Chapter 6 Practice Questions

1. 1. Which of the following is a power held by a state securities administrator?
2. A. Sue a registrant for civil damages
3. B. Arrest a registrant accused of criminal activity
4. C. Modify the Uniform Securities Act
5. D. Conduct investigations
6. 2. All of the following are investigative activities conducted by the administrator except:
7. A. Subpoena individuals
8. B. Hold hearings
9. C. Issue search warrants
10. D. Review firm records
11. 3. Which of the following are types of orders issued by an administrator?
12. I. Stop order
13. II. Cease and desist order
14. III. Resume order
15. IV. Criminal order
16. A. I only
17. B. II only
18. C. I and II
19. D. III and IV
20. 4. When a registrant who is subject to a summary order requests a hearing, the hearing must occur within how many days?
21. A. 15 days
22. B. 30 days
23. C. 60 days
24. D. 365 days
25. 5. All of the following are potential penalties for ethical and legal breaches except:
26. A. Rescission
27. B. Revocation
28. C. Fines
29. D. Imprisonment
30. 6. When a civil lawsuit is filed against a securities professional or firm, a guilty party may be liable for which of the following?
31. I. Cost of the security
32. II. Attorney’s fees
33. III. Potential earnings
34. IV. Commissions
35. A. I and II
36. B. I and IV
37. C. I, II, and III
38. D. I, II, III, and IV
39. 7. The statute of limitations on an ethical violation from discovery is:
40. A. 30 days
41. B. 1 year
42. C. 2 years
43. D. 3 years
44. 8. All of the following are possible consequences of a criminal violation of securities laws except:
45. A. Loss of licensure
46. B. $50,000 fine per violation
47. C. Three years in prison per violation
48. D. Civil lawsuits
49. 9. Which of the following are true regarding rescission?
50. I. It is offered by a client
51. II