WILEY FINRA SERIES Wiley Series 63 Exam Review 2016 + TEST BANK The Uniform Securities 201 PAGES

(TEST BANK) WILEY SERIES 63 EXAM REVIEW 2016 The Uniform Securities State Law Examination + Test Bank The Securities Institute of America, Inc. By Wiley ISBN 978-1-119-11245-7 (Paperback) ISBN 978-1-119-13886-0 (ePDF) ISBN 978-1-119-13885-3 (ePub) 201 PAGES WILEY SERIES 63 EXAM REVIEW 2016 WILEY FINRA SERIES This series includes the following titles: Wiley Series 3 Exam Review 2016 + Test Bank: National Commodities Futures Examination Wiley Series 4 Exam Review 2016 + Test Bank: The Registered Options Principal Examination Wiley Series 6 Exam Review 2016 + Test Bank: The Investment Company and Variable Contracts Products Representative Examination Wiley Series 7 Exam Review 2016 + Test Bank: The General Securities Representative Examination Wiley Series 9 Exam Review 2016 + Test Bank: The General Securities Sales Supervisor Examination—Option Module Wiley Series 10 Exam Review 2016 + Test Bank: The General Securities Sales Supervisor Examination—General Module Wiley Series 24 Exam Review 2016 + Test Bank: The General Securities Principal Examination Wiley Series 26 Exam Review 2016 + Test Bank: The Investment Company and Variable Contracts Products Principal Examination Wiley Series 55 Exam Review 2016 + Test Bank: The Equity Trader Examination Wiley Series 62 Exam Review 2016 + Test Bank: The Corporate Securities Representative Examination Wiley Series 63 Exam Review 2016 + Test Bank: The Uniform Securities State Law Examination Wiley Series 65 Exam Review 2016 + Test Bank: The Uniform Investment Adviser Law Examination Wiley Series 66 Exam Review 2016 + Test Bank: The Uniform Combined State Law Examination Wiley Series 99 Exam Review 2016 + Test Bank: The Operations Professional Examination For more on this series, visit the website at www.wileysecuritieslicensing.com. WILEY SERIES 63 EXAM REVIEW 2016 The Uniform Securities State Law Examination The Securities Institute of America, Inc. Cover Design: Wiley Cover Image: © iStockphoto.com / LuisB Copyright © 2016 by The Securities Institute of America, Inc. All rights reserved. Published by John Wiley & Sons, Inc., Hoboken, New Jersey. Previous editions published by The Securities Institute of America, Inc. Published simultaneously in Canada. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600, or on the Web at www.copyright.com. 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ISBN 978-1-119-11245-7 (Paperback) ISBN 978-1-119-13886-0 (ePDF) ISBN 978-1-119-13885-3 (ePub) Printed in the United States of America. 10 9 8 7 6 5 4 3 2 1 Contents ABOUT THE SERIES 63 EXAM ix ABOUT THIS BOOK xiii ABOUT THE TEST BANK xv ABOUT THE SECURITIES INSTITUTE OF AMERICA xvii CHAPTER 1 FEDERAL LAW REVIEW 1 The Securities Act of 1933 1 The Prospectus 2 The Final Prospectus 2 Misrepresentations 3 The Securities Exchange Act of 1934 3 Net Capital Requirement 7 Customer Coverage 7 Fidelity Bond 8 The Insider Trading and Securities Fraud Enforcement Act of 1988 8 Firewall 9 The Telephone Consumer Protection Act of 1991 9 National Securities Market Improvement Act of 1996 10 vi Contents The Uniform Securities Act 11 The Uniform Prudent Investors Act of 1994 12 CHAPTER 2 DEFINITIONS OF TERMS 13 Security 13 Person 15 Broker Dealer 16 Pension Consultants 18 Investment Counsel 18 Form ADV 19 Investment Adviser Registration Database (IARD) 20 Investment Adviser Representative 20 Offer/Offer to Sell/Offer to Buy 23 Sale/Sell 23 Guarantee/Guaranteed 23 Contumacy 24 Federally Covered Exemption 24 Power of Attorney 24 Pretest 25 CHAPTER 3 REGISTRATION OF BROKER DEALERS, INVESTMENT ADVISERS, AND AGENTS 31 Registration of Broker Dealers and Agents 31 Agent Registration 32 Registering Broker Dealers 33 Financial Requirements 34 Broker Dealers on the Premises of Other Financial Institutions 34 Registering Agents 35 Canadian Firms and Agents 36 Investment Adviser Registration 37 The National Securities Market Improvement Act of 1996/The Coordination Act 37 Contents vii Investment Adviser Representative 38 Investment Adviser Registration 39 Capital Requirements 39 Exams 40 Advertising and Sales Literature 41 Brochure Delivery 42 Wrap Accounts 43 Pretest 45 CHAPTER 4 SECURITIES REGISTRATION, EXEMPT SECURITIES, AND EXEMPT TRANSACTIONS 49 Exempt Securities 49 Securities Registration 50 Registration of IPOs Through Coordination 50 Registration Through Notice Filing 51 Registration of Non-Established Issuers/Registration Through Qualification 51 Exempt Securities/Federally Covered Exemption 53 Exempt Transactions 54 Pretest 59 CHAPTER 5 PROFESSIONAL CONDUCT AND PROHIBITED AND FRAUDULENT ACTIONS 65 Fraud 65 Professional Conduct 66 Suitability 66 Market Manipulation 68 Customer Complaints 69 The Role of the Investment Adviser 69 Additional Compensation for an Investment Adviser 70 Agency Cross Transactions 70 Disclosures by an Investment Adviser 70 Investment Adviser Contracts 72 Private Investment Companies/Hedge Funds 72 Fulcrum Fees 72 Soft Dollars 73 Borrowing and Lending Money 74 Pretest 75 CHAPTER 6 THE STATE SECURITIES ADMINISTRATOR AND THE UNIFORM SECURITIES ACT 83 Actions by the State Securities Administrator 83 Cancellation of a Registration 84 Withdrawal of a Registration 85 Actions Against an Issuer of Securities 85 Rule Changes 85 Administrative Orders 85 Interpretive Opinions 87 Administrative Records 87 Investigations 88 Civil and Criminal Penalties 88 Jurisdiction of the State Securities Administrator 89 Administrator’s Jurisdiction over Securities Transactions 90 Radio Television and Newspaper Distribution 92 Right of Rescission 93 Statute of Limitations 93 Pretest 95 ANSWER KEYS 101 GLOSSARY OF EXAM TERMS 109 INDEX 175 viii Contents About the Series 63 Exam Congratulations! You are on your way to becoming a registered representative licensed to conduct securities business in all states that require the Series 63. The Series 63 exam will be presented in a 60-question multiple-choice format. Each candidate will have one hour and 15 minutes to complete the exam. A score of 72% or higher is required to pass. The Series 63 is as much a knowledge test as it is a reading test. The writers and instructors at The Securities Institute have developed the Series 63 textbook, exam prep software, and videos to ensure that you have the knowledge required to pass the test and to make sure that you are confident in the application of the knowledge during the exam. IMPORTANT EXAM NOTE The series 63 exam is based on the provisions of the Uniform Securities Act not on any of the amendments enacted by any particular state or state securities administrator. The Uniform Securities Act may be referred to as the USA or as the Act. Test takers should treat these terms as interchangeable. TAKING THE SERIES 63 EXAM The Series 63 exam is presented in multiple-choice format on a touch-screen computer known as the PROCTOR system. No computer skills are required, and candidates will find that the test screen works in the same way as an ordinary ATM. Each test is made up of 60 questions that are randomly chosen from a test bank containing several thousand questions. The test has a time limit of one hour and 15 minutes and is designed to provide enough time x WILEY SERIES 63 Exam Review 2016 for all candidates to complete the exam. Each Series 63 exam will have five additional questions that do not count towards the final score. The Series 63 co...

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