Podcast
Questions and Answers
What is the primary obligation of a registered person in conducting their business activities?
What is the primary obligation of a registered person in conducting their business activities?
- To act in the best interest of the client only
- To act in the best interest of the broker dealer
- To act in the best interest of the market
- To act honestly, fairly and in the best interest of the client and the integrity of the market (correct)
What should a registered person ensure when advising or acting on behalf of a client?
What should a registered person ensure when advising or acting on behalf of a client?
- That the client is aware of the risks involved in the investment
- That the client is aware of the broker dealer's fees
- That any representations or communications made to the client are accurate and not misleading (correct)
- That the client has a minimum investment amount
What is the primary purpose of SRC Rule 30.2?
What is the primary purpose of SRC Rule 30.2?
- To facilitate customer complaints against broker dealers
- To establish the Ethical Standard Rule for registered persons
- To outline the transactions and responsibilities of broker dealers (correct)
- To regulate the commissions and charges of broker dealers
Which of the following is a requirement for customer account statements?
Which of the following is a requirement for customer account statements?
What is the primary purpose of SRC Rule 52.1.9?
What is the primary purpose of SRC Rule 52.1.9?
What should a broker dealer ensure when providing services to clients?
What should a broker dealer ensure when providing services to clients?
Which of the following is a requirement for transactions and responsibilities of broker dealers?
Which of the following is a requirement for transactions and responsibilities of broker dealers?
What should a registered person ensure when communicating with clients?
What should a registered person ensure when communicating with clients?
What is the primary purpose of SRC Rule 30.2.1?
What is the primary purpose of SRC Rule 30.2.1?
What should a broker dealer ensure when providing services to clients?
What should a broker dealer ensure when providing services to clients?
Study Notes
Ethical Standard Rule (SRC Rule 30.2.1)
- A registered person must act honestly, fairly, and in the best interest of their clients and the integrity of the market.
- Communications with clients must be accurate and not misleading, and must not violate SRC Rule 24.1(d).
- Factors to consider when determining if a communication is misleading include:
- Overall context
- Audience
- Overall clarity
Honesty and Fairness
- A registered person must ensure that representations or communications made to clients are accurate and not misleading.
- They must act in the best interest of their clients and the integrity of the market.
- The overall context in which a statement is made must be considered, as a statement may be misleading in one context but not in another.
Diligence
- A registered person must act with due skill, care, and diligence in the best interests of their clients and the integrity of the market.
- They must:
- Execute client orders promptly and in accordance with client instructions
- Execute client orders on the best available terms in compliance with SRC Rule 30.2.13
- Ensure that transactions are promptly and fairly allocated to client accounts
Other Rules
- SRC Rule 30.2 covers transactions and responsibilities of broker-dealers
- SRC Rule 52.1.8 covers customer account statements
- SRC Rule 30.2.5 covers commissions and charges for services performed by a broker-dealer
- SRC Rule 52.1.9 covers customer complaints
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Description
This quiz covers topics related to the SEC certification webinar for equities securities salesmen, including communication and audience considerations.
