Which of the following is true regarding the Investment Advisor''s Act of 1940 as it pertains to anti-fraud provisions:
Answer(s): B
If a company is exempt from federal registration, it still is subject to the anti-fraud provisions - no matter what the exemption - anti-fraud rules apply to all investment advisor at either the state or federal level
Titanic Securities has worked out its registration issues in the state of Oregon and is now properly registered in that state. However, the administrator in Oregon wishes to revoke Titanic's registration due to new findings of securities fraud. Once Titanic has been notified of the action and sends a written request for a hearing, when is the company allowed a hearing?
Answer(s): C
Titanic has the right to a hearing within 15 days of a written request. The administrator may cancel a registration without a hearing if the registrant is deceased, judged incompetent or cannot be located
The minimum cooling-off period from registration of a federal security to its effective date is:
The minimum statutory cooling-off period is 20 days for federal registration; it is 10 days for state registration
MostValue Funds has an agreement with Pineapple Brokers in Hawaii: Pineapple provides research to MostValue and MostValue agrees to execute trades with Pineapple. This compensation is known as:
This compensation arrangement is a legal exchange known as soft dollars
Are investment advisors allowed custody of client funds?
Answer(s): A
If an investment advisor has possession of client funds or securities, or has intention of such possession, the firm must contact the state administrator to secure approval. The administrator has the authority to permit or disallow the custody
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