Uniform Securities Act and State Regulations Flashcards
6 cards from real Series 65 – Uniform Investment Adviser Law Exam practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Uniform Securities Act and State Regulations flashcards as text
Under the Uniform Securities Act, what is required of an agent who changes employment from one broker-dealer to another?
Answer: The agent must file a new registration notice through the new broker-dealer and the prior registration must be terminated
When an agent changes firms, a new registration must be filed with the new broker-dealer as sponsor; the agent cannot simply transfer registration, and the prior registration must be properly terminated.
What is 'rescission' as a remedy under the Uniform Securities Act?
Answer: The right of a buyer to return a security and receive a refund, plus interest, when a violation of the Act occurred in the sale
Rescission allows a buyer who was sold a security in violation of the Uniform Securities Act to return the security and recover the purchase price plus interest.
Which of the following is an exempt transaction under the Uniform Securities Act?
Answer: An isolated non-issuer transaction (a private sale between two individuals not involving a dealer)
An isolated non-issuer transaction — a private, one-time sale between individuals not involving an underwriter or dealer — is an exempt transaction under the Uniform Securities Act.
Under the Uniform Securities Act, an agent of a broker-dealer is defined as:
Answer: A natural person who represents a broker-dealer or issuer in effecting securities transactions
An agent is a natural person (individual, not a corporation) who represents a broker-dealer or issuer in buying or selling securities and must be registered in each state where they conduct business.
What is the purpose of a 'surety bond' requirement for investment advisers under state law?
Answer: To provide financial protection for clients if the adviser commits fraud or fails to fulfill obligations
Surety bonds required by states provide a financial guarantee that clients can recover damages if the adviser engages in fraud, misappropriation, or other misconduct.
Which type of order can a state securities administrator issue to immediately stop an alleged violator from continuing harmful activity?
Answer: A cease-and-desist order
A cease-and-desist order directs a person to immediately stop a specific practice or activity that the administrator believes violates securities law.