FINRA SIE — Fundamentos de la Industria de Valores — Todas las Preguntas

A dealer sells 50 corporate bonds from its inventory to a retail customer. On the same day, it bought 100 of the same bonds in an offsetting trade. What must the customer's confirmation show?

• a.The dealer's mark-up as a total dollar amount and as a percentage of the prevailing market price✓
• b.Only the net price, because the dealer acted as principal and no markup disclosure is required then
• c.The dealer's mark-up only if the customer asks for it in writing within thirty days of the trade date
• d.The dealer's mark-up as a percentage only, with no dollar amount, shown on the customer's confirmation

FINRA Rule 2232(c) requires a confirmation to include the mark-up or mark-down, as a total dollar amount and as a percentage of the prevailing market price, when a member trades as principal in a corporate or agency debt security with a non-institutional customer and has offsetting trades in at least the same size on the same trading day. Neither a customer request nor a net-price confirmation is the test.FINRA Rule 2232(c)

A customer who is travelling asks a member firm to hold her mail for five months, saying only that she finds forwarding it to be a nuisance. Under FINRA Rule 3150, what is the firm's position?

• a.It may hold the mail for any period, provided the customer's written instructions state an end date in its records
• b.It may not hold the mail that long, because convenience is not an acceptable reason beyond three months✓
• c.It may hold the mail for up to a year, provided the firm sends the customer a monthly e-mail summary
• d.It may never hold customer mail, because it must be sent to the address of record

FINRA Rule 3150 lets a member hold mail on the customer's written instructions, but a request that exceeds three consecutive months, including aggregated prior requests, must state an acceptable reason such as a safety or security concern. Convenience does not qualify. The firm must also tell the customer about alternate ways to monitor the account and verify at reasonable intervals that the instructions still apply.FINRA Rule 3150

A longtime customer asks to see her carrying member's financial condition. Under FINRA Rule 2261, what must the member make available to her?

• a.Its tax returns for the past three years
• b.Information on its financial condition as shown in its most recent balance sheet, available for inspection on request✓
• c.Only a letter stating that it meets its net capital requirement
• d.Nothing, because a firm's financial statements are confidential

Rule 2261(a) requires a member to make available for inspection by any bona fide regular customer, on request, the information on its financial condition disclosed in its most recent balance sheet. The member may instead deliver the balance sheet in paper form, or electronically if the customer consents.FINRA Rule 2261(a)

A firm that lets non-institutional customers open accounts online has a margin disclosure obligation under FINRA Rule 2264. What must it do?

• a.Give the statement only to customers who ask for margin
• b.Give the statement within 30 days after the first margin loan
• c.Post the statement on its website, which replaces any individual delivery
• d.Give the statement to each customer before or when the margin account is opened, in a separate document, and post it on its website✓

Rule 2264(a) bars a member from opening a margin account for a non-institutional customer unless, before or at the time of opening, it furnishes the margin disclosure statement individually in a separate document. A member that allows online account opening or trading must also post the statement on its website in a clear and conspicuous way.FINRA Rule 2264(a)

A member firm sends all of its customers' marketable orders to one trading venue, partly because that venue gives the firm other business in return. What does FINRA Rule 5310 say about that practice?

• a.The practice is acceptable if the firm discloses the arrangement in its annual report
• b.The practice is acceptable because routing decisions are made by the venue, not the firm
• c.The practice is acceptable if every customer order is executed within one second
• d.Channeling orders to a third party as reciprocation for business does not relieve the firm of its duty to seek the best market✓

FINRA Rule 5310 requires reasonable diligence to find the best market so that the customer's resulting price is as favorable as possible under prevailing conditions, considering the character of the market, the size and type of the transaction, the number of markets checked, accessibility of the quotation and the order's terms. Sending orders to a third party in reciprocation for service or business does not excuse a failure of that duty.FINRA Rule 5310

A broker-dealer emails the same market-outlook commentary to 40 retail customers over a three-week period. How does FINRA Rule 2210 classify the piece?

• a.Correspondence, because each recipient is an existing customer of the firm that sent the piece
• b.An institutional communication, because the firm sent it to the recipients electronically
• c.Correspondence, because it was distributed to the recipients over less than 30 calendar days
• d.A retail communication, because it reaches more than 25 retail investors within 30 calendar days✓

Under FINRA Rule 2210, written material made available to 25 or fewer retail investors in any 30 calendar-day period is correspondence, while material reaching more than 25 retail investors in that window is a retail communication and carries the stricter principal-approval and content standards. Being an existing customer does not make a recipient institutional, and the delivery method does not change the count.FINRA Rule 2210(a)

A registered representative wants to buy stock in a publicly traded company purely as a passive investment, with no role in the company. What does FINRA Rule 3270 require for this purchase?

• a.Prior written approval from FINRA before the purchase is made
• b.Prior written notice to the firm, because any compensation from outside the firm must be reported
• c.No outside-business-activity notice, because passive investments are exempt from the rule✓
• d.A signed customer disclosure form listing the representative's holdings in the company

FINRA Rule 3270 requires a registered person to give the member prior written notice of outside business activities in which he or she is an employee, officer, director, partner or other compensated participant. Passive investments are expressly exempted. The rule requires notice to the firm, not FINRA approval, and any private securities transaction is handled under Rule 3280 instead.FINRA Rule 3270

A company's initial public offering is made by an issuer that has never been required to file Exchange Act reports. When must the broker-dealers deliver a preliminary prospectus to a person expected to receive a confirmation of sale?

• a.At least 24 hours before the confirmation is sent
• b.At least 48 hours before the confirmation is sent✓
• c.At least 10 days before the offering becomes effective
• d.At or before settlement, together with the confirmation

SEC Rule 15c2-8(b) requires a broker-dealer participating in the distribution of an issue by an issuer not previously required to file Exchange Act reports to deliver a copy of the preliminary prospectus to anyone expected to receive a confirmation at least 48 hours before the confirmation is sent.17 CFR 240.15c2-8(b)

Which of Regulation Best Interest's four component obligations requires a broker-dealer to understand the risks, rewards and costs of a recommendation and to have a reasonable basis to believe it is in the retail customer's best interest?

• a.The Disclosure Obligation
• b.The Care Obligation✓
• c.The Compliance Obligation
• d.The Conflict of Interest Obligation

Regulation Best Interest has four components: disclosure, care, conflict of interest and compliance. The Care Obligation calls for reasonable diligence, care and skill to understand the potential risks, rewards and costs, to believe the recommendation suits the particular customer's investment profile without placing the firm's interest ahead of the customer's, and to avoid a series of excessive transactions. The Disclosure Obligation covers written disclosure of material facts about the relationship.SEC Regulation Best Interest, 17 CFR 240.15l-1(a)(2)(ii)

A member firm approves a registered representative's participation, for selling compensation, in a private securities transaction. How must the firm treat the transaction?

• a.Leave it off the firm's books, because it was arranged outside the firm's regular business and was the representative's own
• b.Treat it as a passive investment of the representative that needs no review or supervision by the firm
• c.Record it on the firm's books and records and supervise it as if the firm itself had executed it✓
• d.Report it to the representative's customers only if the offering later loses value

Under FINRA Rule 3280, when a member approves participation in a private securities transaction for which the associated person may receive selling compensation, the transaction is recorded on the member's books and records and supervised as though it were executed on the member's behalf. If the member disapproves, the person may not take part in any way, directly or indirectly.FINRA Rule 3280(c)

A member firm wants to pay a finder's fee to a consultant who steers wealthy clients to the firm. The consultant is not registered as a broker-dealer but, because of the activity, would be required to be. What does FINRA Rule 2040 say?

• a.The firm may pay him if the fee is disclosed to each client in writing before any referral
• b.The firm may pay him up to 10% of the commissions the clients generate for the firm
• c.The firm may pay him if its principal approves the arrangement in advance and keeps a record
• d.The firm may not pay him, directly or indirectly, any compensation for those activities✓

FINRA Rule 2040(a) bars a member from paying, directly or indirectly, any compensation, fees, concessions, discounts, commissions or other allowances to a person that is not registered as a broker-dealer but must be because of the activities for which it is being paid. Disclosure or approval does not cure that.FINRA Rule 2040(a)

Under Regulation Best Interest, which type of recommendation falls within the rule's scope?

• a.A recommendation to a natural person who will use it primarily for personal, family or household purposes✓
• b.A recommendation to a corporation for use in its treasury operations
• c.A recommendation to a registered investment company about its portfolio
• d.An unsolicited order placed by a customer without any recommendation

Regulation Best Interest applies when a broker-dealer or its associated person recommends a securities transaction or investment strategy to a retail customer, defined as a natural person who uses the recommendation primarily for personal, family or household purposes. Corporate treasury use falls outside that definition, and an unsolicited order involves no recommendation to trigger the rule.SEC Regulation Best Interest, 17 CFR 240.15l-1

A member firm is controlled by the issuer of a stock, and a customer asks it to buy that stock. When must the member tell the customer about the control relationship under FINRA Rule 2262?

• a.Only if the customer asks about the firm's ownership
• b.Within 30 days after the trade, in the quarterly statement
• c.Before entering into the contract for the purchase, and if that disclosure is oral it must be confirmed in writing at or before completion of the transaction✓
• d.Only when the firm acts as principal for its own account

Rule 2262 requires a member that controls, is controlled by, or is under common control with an issuer to disclose that control to the customer before entering into any contract to buy or sell that issuer's security, and to supplement an oral disclosure in writing at or before completion of the transaction.FINRA Rule 2262

A member firm wants to borrow a customer's fully paid securities. Which written disclosure must the firm give the customer first under FINRA Rule 4330?

• a.A notice that the loan is fully insured by the Securities Investor Protection Corporation up to $500,000
• b.A notice that the customer keeps voting rights and dividend rights on the loaned shares
• c.A clear and prominent notice that SIPA may not protect the customer on the loan, and that the collateral may be the only source of satisfaction if the firm cannot return the securities✓
• d.A notice that the firm may report the loan to the customer's tax adviser at year end

Before first borrowing a customer's fully paid or excess margin securities, FINRA Rule 4330 requires the firm to determine the loans are appropriate for the customer and to give written notice that SIPA may not protect the customer in the loan and the collateral may be the only source of recovery. The customer is also told of risks such as loss of voting rights. SIPC coverage does not automatically extend to the loan.FINRA Rule 4330(b)

A customer asks a broker-dealer to send a wire transfer for $3,500. Which obligation applies to the broker-dealer under the Bank Secrecy Act regulations?

• a.It must obtain and retain the transmittor's name and address, the amount and the execution date, because the transfer is $3,000 or more✓
• b.No record is needed, because wires are reportable only above $10,000
• c.It must file a currency transaction report, because the transfer is over $3,000
• d.It must file a CMIR, because the funds are leaving the firm

31 CFR 1010.410(e) requires nonbank financial institutions, including broker-dealers, to keep specified records on transmittals of funds of $3,000 or more, such as the transmittor's name and address, the amount and the execution date. The CTR threshold of more than $10,000 in currency does not apply to a wire.31 CFR 1010.410(e)