CSCP Securities Laws & Regulations 2

Question 1

Under the Securities Exchange Act of 1934, which entity is primarily responsible for regulating securities broker-dealers?

Accepted Answer

SEC

Answer

FINRA

Answer

CFTC

Answer

OCC

Question 2

The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 created which new regulatory body?

Accepted Answer

Financial Stability Oversight Council (FSOC)

Answer

FINRA

Answer

OCC

Answer

PCAOB

Question 3

Which SEC rule requires broker-dealers to act in the best interest of retail customers when making investment recommendations?

Accepted Answer

Regulation Best Interest (Reg BI)

Answer

Rule 10b-5

Answer

Rule 144A

Answer

Regulation D

Question 4

A company that fails to file required periodic reports with the SEC may face which consequence under the Exchange Act?

Accepted Answer

Suspension of trading in its securities

Answer

Mandatory liquidation

Answer

Automatic delisting from all exchanges

Answer

Criminal prosecution of all board members

Question 5

Which provision of the Sarbanes-Oxley Act requires CEOs and CFOs to personally certify the accuracy of financial statements?

Accepted Answer

Section 302

Answer

Section 404

Answer

Section 806

Answer

Section 1107

Question 6

Under Regulation S-K, what is the purpose of the Management's Discussion and Analysis (MD&A) section of an SEC filing?

Accepted Answer

To provide management's perspective on financial condition and results of operations

Answer

To list all executive compensation details

Answer

To disclose all pending litigation

Answer

To summarize the auditor's findings

Question 7

The Investment Advisers Act of 1940 imposes a fiduciary duty on registered investment advisers, which means they must:

Accepted Answer

Act in the best interest of clients and disclose all material conflicts

Answer

Maximize client returns regardless of risk

Answer

Charge fees below a regulated maximum

Answer

Obtain FINRA membership