Series 63 exam Questions With Complete

Series 63 exam Questions With Complete Solutions

True or False:

Under the Uniform Securities Act, the city of Atlanta would be included in the definition of the term person. - Correct Answers ✅(T) A client purchased a security per an agent's recommendation, and soon after, it declined by more than 50%. To compensate for the loss, the agent promised the client 1,000 shares in an oversubscribed IPO. In this situation,

the agent has:

• engaged in an unethical business practice as outlined in

NASAA's Statement of Policy on Dishonest and Unethical Business Practices of Broker-Dealers and Agents

• acted properly because he did not guarantee the profit on

the IPO

• made a promise that he will not be able to fill
• acted properly provided the client pays for the IPO in full

prior to resale for a profit - Correct Answers ✅First of all, NASAA's Statement of Policy prohibits the compensation of clients for losses on accounts. 1 / 3

Series 63 exam Questions With Complete Solutions Provided the agent made the recommendation on good investment grounds per the provisions of the Uniform Securities Act, the agent has no liability toward the client.The nature of stocks is to fluctuate in value. Secondly, that same Statement of Policy requires that oversubscribed IPOs be fairly allocated among clients.The actions of this agent would not pass the fairness test. We have no way of knowing if the agent can fulfill this promise, but, in any case, the activity is unethical and by far the better answer choice.(A) Under the Uniform Securities Act, an investment adviser who has custody of client securities or funds must do all of the

following EXCEPT:

• Have client funds and securities examined at least once a

year by an independent public accountant on a surprise basis

• Maintain one or more separate bank accounts where client

funds are deposited and keep customers' securities clearly marked and segregated 2 / 3

Series 63 exam Questions With Complete Solutions

• Send clients itemized statements no less frequently than

every 6 months detailing the funds and securities in the adviser's custody at the end of the period

• Notify the Administrator in writing that the adviser is

maintaining custody - Correct Answers ✅The adviser must send clients quarterly (not semi-annual) itemized statements listing the funds and securities in the adviser's custody at the end of the period and all transactions during the period.The adviser must deposit client funds into one or more bank accounts, not commingled with adviser funds, and notify the clients in writing of where and in what manner the funds are held.The adviser must also arrange for an annual, surprise audit by an independent public accountant of client funds and securities.The adviser must notify the Administrator that the adviser has or may have custody of client securities or funds.(C) In which of the following situations did an agent commit fraud?

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