Practice Test Geeks(CSCP) Certified Securities Compliance Professional Practice Test
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Securities Laws & Regulations Flashcards

7 cards from real CSCP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Securities Laws & Regulations flashcards as text

  1. Under Section 16(b) of the Exchange Act, 'short-swing profits' recovered from corporate insiders are profits earned from purchases and sales within what time period?

    Answer: 6 months

    Section 16(b) requires corporate insiders to disgorge any profits from matching purchases and sales (or sales and purchases) occurring within any 6-month period.

  2. Which regulation governs the offer and sale of securities outside the United States by U.S. issuers without SEC registration?

    Answer: Regulation S

    Regulation S provides a safe harbor for offers and sales of securities occurring outside the United States that are exempt from Section 5 registration requirements.

  3. A company conducting a tender offer must keep the offer open for at least how many business days under Rule 14e-1?

    Answer: 20 business days

    Rule 14e-1 requires that a tender offer remain open for a minimum of 20 business days from the date it is first published or sent to security holders.

  4. Under the Investment Company Act of 1940, a company must register as an investment company if it holds what percentage of its assets in investment securities?

    Answer: More than 40%

    Under Section 3(a)(1)(C) of the Investment Company Act, a company is deemed an investment company if more than 40% of its assets (excluding government securities and cash) are investment securities.

  5. Which SEC rule prohibits broker-dealers from trading ahead of customer orders in the same security?

    Answer: Rule 5320 (Manning Rule)

    FINRA Rule 5320 (the Manning Rule) prohibits broker-dealers from trading a security for their own account at a price that would satisfy a customer's limit order without executing the customer's order first.

  6. The SEC's Whistleblower Program under Dodd-Frank Section 922 awards whistleblowers what percentage of sanctions collected in successful enforcement actions?

    Answer: 10% to 30%

    The SEC's Whistleblower Program awards between 10% and 30% of sanctions collected when the SEC collects over $1 million in a successful enforcement action.

  7. Under Regulation NMS Rule 611 (the Order Protection Rule), trading centers must establish policies to prevent 'trade-throughs.' What is a trade-through?

    Answer: Executing a trade at a price inferior to a protected quotation displayed by another trading center

    A trade-through occurs when a trading center executes a trade at a price that is inferior to a protected best bid or offer displayed by another trading center.