
Colorado Administrator

Quick Quiz 2.A

1. Which list of instrument below is NOT composed of securities?
A. Stock treasury stock ,right, warrants, transferable shares
B. Voting trust certificates interest in oil and gas drilling programs
C. Commodity futures contracts fixed payment life insurance
contracts
D. Commodity options contracts interest in multilevel
distributorship arrangements
2. In the Howey case, the U.S. Supreme Court defined an investment
contract as having 4 components. which of the following is NOT part of
the 4 part test for an investment contracts?
A. An investment of money
B. An expectation of profit
C. Management activity by owner
D. Solely from the efforts of others
3. Nonexempt securities
A. Need not be registered in the state in which they are sold
B. Always must be registered in the state in which they are sold
C. Need not be registered if sold in an exempt transaction
D. Need not be registered if sold in a nonexempt transaction
4. A nonissuer transaction is a transaction
A. Between 2 corporation in which one is issuing the stock and the
other is purchasing
B. In which the issuing corporation will not receive the proceeds
from the transaction
C. In which a mutual funds purchase a Treasury bond directly from
the Government
D. In which the security must be registered

Quick Quiz 2.B

True or False?

1. ABC shoe company, a new retail shoe chain ,has applied for the
registration of its securities with the SEC as required by the
Securities Act of 1933 and wants to register its securities in the
state of Illinois.ABC shoe company would most likely register by
coordination
2. Any company may register by qualification whether or not it files
a statement with the SEC.
Quick Quiz 2.C
1. Which of the following securities is(are) exempt from the
registration and advertising filing requirement under the
USA?
I.
Shares of investment companies registered under
the investment company Act of 1940
II.
Shares sold on the Nasdaq stock Market
III.
AAA rated promissory notes of $10000 that mature
in 30days
IV.
Shares sold on the New York Stock Exchange
A. I only
B. II,III and IV
C. II and Iv
D. I,II,III and IV
2. Which of the following securities is NOT exempt from the
registration and advertising requirement of the USA?
A. Shares of Commonwealth Edison, a regulated
public utility holding company
B. Securities issued by the Carnegie Endowment for
peace
C. Securities issued by a bank that is member of the
Federal Reserve System
D. Variable annuity contract issued by Metrodential
Insurance Co.

Quick Quiz 2.D

Indicates an exempt transaction with Y and a nonexempt transaction with N

1. Mr. Thompson, an agent with First Securities , Inc. (a broker dealer), receive
an unsolicited request to purchase a security for Mary Gordon, a high net
worth individual
2. The sale of an unregistered security in a private, nonpublicly advertised
transaction offered to 10 or fewer retail investors over the last 12 months
3. The sale of unclaimed securities by the sheriff of Santa Fe, New Mexico
4. Sale of stock of a privately owned company to the public in an initial public
offering
5. Which of the following are exempt transactions?
I.
An agent sells a security issued by a foreign Government with which
the U.S. has diplomatic relations to an individual client
II.
An unsolicited request from an existing client to purchase a nonexempt
security
III.
The sale of an unregistered security in a private, nonpublicly
advertised transaction advertised to 14noninstitutional investors over
a period not exceeding 12 months
IV.
The sale of unlisted securities by a trustee in bankruptcy
A. I and II
B. I and III
C. II and IV
D. III and IV
Quick Quiz 2.E
With regard to the registration requirement of the Uniform securities Act,
which of the following statements are TRUE?
I.
Only the issuer itself can file a registration statement with the
Administrator.
II.
An application for registration must indicate the amount of securities to
be issued in the state
III.
The Administrator may require registrants to file quarterly reports.
A.
B.
C.
D.

I and II
I and III
II and III
I,II and III

Quick Quiz 3.A

1. A states securities Administrator has jurisdiction over a securities offering if it

A. Was directed to residents of that state

B. Was originated in that state
C. Was accepted in that state
D. Any of the above
2. An Administrator has jurisdiction over an offer to sell securities if it is made in
a newspaper published within no more than
A. 1/3 of its circulation outside the state
B. 1/2 of its circulation outside the state
C. 2/3 of its circulation outside the state
D. 90% of its circulation outside the state
Quick Quiz 3.B
1. With regard to the powers of the Administrator , which of the following
statements are NOT true ?
I.
The Administrator must seek an injunction to issue a cease and
desist order.
II.
The USA requires an Administrator to conduct a full hearing
public or private before issuing a cease and desist order.
III.
The USA grants the Administrator the power to issue injunction
to force compliance with the provisions of the act
A. I and II
B. I and III
C. II and III
D. I,II and III
2. Although the Administrator has a great power ,the USA does place
some limitations on the office. which of the following statements
regarding those powers are TRUE?
I.
In conducting an investigation, an Administrator can compel the
testimony of witnesses.
II.
Investigation of serious violations must be open to the public.
III.
An Administrator in Illinois may enforce subpoenas from south
Carolina only if the violation originally occurred in Illinois
IV.
An Administrator may deny the registration of a securities
professional who has been convicted of a felony within the past
10 years but must provide , if requested in writing, a hearing
within 15 days.
A. I,II and IV
B. I,III and IV
C. I and IV
D. II and III
Quick Quiz 3.C
1. Which of the following statements relating to termination of registration is
TRUE?

A. A registration, once in effect , may never be voluntarily withdrawn .

B. An Administrator may not cancel a registration of a securities
professional who is declared mentally incompetent
C. An Administrator may revoke the registration of a securities
professional who is declared mentally incompetent
D. An Administrator may cancel the registration of a registrant no longer
in business.
Quick Quiz 3.D
1. Which of the following statements relating to penalties under the
USA is TRUE?
A. Unknowing violation of he USA by an agent is cause for
imprisonment under the criminal liability provisions of the
act
B. If a violation has occurred in the sale of a security the
purchaser of the security may recover the original
purchase price, legal costs, and interest , less any
earnings already received.
C. A seller who notices that a sale was made in violation of
the act may offer a right of rescission to the purchaser ,
the purchaser must accept this right within the earlier of
two years after notice of the violation or tree years after
the sale
D. Any person aggrieved by an order of the Administrator
may request an appeal of the order within 15 days which ,
in effect, functions as a stay of the order during the
appeal period .
2. When making an offer of a new issue that is in an registration to
a prospective client an agent claims that his registration with
the Administrator is proof of his qualifications. Under the USA
A. Claiming his registration is approved by the Administrator
while making an offer of a security undergoing
registration subjects this agent to a civil liability claim
B. Claiming his registration is approved by the Administrator
while making an offer of a security does not subject this
agent to a civil liability claim until the registration
becomes effective
C. Claiming his registration is approved by the Administrator
subjects this agent only to civil liability if a sale results
D. Regardless of whether a sale takes place, an agent
making a misleading statement of this type subject
himself of this to possible civil liability.

Quick Quiz 4.A

Write U for unlawful or prohibited activities and L for lawful activities.
1. An agent guarantees a client that funds invested in mutual funds made up of
government securities can not lose principal.
2. A nondiscretionary customer calls his agent and places a buy order for 1000
shares of any hot internet company. Later in the day, the agent enters an
order for 1000 shares of Global Internet services.
3. An agent receives a call from his clients spouse ,advising him to sell her
husbands securities. Her husband is out of the country and requested that his
wife call the agent. The agent refuses because the wife does not have trading
authorization, and she complains vigorously to his manager
4. A client writes a letter of complaint to his agent regarding securities that the
agent had recommended . the agent calls the client to apologize and then
disposes of the letter because the client seemed satisfy.
5. A registered agent borrows $10,000 from a credit union that is one of her
best customers.
6. An agent is convinced that internet resources will rise significantly over the
next 3 months. She offers to buy the stock back from her customers at 10%
higher than its current price at any time during the next 3 months.
7. An agent receives an order for the purchase of an obscure foreign security.
The agent informs the client that the commissions and charges on this
purchase will be much higher than those of domestic securities.
8. An agent who works for small broker dealer that employs no securities
analysis assures her clients that she can analyze any publicly traded security
better than any analyst and that she will do it personally for each security
purchased by a client , regardless of the industry.
9. An agent recommends that her client buy 1000 shares of Internet
Consultants, Inc., an unregistered nonexempt security with a bright future.

Quick Quiz 4.B

1. An investment advisory contracts need not includes

A. The fees and their method of computation
B. A statements prohibiting assignment of clients accounts without client
consent
C. The states in which the adviser is licensed to conduct business
D. Notification requirement upon change in membership, if an investment
partnership.
True or False?
2. An Administrator may not prevent custody of securities or funds if an adviser
notify the Administrator before taking custody.
3. An Administrator may not sell securities to its customers from its own
proprietary account.
4. Under USA antifraud provisions , an investments adviser is bound by the
restrictions that apply to sales practices when engaged in sales activities.

Quick Quiz 4.C

The BJS Advisory Service maintains no custody of customers funds or securities ,
requires no substantial prepayments of fees , and does not have investment
discretion over clients accounts. Which of the following would have to be promptly
disclosed to clients?
I.
II.
III.

The SEC has entered an order barring the executive vice president of
the firm from association with any firm in the investments business.
BJS has just been fined $3500 by the NYSE
A civil suit has just been filed against BJS by one of its clients alleging
that BJS made unsuitable recommendations.
A.
B.
C.
D.

I and II
I and III
II and III
None of the above

Quick Quiz 4.D

1. Which of the following would NOT be included in the safe harbor provisions of
section 28(e) of the Securities Exchange Act of 1934?
A. Proprietary research
B. Third party research
C. Rent
D. Seminar registration fees
2. When an investment adviser with discretion over a clients account directs
trade executions to a specific broker dealer and uses the commission dollars
generated to acquire software that analyzes technical market trends, it is
known as
A. Hard dollar compensation
B. Indirect compensation
C. Investment discretion
D. Soft dollar compensation