Series 99 Regulatory Compliance & Reporting 4

Question 1

Under SEC Rule 17a-4(f), electronic records stored by broker-dealers must be stored in a format that is:

Accepted Answer

Non-rewriteable and non-erasable (WORM)

Answer

SEC Rule 17a-4(f) requires that electronic records be stored in a WORM (Write Once Read Many) format to prevent alteration or deletion.

Question 2

A broker-dealer discovers a potential violation of securities law by a customer. Under which regulation is the firm required to file a SAR?

Accepted Answer

FinCEN's SAR regulations under 31 CFR 1023

Answer

FinCEN's SAR regulations at 31 CFR Part 1023 require broker-dealers to file SARs when they detect suspicious activity that may involve money laundering or other financial crimes.

Question 3

Which of the following is the correct sequence for processing a customer complaint under FINRA Rule 4513?

Accepted Answer

Log, investigate, respond, retain for 4 years

Answer

FINRA Rule 4513 requires firms to log customer complaints, investigate them, respond appropriately, and retain records for at least four years.

Question 4

The SEC's Large Trader Reporting Rule (Rule 13h-1) requires large traders to register with the SEC when their transactions equal or exceed:

Accepted Answer

$2 million or 20 million shares during any calendar day

Answer

Rule 13h-1 defines a 'large trader' as one whose transactions equal or exceed $20 million in market value or 2 million shares during any calendar day, or $200 million or 20 million shares during any calendar month.

Question 5

Under Regulation SHO, a broker-dealer's failure-to-deliver position must be closed out within how many days for a threshold security?

Accepted Answer

13 consecutive settlement days

Answer

Regulation SHO Rule 203(b)(3) requires broker-dealers to close out fail-to-deliver positions in threshold securities within 13 consecutive settlement days.

(Series 99) Operations Professional Exam Practice Test

(Series 99) Operations Professional Exam Practice Test

Series 99 Regulatory Compliance & Reporting 4