S-12 Regulatory Framework and Oversight 2

Question 1

Which of the following is NOT a self-regulatory organization (SRO) in the US securities industry?

Accepted Answer

CFTC

Answer

The CFTC (Commodity Futures Trading Commission) is a federal government agency, not an SRO.

Question 2

The 'pattern day trader' rule requires a minimum account equity of:

Accepted Answer

$25,000

Answer

FINRA Rule 4210 requires pattern day traders to maintain at least $25,000 in equity in their margin accounts.

Question 3

Regulation S-P primarily deals with which aspect of broker-dealer compliance?

Accepted Answer

Privacy of consumer financial information

Answer

Regulation S-P requires broker-dealers to adopt privacy policies and safeguard nonpublic personal information of customers.

Question 4

Under FINRA rules, a registered representative who becomes subject to a statutory disqualification is:

Accepted Answer

Subject to enhanced supervision requirements or potential bar from the industry

Answer

A statutory disqualification triggers a FINRA review process that may result in enhanced supervision, a conditional approval, or bar from the industry.

Question 5

What is the maximum period for which a FINRA arbitration award can be appealed to federal court?

Accepted Answer

Varies by state law, generally up to 3 months

Answer

The time limit to vacate a FINRA arbitration award in federal court varies by state law but is generally around 3 months from award delivery.

S-12 Test Practice Test

S-12 Test Practice Test

S-12 Regulatory Framework and Oversight 2