FINRA and NASAA launch online testing service for six securities exams

FINRA and the NASAA are now offering Prometric’s ProProctor remote assessment service which allows you to choose where and when you take your security exam. This user-friendly testing platform Continue reading

FINRA and the NASAA are now offering Prometric’s ProProctor remote assessment service  which allows you to choose where and when you take your security exam. This user-friendly testing platform offers self-service capabilities, with live agents available at all times to offer support for candidates if required. 

ProProctor features advanced security measures to ensure the same safety standard is being met comparable to conventional test centers, guaranteeing a consistent and fair testing experience for all candidates. These advanced security measures include multiple ID authentication and facial detection checks, personal security checks, 100% live-monitoring, 360-degree environmental readiness checks, live security agents, proactive protocols such as device checks, as well as record and review functionalities.

Each test candidate is assigned three agents to ensure the exam is administered safely and securely, with a proctor present throughout the entire test.

In order to access Prometric’s ProProctor system, you must install an application on your laptop or desktop and perform a system check. 

It is important to note the following difference with exams at the traditional test center: online tests via ProProctor are forward-moving only. No flagging a question and returning to it. No changing your answer.

The online exams have an onscreen calculator, a virtual scratchpad to capture your notes digitally as well as highlight and strikethrough functionality, which allow you to mark through or bring attention to the portions of the displayed exam question. 

Test-takers and firms may schedule online test appointments for the following six exams: the  SIE, Series 6, Series 7, Series 63, Series 65, and Series 66.

To find out more about this exciting new testing option, go to FINRA’S information page or go to  Prometric’s ProProctor information page.

FINRA delays Online Testing Service

It was previously announced that FINRA and NASAA had been working to introduce an online testing service as an alternative to candidates taking their exam at traditional test centers, to be launched Continue reading

It was previously announced that FINRA and NASAA had been working to introduce an online testing service as an alternative to candidates taking their exam at traditional test centers, to be launched on May 24th.

FINRA has now announced that this service, which is currently in its pilot phase, requires further validation before it can be implemented and therefore will not be launched on May 24th as planned. This also means that there will be a delay in booking appointment times for the five exams that will be included in its initial launch, including the SIE, Series 6, Series 7, Series 63, and Series 66 exams.

FINRA has also updated policies for test candidates, extending enrollment windows that have either expired, or are due to expire between March 16th and June 30th, 2020. This includes all FINRA, NASAA and MSRB exam enrollment dates, with affected enrollment windows being systematically updated in CRD.

Prometric will continue to reopen test centers in accordance with local, state and federal regulations. You can check their Site Openings page, which is continually being updated. You can also read more about the Prometric policies to ensure candidate safety on their Covid-19 Update page.

If your Solomon Exam Prep materials are due to expire before June 1st, contact Customer Service on 503 601 0212 or by email at info@solomonexamprep.com for a complimentary extension until August 1st.

Online testing service to be introduced

It has now been announced that FINRA and NASAA plan to implement a new remote testing service, which will allow exam candidates to take selected exams using a camera-equipped computer. Continue reading

Due to the COVID-19 pandemic, on March 17 Prometric closed its testing centers in the US and Canada, with these closures being extended until May 31st. It has now been announced that FINRA and NASAA plan to implement a new remote testing service, which will allow exam candidates to take selected exams using a camera-equipped computer. Exam testing will continue to be administered by Prometric, with their staff supervising the exams via video and online monitoring tools.

While this remote testing service is currently in its trial phase, FINRA plans to launch the service “in the near future” for selected exams, including the SIE, Series 6, Series 7, Series 63 and Series 66. It is expected that further exams will be included in the weeks following the launch of this innovative service.

Details will be available on FINRA’s COVID-19 information page from May 1st.  

Prometric also announced that it plans to resume testing at certain test centers on May 1st, with limited capacity to maintain safe social distancing protocols. Further information will be updated on the Prometric Coronavirus Update page.

Solomon Exam Prep is offering complimentary extensions for students who have Solomon study materials expiring before June 1st. Contact Customer Service at info@solomonexamprep.com or phone us on 503 601 0212 to have your Solomon study materials extended until August 1st.

Notice Filing vs. State Registration

Notice filing is a topic that often confuses people studying for the Series 63 Uniform Securities Agent State Law exam or the Series 65 Uniform Continue reading

Notice filing is a topic that often confuses people studying for the Series 63 Uniform Securities Agent State Law exam or the Series 65 Uniform Investment Adviser Law exam or the Series 66 Uniform Combined State Law exam. Some mistakenly assume that notice filing is the same as state registration. While there are some similarities, notice filing and state registration are different and the Series 63, Series 65 and Series 66 exams require that you understand the distinction.

So what is notice filing, and how does it work?

To understand the concept of a notice filing, it’s important to know a bit about the entities to which it applies: federal covered advisers and federal covered securities. First, let’s look at federal covered advisers. A federal covered adviser is an SEC-registered adviser that offers investment advice in exchange for compensation. Any adviser with assets under management of $110 million must register as a federal covered adviser.

When it comes to registration, advisers are not subject to double registration, meaning that an investment adviser registered with the SEC does not need to register with any state, and an adviser that is required to register with a state does not register with the SEC. For federal covered advisers, this makes life easier because a federal covered adviser only needs to go through the rigorous registration process one time. Instead of registering in a state, on Form ADV that it files with the SEC, a federal covered adviser lists any states in which it will either have an office or more than five retail clients in a twelve-month period. The SEC then gives notice to the administrator in any state noted on the adviser’s form ADV that the adviser intends to do business in that state. This is a notice filing: a simple heads-up to the state administrator that the advisor will be doing business in its state. Depending on the requirements of the given state, the adviser may be asked to file additional paperwork and pay a fee before offering advice to clients in the state. But, happy day, the adviser gets to skip the state registration process.

Now let’s discuss notice filing for federal covered securities. What is a federal covered security? Well, many of the securities that the average investor is likely to own are federal covered securities. For example, any security traded on an exchange like the NYSE or NASDAQ is a federal covered security. Additionally, securities issued by investment companies that are registered under the Investment Company Act of 1940, such as mutual funds and closed-end funds, are federal covered securities. A federal covered security must be registered with the SEC, but the issuing company is not required to register it with any state. Instead, the issuer must note on its registration statement any state in which it intends to sell the security. The SEC then notifies the administrator of each noted state of the issuer’s intention to sell in that state. Sound familiar? It should because this is also a notice filing: a simple shout-out by the SEC to the state administrator that the security will be sold in its state. Typically the issuer is then required to submit its SEC registration documents to the administrator and pay a filing fee, but, and this is a biggie, the issuer does not need to go through the demanding state registration process in order to sell its securities in the state.

So it’s actually pretty simple. A federal covered security or adviser is registered once with the big boys at the SEC. After that, it’s all smooth sailing. No need for further registration, just a simple notice given to states in which the security will be sold or the adviser will offer investment advice.

Now that you’ve learned the difference between notice filing and state registration, let’s do a practice question to get you ready for the Series 63, Series 65 or Series 66 exam:

**

Spencer Investments is a federal covered investment adviser doing business in Oregon. The Administrator in Oregon requires a notice filing. Does this mean Spencer Investments must register in Oregon as well as with the SEC?

A. No. What it means is that Spencer needs to request that the SEC send the Oregon Administrator a copy of Spencer’s Form ADV, and Spencer needs to pay a notice filing fee to the Oregon Administrator.
B. Yes. Spencer does business in Oregon, so it must register in Oregon.
C. Spencer Investments does not have to register in Oregon but does need to fill out and file all the paperwork for registration so the Oregon Administrator is on “notice” regarding Spencer’s business in Oregon.
D. Yes. The Oregon requirements for registration may be more stringent than the SEC’s, so Spencer must comply with them to do business in Oregon.

Correct Answer: A.
No. What it means is that Spencer needs to request that the SEC send the Oregon Administrator a copy of Spencer’s Form ADV, and Spencer needs to pay Oregon a notice filing fee. A notice filing for an investment advisor is not a registration but means the registration papers Spencer Investments filed with the SEC are shared with the Oregon Administrator, and the Oregon Administrator receives a filing fee.

Tax Changes and Securities Licensing Exams

If you’re studying for a FINRA, NASAA or MSRB securities licensing exam such as the Series 6, Series 7, Series 65, Series 66, Series 50, Series 52, Series 79, Series 82 or Series 99, and you’re wondering how the sweeping tax overhaul might affect your exam and your studying, have no fear, the Solomon Exam Prep team is hard at work figuring out what the changes might mean for securities exam-takers. Continue reading

If you’re studying for a FINRA, NASAA or MSRB securities licensing exam such as the Series 6, Series 7, Series 65, Series 66, Series 50, Series 52, Series 79, Series 82 or Series 99, and you’re wondering how the sweeping tax overhaul might affect your exam and your studying, have no fear, the Solomon Exam Prep team is hard at work figuring out what the changes might mean for securities exam-takers. Regulators and exam committees have yet to weigh in, so what follows is just a first pass at the tax reform law that might be of particular interest to Solomon securities exam-takers:

Investment management fees

The new tax law eliminated a bunch of deductions that had been grouped together as “miscellaneous itemized deductions.” This includes deductions for unreimbursed employee expenses, union dues, legal expenses, and tax preparation, all of which are now gone. The biggest loss for investment advisers is that customers may no longer deduct their fees.

The loss of these deductions only applies to individuals. Businesses (including sole proprietorships) will still be able to deduct fees for investment advice. Individuals would have been less likely to use the deduction anyway, since the increase in the standard deduction makes itemizing less attractive.

The pass-through deduction

There is a new 20% deduction for people who get their income through a “pass-through entity” like a partnership, LLC, or S corporation. But not all pass-through income gets the deduction. This is one of the more complex provisions in the new law. A major limitation is that the deduction begins phasing out after $157,500 for certain “service trades or businesses,” defined as “any trade or business where the principal asset of such trade or business is the reputation or skill of 1 or more of its employees or owners.” Financial and brokerage services are specifically named as among the businesses in this category.

Benefits to REITs

REITs are pass-through entities, and income from REIT dividends gets the pass-through deduction, while avoiding the cap for income from service trades or businesses. The portion of a REIT’s dividends that comes from capital gains on the REIT’s property is specifically excluded from the new deduction. However, as a capital gain this portion is taxed at a lower rate to begin with.

REITs were also given the ability to opt out of a provision of the new law that could have hindered them. Most businesses must now accept a cap on the amount they can deduct for interest on their debt. A REIT can choose not to be subject to this limitation, if it also agrees to deduct depreciation on its real estate at a slower rate.

Advance refundings no longer tax-exempt

Under the new law, bonds issued for the purpose of “advance refunding” are never tax-exempt, not even for government bonds. Advance refunding is when the bond issuer wants to take advantage of lower interest rates by selling new bonds to pay off old bonds. If the old bonds are more than 90 days from maturity, this practice is considered advance refunding and the new bonds lose their tax-exempt status.

New income tax brackets for estates and trusts

The new law doubles the threshold before the estate tax kicks in, from $5.6 million to $11.2 million.

Estates and trusts also got lower tax rates and new tax brackets along with other types of taxpayers, as follows:

Old New
Income Rate
Up to $1,500 15%
$1,501 – $3,500 28%
$3,501 – $5,500 31%
$5,501 – $7,500 36%
$7,501 + 39.6%
Income Rate
Up to $2,550 10%
$2,551 – $9,150 24%
$9,151 – $12,500 35%
$12,501 + 37%

 

In addition, disability trusts still get the personal exemption that was eliminated for individuals.

Fewer taxpayers subject to alternative minimum tax

The alternative minimum tax (AMT) is designed to make sure wealthy taxpayers don’t reduce their taxes beyond a certain amount. Under the old law, individual taxpayers had to have an income of $54,300 for singles or $84,500 for married couples before they needed to worry about the AMT. Those amounts were raised to $70,300 for singles and $109,400 for married couples.

The AMT for corporations has been eliminated entirely.

Changes for special savings plans

The bill included several changes to IRAs, 401(k)s, and 529s. For example, converting a traditional IRA into a Roth IRA no longer comes with the option to change your mind and convert back within a limited period of time. People who lose or leave a job with an outstanding 401(k) loan now have longer to pay it back. 529 accounts can now be used for elementary and secondary school expenses, up to a limit of $10,000.

What didn’t make it into the final bill

The final version of the bill passed on December 20th. When you search for information about it, you should pay close attention to when that information was published or posted.

For example, at one point the bill included a proposed FIFO (first-in, first-out) rule, which said that when selling part of your stock in a company you have to sell the oldest shares first. Since the oldest shares have probably gained the most value, you would have owed more capital gains tax, at least in the short term.

However, the FIFO rule was dropped from the final version of the bill. You may have also read about a major reduction in the annual contribution limits for 401(k)s, or a proposal to remove the tax-exempt status of private activity bonds. Neither made it into the final bill.

This process is not over. Although the ink has dried on the legislation itself, the situation is still developing with regard to how the law will actually be applied in practice and how it will affect your licensing exam. Count on Solomon Exam Prep to be there with the most up-to-date information as it relates to FINRA, NASAA and MSRB securities licensing exams.

Announcing the Release of the Solomon Exam Prep Android Mobile App!

With the release of the Solomon Exam Prep app, you have full mobile access to your Solomon study materials with the click of a button. Continue reading

Do you need to take a securities licensing exam?

Do you wish you had more time to study?

With the release of the Solomon Exam Prep Android app, you have full mobile access to your Solomon study materials at the click of a button.

  • Easier and quicker—Just click the Solomon Exam Prep icon on your phone to be taken directly to your account.
  • Access all your materials—The app provides full site functionality and access to your study guide, exam simulator, audiobook, and video lecture.
  • No typing on tiny keyboards—Don’t worry about typing in a web address! Our app will take you right where you need to be.

Move into the future of mobile securities exam prep with the Solomon Exam Prep app!

To download the app, please visit: goo.gl/IkNceh

Solomon Exam Prep has helped thousands of financial professionals pass their FINRA, NASAA, and MSRB licensing exams, including the Series 6, Series 7, Series 24, Series 26, Series 27, Series 28, Series 50, Series 51, Series 52, Series 53, Series 62, Series 63, Series 65, Series 66, Series 79, Series 82, and the Series 99.

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Upcoming Series 63, 65 and 66 Changes

The North American Securities Administrators Association (NASAA) has announced that it will implement updates to the Series 63, Series 65 and Series 66 examinations on July 1, 2016. What has changed? Continue reading

The North American Securities Administrators Association (NASAA) has announced that it will implement updates to the Series 63, Series 65 and Series 66 examinations on July 1, 2016.

The changes are aimed at better aligning the skills and knowledge required by professionals in the securities industry.

The new exam outlines are similar to the current exam outlines, but some significant changes have been made.

What has changed?

Series 63                                                         

  1. The weighting of the exam sections has been modified to put more emphasis on the registration of broker-dealers over investment advisers
  2. Several new topics have been added which reflect an emphasis on communications with customers and cyber-security. Specifically, the following topics have been added or amended:
  • Exceptions for foreign B-Ds
  • B-D supervision of agents
  • Prospectus delivery requirements
  • Types of customer accounts
  • B-D and agent commissions
  • Cyber-security and data protection
  • Outside securities accounts
  • Due diligence for B-Ds
  • Regulation A amendment
  • Regulation D amendment

Series 65                                                         

  1. The weighting of the exam sections has been modified to put slightly more emphasis on the characteristics of investment vehicles and slightly less emphasis on rules and regulations.
  2. Several new topics have been added which expand the types of investment products and add regulations on electronic communications, cyber-security, pay-to-play and anti-money laundering. Specifically, the following topics have been added or amended:
  • Valuation of equity securities
  • Real estate investments
  • Viatical and life settlements
  • Structured products
  • Commodities and precious metals
  • QDROs
  • High frequency trading
  • Regulation A amendment
  • Regulation D amendment
  • Electronic communications and social media
  • B-D and agent commissions
  • Cyber-security and data protection
  • Pay-to-play rule
  • Anti-money laundering
  • Business continuity plans

Series 66                                                         

  1. The passing score has been lowered from 75% to 73%.
  2. The weighting of the exams sections has been modified to put slightly more emphasis on the characteristics of investment vehicles and slightly less emphasis on rules and regulations
  3. Several new topics have been added which expand the types of investment products and add regulations on electronic communications, cyber-security, pay-to-play and anti-money laundering. Specifically, the following topics have been added or amended:
  • Valuation of equity securities
  • Technical analysis
  • Real estate investments
  • Viatical and life settlements
  • Structured products
  • Commodities and precious metals
  • QDROs
  • High frequency trading
  • Regulation A amendment
  • Regulation D amendment
  • Electronic communications and social media
  • B-D and agent commissions
  • Cyber-security and data protection
  • Pay-to-play rule
  • Anti-money laundering

How will this affect my Solomon Exam Prep products?

Solomon Exam Prep will be updating all products offered for the NASAA exams. For those students that currently have materials and are testing after July 1, 2016, we have added an addendum to their Resources folder (located on their student account), that includes all rule changes and updates.

Our Online Exam Simulator has already been adjusted to reflect the new changes, so students will see an option to take full exams structured prior to July 1 or after July 1 – this will allow for any and all students to utilize our products regardless of their anticipated exam date. We are always adding new questions to our database and that will be reflected in the Online Exam Simulator.

In the coming weeks we will also be releasing a new/ updated digital Study Guide that will reflect the upcoming changes. Any current students will have the option of having their digital Study Guide changed to the new edition at that time, or they can continue to study with our current edition and the supplied addendum.

If you have any questions about the changes or our materials, please do not hesitate to call our office at 503.601.0212 or email info@solomonexamprep.com.

Fiduciary Standard Coming for Broker-Dealers

The Securities and Exchange Commission announced last week that next April it plans to introduce a fiduciary standard for broker-dealers. Since last month when the Department of Labor issued its fiduciary rule for tax-advantaged retirement accounts, the securities industry has been waiting to see if the SEC would join the Department of Labor in a push to raise the legal and ethical standards for broker-dealers and agents. Continue reading

Decorative Scales Of Justice In The LibraryThe Securities and Exchange Commission announced last week that next April it plans to introduce a fiduciary standard for broker-dealers. Since last month when the Department of Labor issued its fiduciary rule for tax-advantaged retirement accounts, the securities industry has been waiting to see if the SEC would join the Department of Labor in a push to raise the legal and ethical standards for broker-dealers and agents.

Currently, broker-dealers and agents are held to the less stringent suitability ethical standard while investment advisors and investment advisor representatives are held to the higher fiduciary standard. The higher standard requires disclosure of all conflicts of interest and ensures the client’s interests come first. While SEC Chair Mary Jo White has said she supports a uniform fiduciary rule, Republicans in Congress have strongly opposed the effort by the Labor Department to expand the fiduciary standard to retirement accounts.  However, many in the securities industry hope that the SEC’s efforts will harmonize with the Department of Labor’s efforts, making compliance more uniform and less complicated.

Changes Coming Soon to Series 63, Series 65 and Series 66 Exams

The North American Securities Administrators Association (NASAA) has announced that it will implement updates to the Series 63, 65 and 66 examinations on July 1, 2016. Continue reading

Newspaper Change Is ComingThe North American Securities Administrators Association (NASAA) has announced that it will implement updates to the Series 63, 65 and 66 examinations on July 1, 2016.

The changes are a result of a review of the exams by NASAA and Prometric and are being put into effect to update and align skills and knowledge required by those in the securities industry.

The weighting of the exams will be modified, as will the number of questions for each topic. The passing score for the Series 63 and 65 will not change, but the Series 66 passing score will be lowered from 75% to 73%.  “Everyone who has to take the Series 66 exam should be happy to hear that,” says Solomon Exam Prep President, Jeremy Solomon, “as well as anyone related to someone who has to take the Series 66 exam.”

New topics will be added to each exam, for example including more on advertising and correspondence. The Series 65 and 66 will include new areas of focus on custody obligations and anti-money laundering. Other topics on the exams will be de-emphasized, while others will be expanded, combined or renamed for the sake of clarity.

Solomon Exam Prep will be making updates and changes to its industry-leading Series 63, Series 65 and Series 66 exam study program to prepare students for the revised exams. Students will receive additional resources with updates as they are made available. Upon publication of the 2nd edition, students may request a free upgrade of their digital guide. Hard copy guides will not be replaced.

For more information, see: http://www.nasaa.org/industry-resources/exams/exam-change-announcement/