Pass the FINRA Uniform Securities State Law Series-63 Questions and answers with CertsForce

Selections I, II, and III are all disallowed under the NASAA Model Rules. In Selection I, Broker-dealer Anon has made an unauthorized transaction and has also stolen from his client. The stop order indicated that the client’s Amazon.com order should be effected only if the stock dropped to $131 a share or less. Anon jumped the gun and sold it for $133, but only gave the client the specified price of $131 a share. In the scenario described in Selection II, Penny’s intentions might have been good, but an agent is not allowed to refund commissions. Anon is also in violation in Selection III’s scenario. A member of the selling group is expected to make “bona fide” public offerings of the securities allotted him. To purchase some of the securities for itself is prohibited.

The municipal bond issued by the Canadian province of Nova Scotia and the bond issued by Nationwide Insurance Company are both exempt securities under the Uniform Securities Act. Bonds issued by Canadian government entities at both the national and the municipal level and bonds issued by domestic entities in highly regulated industries, as is the case with insurance companies, are exempt. The bond issued by a county in Ireland is not exempt; with the single exception of Canada, only bonds issued by national governments with which the U.S. has diplomatic relations are exempt.

An adviser that sells its shares of TweedleDee Corporation after issuing a report recommending the stock as a “buy” is subject to criminal fraud charges for willfully deceiving its clients.

The adviser who recommends the stock as a buy without disclosing the fact that it owns the stock is engaging in a prohibited activity for non-disclosure, but would be unlikely to face criminal fraud charges.

The Securities Act of 1933 is the Act that requires that all new securities be registered and provides for registration by coordination.

The Administrator can issue an order to cease and desist without providing the party concerned with prior notice. In the cases involving the denial, suspension, or revocation of a license, the Administrator will provide prior notice, along with the opportunity for a hearing, and a written statement of the facts and the legal consequences involved.

If a person has appropriately and truthfully disclosed every material fact on its application for registration, the Administrator has 90 days after the registration becomes effective to commence a proceeding to deny, suspend, or revoke the license. If the Administrator has known about the fact for longer than this, he may not begin a proceeding against that person according to the Uniform Securities Act.

The price at which the security will be offered will not be found in a tombstone advertisement. A tombstone advertisement is not an offer to sell the security and, in any case, it is unlikely that the final offer price will have even been decided on at this point.

Keith would not have to register as an agent since he is a salaried employee of a county in Massachusetts selling county-issued bonds to the public. He is not representing a broker-dealer; he is not receiving a commission on the bonds he sells; and he is selling exempt (government-issued) securities. John receives a commission on his sales, so he is considered to be an agent. Stefan is a sales representative employed by a broker-dealer, which makes him an agent under USA guidelines. Even though Preetham is part-owner of the broker-dealer for which he is effecting transactions, he is acting as an agent in doing so.

Trade confirmations must be received by the customer no later than the settlement date.

The Uniform Securities Act excludes annuity contracts wherein an insurance company promises either to pay a fixed sum, either in a lump amount or through periodic payments, from its definition of a security. Debentures, CDs, and option contracts are all classified as securities under the USA.