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Series66 (Series66) NASD Series 66 Questions 101–105 (page: 22)

Updated On: 10-Feb-2026

Which of the following is considered a violation of the Antifraud Provision of the Uniform Securities Act?

  1. Jimmy, a researcher at Tyson Brokers, tells a client that it looks like growth will continue over the next year
  2. Paul, an investment advisor representative with TransPlanet Inc talks about the safety of ''AAA'' corporate bonds, even though the bond under consideration has not yet been registered
  3. Ann, an agent with Titanic Securities, does not give a prospectus to a client until after the security has been registered with the SEC
  4. Gloria, a financial advisor with Acme Financial Advisors, states that JohnsJohns Inc has been listed on the NYSE, even though she still has to check into that further.

Answer(s): D

Explanation:

Since Gloria has no knowledge as to whether JohnsJohns has been listed on the NYSE, she is considered to have made a misleading statement and is in violation of the Antifraud Provision of the Uniform Securities Act. Ann is doing the right thing by waiting for the SEC to approve a security before issuing a prospectus. Paul is also within the limits of the law because he is discussing the general safety of 'AAA' bonds. Jimmy, relaying research findings, is also within the law



Julie Divaline, a registered representative with Red Bluff Brokers, has just received a check from her client and is instructed to open a new brokerage account. It is Monday and Julie does not get paid by Red Bluff until Friday. Her rent is due Wednesday so she deposits the client check into her own account, knowing that she will replace the money immediately on Friday when she gets her paycheck. This practice is known as:

  1. Hypothecation
  2. Segregation of funds
  3. Conversion
  4. Commingling client funds

Answer(s): C

Explanation:

Julie has committed a violation known as conversion; she has taken her client's property for her own personal use. This practice is considered fraudulent and unethical under the Uniform Securities Act, in spite of Julie's honest intent to pay the money back immediately



If an financial advisor receives an SEC order to appear in court, how long does the advisor have to file a petition with a U.S. Court of Appeals?

  1. Two weeks
  2. 30 days
  3. 60 days
  4. Six months

Answer(s): C

Explanation:

Anyone subject to an SEC order may challenge the order by filing a petition with a U.S.
Court of Appeals within 60 days of the SEC order



A registered investment advisor is required to disclose fees for services in which of the following documents?

  1. All advertising for the firm
  2. The official statement
  3. Part II of Form ADV
  4. The firm''s prospectus

Answer(s): C

Explanation:

A registered investment advisor is required to disclose pertinent information including fees, types of services provided, types of clients serviced, types of securities offered, etc. This information, as dictated by the Investment Advisor's Act of 1940, must either be documented in a brochure or on Part II of Form ADV. Form ADV is an application and disclosure document that a federal covered advisor must file with the SEC



Bobby Thompson will be in the hospital for a week. He instructs his wife, Linda, to call the broker on his personal account and sell his Lazor Razor stock because the product has malfunctioned and class action lawsuits are soon to follow. The sale needs to take place before the final bell today because the bad news will hit tomorrow. Linda calls Bobby''s broker, who asks to speak with Bobby. Linda explains the story and sells the stock. The story proves true when Lazor Razor stock plummets the following afternoon. Has the agent violated the Uniform Securities Act?

  1. No, Linda is authorized to transact in the account because she is Bobby''s spouse
  2. Yes, the agent needs power of attorney
  3. No, there was a legitimate reason to execute the sale.
  4. Yes, Bobby''s written consent is necessary for this transaction

Answer(s): D

Explanation:

Bobby nees to provide the agent with a signed trading authorization in order for anyone, including a spouse, child or other relative, to transact business within his account. If he were giving the agent discretionary authority for the agent to execute transactions in the account, Bobby would provide that authority with a power of attorney



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