Exam 18: Securities Regulation

A securities professional who engages in the business of buying and selling securities for their own account is a(n):

Some securities are sold under the provisions of Rule 144A. About what fraction of securities offerings have recently been offered subject to this Rule?

Which of the following laws regulates the buying and selling of traded securities?

The detailed arbitration records from disputes involving investment firms or stockbrokers are:

The Investment Company Act of 1940 regulates:

In City of Livonia Employees Retirement System v. Boeing Co., City sued Boeing on behalf of all persons who bought Boeing stock in a certain time period on the basis that the company was overly optimistic about the time schedule for the new 787 aircraft. When problems with the plane developed, the stock fell ten percent. Suit claimed that company executives made false statements about the plane, so committed securities fraud. The appeals court held that Boeing was:

Almost all disputes between registered investment advisers or investment firms and their client investors must be settled by arbitration; there is rarely a chance to go to court to settle the matter.

SEC Rule 10b-5 holds it illegal for anyone involved in securities dealings to:

Section 11 of the 1933 Securities Act imposes civil liability for:

Which of the following are exempt from the Securities Exchange Act of 1933:

Companies that make forecasts that are accompanied by "meaningful cautionary statements identifying important factors that could cause actual results to differ materially from those in the forward-looking statement" are protected from litigation by:

Under the ____, securities suits involving nationally traded securities must be brought exclusively in federal court under federal law.

The term "security" has a legal meaning that includes only stock, bonds and debentures.

Under the securities law, liability for misstatements:

Securities issued by WKSIs are subject to fewer SEC rules than other new offerings.

SEC Rule 10b-5 is used to bring charges of insider trading. This happens about five times a year.

Even if the initial sale of securities is exempt from SEC registration, the securities are never exempt from the securities law.

Insurance policies are exempt from SEC registration and disclosure requirements.

ACAP and Gary Hume were fined and suspended by FINRA for allowing some con artists to keep accounts at their brokerage firm. They contended they should not be punished for actions of con artists. The appeals court held that:

Investment companies are subject to registration and disclosure requirements just like publicly traded securities.