FINRA Uniform Securities Agent State Law 3

Question 1

Under the Uniform Securities Act, which of the following securities is typically exempt from registration requirements?

Accepted Answer

Municipal bonds issued by a city government

Answer

Municipal bonds issued by governmental entities are exempt from state registration requirements under the USA.

Question 2

A broker-dealer registered in State A wishes to conduct business with clients in State B without registering there. Under the USA, this is permissible only if the broker-dealer:

Accepted Answer

Has no more than 5 non-institutional clients in State B in any 12-month period

Answer

The de minimis exemption allows a broker-dealer with no office in a state to conduct business with up to 5 non-institutional clients in that state within a 12-month period without registering.

Question 3

Which statement about an investment adviser's fiduciary duty is CORRECT under the Uniform Securities Act?

Accepted Answer

The adviser must always place the client's interests above its own

Answer

Investment advisers owe a fiduciary duty to all clients, which requires placing the client's interests above the adviser's own interests at all times.

Question 4

An agent who is registered in State X moves to State Y and begins working for a different broker-dealer. Under the USA, the agent must:

Accepted Answer

Register in State Y before conducting securities business there

Answer

Registration is state-specific and employer-specific, so an agent must register in the new state and under the new broker-dealer before conducting business.

Question 5

Under the USA, which of the following would be considered a 'fraudulent' practice in connection with the offer or sale of securities?

Accepted Answer

Omitting a material fact that would likely influence a buyer's decision

Answer

Omitting a material fact in connection with the offer or sale of securities constitutes fraud under the Uniform Securities Act.

(FINRA) FINRA Exams Practice Test

(FINRA) FINRA Exams Practice Test

FINRA Uniform Securities Agent State Law 3