Series63 PDF Dumps Real 2023 Recently Updated Questions [Q101-Q119]

Q101. Which of the following are examples of the prohibited practice of manipulation in the securities markets?
I. Broker-Dealer Joker is unhappy with its investment in the stock of a speculative firm and engages another broker-dealer to purchase a large number of shares from it, with the unofficial agreement to buy back those shares, offer more shares which the second broker-dealer will purchase, and so on.
II. Broker-Dealer Joker has a large short position in the stock of a certain corporation. Joker offers a bonus to its agents who effect sale transactions in the stock.
III. A client calls Broker-Dealer Joker with a request to purchase 20 bonds issued by Massachusetts Institute of Technology (MIT.) The bonds are currently selling for their par value of $1,000. Knowing this, Joker offers to sells the client the bonds for $120 per $100 of par, or $1,200 per $1,000 bond.

I, II, and III

I and II only

I and III only

I only

Q102. Which of the following would not be a prohibited activity for a broker-dealer?
I. A broker-dealer tells a client that a municipal revenue bond offered by the city of Boston, Massachusetts is almost risk-free because it is backed by the taxes paid to the city, and the city generates a lot of tax dollars.
II. A broker-dealer sells a client some bonds that the broker-dealer has in its portfolio, after informing the client that it is acting as a seller in the transaction.
III. A broker-dealer purchases some stock that a client is selling for its own portfolio, after informing the client that it is acting as a buyer in the transaction.
IV. A broker-dealer purchases 1,000 shares of Southwest Airlines for a client who calls and asks the broker-dealer to buy some shares of a domestic airline stock at a good price for him and receives written discretionary authority from the client two days later, prior to the settlement date.

I only

II and III only

I and IV only

II, III and IV only

Q103. Ari Gaunt is a registered agent employed by Small &Associates Broker-Dealers. He has been notified of a
hearing regarding the revocation of his license for making unauthorized trades on some of his clients’
accounts. Which of the following statements is necessarily true?

If Ari is found guilty and has his license revoked, Small & Associates will have its license revoked as
well and must reapply for reinstatement by filling out an application and paying the requisite filing fees.

If Ari is found guilty and has his license revoked, Small & Associates will be subject to a fine.

If Ari is found guilty and has his license revoked, he can appeal the decision in a court of law if he files
the appeal within sixty days.

The Administrator of the state can assess Ari with both civil and criminal penalties.

Q104. Which of the following would be considered an “issuer” transaction?

Jacob calls his broker and places an order to purchase 100 shares of Hasbro, Inc. on the open market.

Maria purchases 500 shares of Dodge and Cox’s International Fund, a mutual fund investing in foreign
securities.

Kim sells an AT&T bond she holds that still has three years remaining to maturity.

None of the above is an “issuer” transaction.

Q105. Which of the following describes a prohibited practice in the sale of shares of investment companies?
I. Sandy Slacker hands her client the fund’s prospectus and tells him that the prospectus will provide him all that he needs to know about loads and fees associated with the fund.
II. Elliot Eager tells a client who has an investment objective that includes current income that a certain bond fund has a current yield of 8% and provides the client with a prospectus so that the client can peruse the average annual returns that the fund has generated in past years when the client has the time.
III. After explaining all the fees and loads involved in two different bond funds as well as the difference between current yield and total return, Patty shows the client the data on the average annual returns that the two bond funds provided. She explains to the client that the municipal bond fund has a lower yield than the similar-risk corporate bond fund because the interest income the client will receive from the municipal bond fund will be free from federal taxation, while the interest income on the corporate bond fund is fully taxable.

All the choices describe prohibited practices in the sale of shares of investment companies.

I only

I and II only

I and III only

Q106. Finn Nance has recently passed his CFP exam and is now a certified financial planner. He has new business cards printed that have the words “Certified Financial Planner” printed under his picture. In doing so,

Finn has not violated any laws or engaged in any prohibited practices.

Finn has violated a securities law. The Uniform Securities Act prohibits anyone from using the word
“certified” on any advertisement for services.

Finn has possibly violated a state securities regulation. The Administrator in many states prohibits the use of the word “certified” on any advertisement for services.

Finn is not in violation of any laws as long as he has notified the state Administrator of his new designation and his new logo.

Q107. 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.

Q108. Under NASAA Model Rules, it is permissible for the registered representative of a broker-dealer to split his or her commission with
I. a client.
II. the broker-dealer with which the registered representative is affiliated.
III. another registered representative working for the same broker-dealer.
IV. the administrative assistant who directs calls to the registered representative and provides other services for the agent.

I, II, III, and IV

I, II, and III only

II, III, and IV only

II and III only

Q109. 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, and III

I and II only

II and III only

II only

Q110. Although an Administrator has broad powers, he or she cannot:

issue subpoenas involving compulsory attendance.

gather evidence.

deliver a judicial injunction.

formulate rules and orders.

Q111. Jack Bean is employed by Giant Investment Advisers, LLC. His job duties include advising clients on the
asset allocations of their portfolios. Jack Bean is

an investment adviser representative.

an investment adviser.

an administrative assistant.

an agent.

Q112. Sam Shyster had his day in court-and lost. His license to do business as an investment adviser in the state has been revoked. What legitimate options does Sam have available to him now?

Sam can move to another state and apply for registration as an investment adviser there.

Sam has 45 days in which to file an appeal with the attorney general.

Sam can register with the SEC as an investment adviser, which will exempt him from state registration requirements.

Sam has 60 days to file an appeal of the decision in a court of law.

Q113. The Administrator may require a firm to supply it with any prospectus, pamphlet, advertisement, or other
sales literature intended for prospective investors unless the security
I. will be sold only through an investment advisory firm.
II. is a federal covered security.
III. is issued by a state credit union.

I, II and III

I only

II only

II and III only

Q114. When selling shares in a closed-end investment company, an agent must inform the client of any
I. commissions
II. underwriting fees
III. miscellaneous offering expenses

I, II and III

I only

I and II only

I and III only

Q115. Fly-By-Night Investment Advisers has closed its doors. Which of the following statements is true?

Fly-By-Night is required to shred all documentation of client transactions and communications.

Fly-By-Night must send all records of client transactions and communications to the state Administrator
for safekeeping.

Fly-By-Night must preserve and maintain all records, including client transactions and communications,
advertising materials, and financial statements of the now-defunct business for five years.

Fly-By-Night must send each of its former clients its records of all that client’s transactions and
communications with the firm over the past five years.

Q116. Which of the following would fall under the definition of “agent,” as defined by the Uniform Securities Act
(USA)?

Joe works as an administrative assistant for broker-dealer GetErDone, doing data entry, filing client
forms that contain confidential information, and directing calls to registered representatives of the firm.

Freedom broker-dealers executes the purchase and sale of securities for its customers.

TrustUs Bank has a subsidiary operation that sells mutual funds to the public.

None of the above would fall under the definition of “agent,” as defined by the Uniform Securities Act
(USA.)

Q117. When a client has purchased securities on margin, the broker-dealer

may require that the client leave all his securities, even those not purchased on margin, in street name.

must keep the securities that the client paid cash for separate from the securities that the client
purchased on margin.

may use any securities that the client purchased on margin as collateral for a loan from a bank upon
receiving a written agreement signed by the client.

Both B and C are correct statements.

Q118. Once a broker-dealer has applied for and been granted state registration, the registration remains valid

until December 31st.

for twelve months.

for three years.

for five years.

Q119. Mr. Noah Scruples is a registered representative with CanDo Broker-Dealers. A client calls and wants
Noah to purchase shares of a mutual fund the client has read about. CanDo is not authorized by this
particular fund to effect purchases or sales of the fund shares. Can Noah execute the order anyway?

No. This would be considered money laundering, which is highly illegal.

No. This is a prohibited practice known as selling away.

No. This is a prohibited practice known as front running.

Yes. Since this is an unsolicited trade, Noah can execute the transaction on behalf of his client.