Verified Series63 Dumps Q&As - Series63 Test Engine with Correct Answers [Q99-Q118]

Verifizierte Series63 Dumps Q&As - Series63 Test Engine mit korrekten Antworten [Q99-Q118]

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Verified Series63 Dumps Q&As – Series63 Test Engine with Correct Answers

Pass Your Series63 Dumps as PDF Updated on 2024 With 251 Questions

FRAGE 99
An investment adviser or its representative may

only exercise any discretionary power in the purchase or sale of securities for a client’s account after
receiving written authority prior to the execution of the transactions.

exercise discretionary power in the purchase or sale of securities for a client’s account as long as it
receives written discretionary authority over the account within 10 business days of the first discretionary
transaction placed, assuming oral authority has already been given.

exercise discretionary power in the purchase or sale of securities for a client’s account as long as

exercise discretionary power in the purchase or sale of securities for a client’s account only after

An investment adviser or its representative may exercise discretionary power in the
purchase or sale of securities for a client’s account as long as it receives written discretionary authority
over the account within 10 business days of the first transaction placed, assuming oral authority has
already been given.

FRAGE 100
Which of the following is a security as defined by the Uniform Securities Act (USA)?

a debenture

a futures option contract on wheat

a term life insurance policy

Both A and B are securities as defined by the Uniform Securities Act.

Erläuterung
Both a debenture and a futures option contract on wheat are securities as defined by the USA. A debenture is a long-term, unsecured debt instrument and is specifically listed as a security in the Act. Although commodity futures contracts are not considered to be securities as defined by the Act, options on commodity futures contracts are.

FRAGE 101
It has come to the attention of the Administrator of the state that Samuel Shyster provided false
information on his application to become a registered investment adviser with the state. Prior to revoking
Samuel’s license, the Administrator will provide Samuel with which of the following?
I. prior notice
II. an opportunity to fill out a new registration statement
III. an opportunity for a hearing
IV. a written statement regarding the facts and the legal consequences

I, II, III, and IV

I, II und III

I, III, and IV

I, II, and IV

Prior to revoking Samuel’s license, the Administrator will provide Samuel with prior notice (I),
an opportunity for a hearing (III), and a written statement regarding the facts and the legal consequences
(IV).

FRAGE 102
Which of the following conditions is necessary for an act involving securities fraud to be considered criminal and subject to criminal penalties?

The act extended across state lines.

The perpetrator willfully committed the fraudulent act.

The victim(s) lost a combined total of at least $25,000 because of the act.

The Administrator decides to send the case to criminal court.

Erläuterung
In order for an act of fraud to be considered criminal, the perpetrator must have willfully committed the fraudulent act. In this case, the Administrator will probably ask the court to impose criminal penalties, but an Administrator can’t cause an act of fraud to be criminal by sending it to the criminal court system. If an agent misleads a customer regarding the returns to be expected on an investment but hasn’t deliberately done so, it is still fraud, but not criminal fraud, regardless of how much the victims lost.

FRAGE 103
You are a registered agent with a broker-dealer. One of your clients visits you and wants you to sell some of the U.S. government bonds she owns and purchase shares of a specific aggressive growth mutual fund for her with the proceeds. Your client is a mentally-competent, 84-year-old woman but, based on your other knowledge of her situation, you believe it to be an unwise move. You should

advise her that you don’t believe this is in her best interest, but execute the required transactions if she insists.

call the mutual fund and tell them that they must convince this client that an investment in their fund is not in her best interest, under penalty of law.

nod politely, but not execute the transactions since they are not in her best interest.

turn the matter over to your supervisor.

Erläuterung
If, as a registered agent with a broker-dealer, you receive an order from a client that you don’t believe is in her best interests, you should tell her that, but you must still execute the transactions if she insists. You may not legally ignore her instructions, nor should you bother either the mutual fund or your supervisor with this, given the facts as provided; you should deal with it yourself.

FRAGE 104
To say a security is “exempt,” means that
I. it is exempt from the state’s anti-fraud laws.
II. it is exempt from state registration requirements.
III. any transaction involving it is considered to be an exempt transaction.

I, II und III

Nur I und II

Nur II und III

II only

Erläuterung
To say a security is “exempt” means only that the security is exempt from state registration requirements. It is not exempt from the state’s anti-fraud laws and may or may not be part of an exempt transaction. That is defined by the transaction.

FRAGE 105
No: 192
The maximum monetary civil liability that a person who has violated a securities law can be expected to pay is

the original investment + a state-deemed appropriate interest rate + court costs and reasonable attorneys’ fees + any state-determined “pain and suffering” award.

the original investment + a state-deemed appropriate interest rate + court costs and reasonable attorneys’ fees + any state-determined “pain and suffering” award – any income the victim has received on the investment.

the original investment + a state-deemed appropriate interest rate + court costs and reasonable attorneys’ fees – any income the victim has received on the investment.

the original investment + a state-deemed appropriate interest rate + court costs and reasonable attorneys’ fees + any income the victim has received on the investment.

Erläuterung
The maximum monetary civil liability that a person who has violated a securities law can be expected to pay is the original investment + a state-deemed appropriate interest rate + court costs and reasonable attorneys’ fees – any income the victim has received on the investment. The monetary liability is reduced by any dividends, interest income, or capital gains the investor may have received. Monetary awards for pain and suffering are not considered.

FRAGE 106
In which of the following scenarios would the Administrator of a state not have jurisdiction?
I. A monthly newspaper published by a resident of the state who is not a registered investment adviser
has a column in which the publisher makes specific investment recommendations for clients who write in
for advice. About 80% of the circulation of the publication is to out-of-state residents.
II. An internet blog posted by an out-of-state resident makes investment recommendations.
III. An out-of-state firm solicits buyers for its promissory notes within the state.

Ich habe nur

II only

Nur I und II

I, II und III

The administrator of a state would not have jurisdiction in the scenarios described in
Selections I and II. In Selection I, more than 2/3 of the circulation of the newspaper is outside the state,
which excludes it from the jurisdiction of the Administrator. Selection II describes an electronic
communication that originates from outside the state, which excludes it. Selection III constitutes an offer
to sell securities within the state, and this will always fall under the jurisdiction of the Administrator of the
state.

FRAGE 107
Which of the following statements regarding an open-end investment company is not true?

Its shares are bought and sold through the company.

Its securities are federal covered.

Its shares may sell for either net asset value or greater than net asset value, but not below

Its shares are bought and sold on exchange floors.

Erläuterung
The shares of an open-end investment company are not bought and sold on exchange floors. An open-end investment company is a mutual fund, and its shares are bought and sold through the company. The price per share will be either at net asset value as is the case with a no load fund, or above net asset value, as is the situation with a load fund, when the price is equal to net asset value + the sales charge (load.) Open-end investment company shares are federal covered and, as such, do not need to be registered with the state.

FRAGE 108
S. White and Associates is an investment adviser registered in the state of Kentucky and, as such, is meeting Kentucky’s minimum net capital requirement for investment advisers. The firm recently registered with the state of Virginia and has opened an office there. Virginia has a significantly higher net capital requirement for its investment advisers.
Which of the following statements is true?

According to the Uniform Securities Act, S. White will have to meet Virginia’s higher requirement.

According to the Investment Advisers Act of 1940, S. White needs only to meet the net capital requirement of Kentucky.

According to the Securities Exchange Act of 1934, S. White needs to meet at least the minimum net capital requirement specified by that Act since it is now operating in multiple states.

According to the Investment Advisers Act of 1940, S. White will have to maintain a minimum net capital equal to the average of the net capital requirements of the two states.

Erläuterung
Since S. White is already registered in the state of Kentucky and meeting the net capital requirement of that state, the Investment Advisers Act of 1940 stipulates that Virginia cannot require a higher minimum net capital. The Act states that if an investment adviser is registered in one state and is meeting its net capital requirement, a second state cannot impose a higher net capital requirement on the investment adviser.

FRAGE 109
Skip is a registered agent with state. He recently quit his job with Venus Broker-Dealers to become affiliated with Mars Broker-Dealers.
Which of the three entities must report this change to the state Administrator?

Skip only

Skip and either Mars or Venus, but not both

Both Skip and Venus

Skip, Mars, and Venus

Erläuterung
When Skip leaves one broker-dealer and signs on with another, all three entities-Skip, Mars, and Venus-must report this to the state Administrator. Under the Uniform Securities Act, when an agent leaves a broker-dealer, both the agent and the broker-dealer are required to report this to the state Administrator, and when an agent begins employment with a new broker-dealer, both the agent and the new broker-dealer must report it.

FRAGE 110
BigCash Broker-Dealers is registered in the state and is in the process of purchasing a smaller broker-dealer, Target Investments, as a subsidiary. Target Investments is also registered in the state.
After completing the purchase, what actions must BigCash take regarding registration of its new subsidiary?

BigCash need do nothing since Target Investments was already duly registered with the state as a broker-dealer.

BigCash must file a new application with the state to register its new subsidiary, but will be able to utilize the remainder of any annual filing fees that Target Investments had paid for the year.

BigCash must file a new application with the state to register its new subsidiary and must also pay the annual filing fees required by the Administrator.

BigCash will need to pay the annual filing fees required by the Administrator, but will not need to file a new registration application.

Erläuterung
After completing the purchase, BigCash will have to file a new registration application for its new subsidiary, but BigCash can utilize the remainder of any annual filing fees that Target Investments had paid for the year.
Although registration applications are never transferable, annual filing fees are.

FRAGE 111
Which of the following does not describe a prohibited practice for investment advisers?
I. The adviser sells its non-institutional clients securities that it has issued.
II. The adviser makes a discretionary trade for a client after receiving verbal authorization only and does
not receive written authorization from the client within 10 business days of doing so.
III. The investment adviser requires an advisory fee of $300 to be paid in advance at the beginning of
each quarter.

None of the selections describe prohibited practices.

Ich habe nur

Nur I und III

Nur II und III

Selections II and III do not describe prohibited practices. If an adviser makes a discretionary
trade for a client after having received verbal authorization to do so and does not receive written
authorization from the client within 10 business days of doing so, the adviser is limited to making
recommendations to the client and executing unsolicited trades only, but he has not engaged in a
prohibited practice, and this is the scenario described in Selection II. There is no provision that prohibits
an adviser from requiring an advisory fee to be paid in advance as long as it is reasonable, as described
in Selection III. An adviser is not permitted to sell its non-institutional clients securities it has issued itself
because of the significant conflict of interest involved. The exception is if the client is an institution that is
in the business of lending money, but Selection I specifically indicates “non-institutional clients.”

FRAGE 112
Barring no irregularities (such as a license revocation by another state last year), after you have filed for
registration as an agent, your license will be granted within

10 business days.

14 business days.

30 days.

45 days.

Barring no irregularities, after you have filed for registration as an agent, you should receive
your license within 30 days. More specifically, your license will be approved “no later than noon of the
3 0th day after filing.”

FRAGE 113
Which of the following orders can an Administrator issue without providing prior notice?

license suspension

license revocation

cease and desist

license denial

Erläuterung
The Administrator can issue an order to cease and desist without providing the party concerned with prior notice. In the cases involving the denial, suspension, or revocation of a license, the Administrator will provide prior notice, along with the opportunity for a hearing, and a written statement of the facts and the legal consequences involved.

FRAGE 114
Moe is a registered investment adviser doing business under the name of MoeMoney Investment Advisers, LLC. Larry, Curly, and Mary all hold positions with the firm. Larry is on the board of directors; Mary is a sales representative for the firm; and Curly is an administrative assistant, who performs clerical duties.
Given that Moe is already a registered investment adviser, which of the other three are automatically registered as investment adviser representatives?

Larry only

Larry and Mary only

Larry, Mary and Curly

Mary and Curly only

Erläuterung
As a director of the firm, Larry would automatically be registered as an investment adviser representative of MoeMoney Investment Advisers. Although directors and officers of the firm are automatically registered as investment adviser representatives, Mary, as a salesrepresentative, would have to apply for her own registration. Curly does not need to be registered since he performs only clerical duties.

FRAGE 115
Ms. Connie Fused sent her investment adviser a check, payable to a mutual fund that he had
recommended to her. What must the adviser do in order to avoid being considered the custodian of this
account and, thereby, subject to some strict requirements, including a higher minimum net capital?

He needs to forward the check to the mutual fund within 3 days.

He needs to forward the check to the mutual fund within 24 hours.

He needs to get a written statement from Ms. Fused, addressed to the state Administrator,indicating it
was her mistake.

He needs both to forward the check within 24 hours and to obtain a written statement from Ms. Fused.

As long as the adviser forwards the check to the mutual fund within 24 hours, he will not be
deemed to have taken custody of Ms. Fused funds. This assumes the mutual fund is in no way affiliated
with the investment adviser.

FRAGE 116
Under the guidelines of the Bank Secrecy Act (BSA), the Treasury Department now requires
broker-dealers to obtain and keep certain information relating to clients that make or receive funds
transfers that involve

$3,000 or more.

$10,000 or more.

$5,000 or more.

$100,000 or more.

Under the guidelines of the BSA, the Treasury Department now requires broker-dealers to
obtain and keep information relating to clients that make or receive funds transfers that involve $3,000 or
more. If the transaction is a cash transaction over $10,000, the same rules apply, and a Currency
Transaction Report must be filed with FinCEN. Under the USA Patriot Act, if the broker-dealer thinks that
a transaction of $5,000 or more is suspect, the broker-dealer must file a suspicious activity report (SAR.)

FRAGE 117
A bond issue has recently been registered with the state Administrator.
Which of the following statements are true?

An investor can feel secure in buying the bond because it has recently been registered, which means that the state Administrator finds it to be of sound quality at this point in time.

The bond may now be offered for sale in the state.

The issuer may now offer this bond for sale, and any other bonds that the issuer may want to offer for sale in the future will be able be sold after the issuer executes a notice filing.

Both A and B are true statements.

Erläuterung
When a bond issue has been effectively registered with the state Administrator, it can be offered for sale in the state. The bond’s acceptance by the Administrator simply means that the issuer has supplied enough information in order for an investor to judge the quality of the bond for himself; it in no way implies that the bond is of sound quality. It could, in fact, be a very risky security and still have met the registration requirements.

FRAGE 118
You are an agent with a broker-dealer and have learned of limited partnership interests being sold by a small company that is planning to come out with a product that you think is going to “wow” the market. You would like to get in on the action, but the minimum investment needed is $10,000, and you don’t have that kind of dough lying around. You talk to your brother, who is also one of your clients, and get him interested in investing in the firm, too. The two of you decide to pull your money together, each putting in $5,000, and you agree to split any profits or losses.
Is this permitted?

Yes. This is permitted since the agreement is between you and a family member.

Maybe. But it will require written consent from both your brother and your firm.

Yes, as long as your brother provides your firm with his written consent.

Erläuterung
It may be permissible for you and your brother to open a joint account to invest in this partnership since he is a family member, but it will require the written consent of both your brother and your firm, and your firm is under no obligation to give its consent.

Laden …

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