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8 Cards in this Set
- Front
- Back
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NASD rules
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- uniform practice code
- bylaws - conduct rules - advertising and sales lit - code of procedure - code of arbitration |
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uniform practice code
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- standardizes business transactions
- good delivery - proper signatures - must be in round lots and only 1 odd lot - settlement of trades - regular way, cash, ex-dividend date, accrued interest on bonds |
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bylaws
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- registration - nontransferable
- must terminate from former broker dealer - U5 and get new U4 with new BD - if out of industry or BD for 2 years or more must retest - CE requirements - regulatory element - within 120 days of 2nd anniversary and every 3 years thereafter - firm element - annual reguirement defined by firms traning plan - no grandfathering |
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conduct rules
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- allowed service charges - safekeeping securities
- prohibited practices - dealing with customer - churning, fictitious accounts, abusing discretionary authority, misrepresentation, omitting material information - 5% markup policy - influencing other bd employees - gifts of material value - private securities transactions - employer's permission required - outside affiliations |
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advertising and sales lit
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- advertising - newspaper, tv, radio, billboards
- sales lit - research reports, market letters, circulars, seminars, cold call scripts- copies for 3 years - seminars must be kept for 2 years - group or individual correspondence - if sending to fewer than 25 prospective clients - no prior principal approval required - principal must review either before or after sending to customer |
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code of procedure
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- department of enforcement - reviews trade practice complaints - advises representative or firms in writing
- if conduct rules violation found, may censure or fine (unlimited), suspend (less than 2 years), expel (more than 2 years) or bar (never again), any penalty deemed appropriate - no jail - appeals - go from dept of enforcement to national adjudicatory council to SEC to federal courts - acceptance, waiver, and consent - plead guilty - most common - minor rule violation summary complaint - no formal hearing, waive right to appeal, maximum fine of 2500 |
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code of arbitration
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- settle civil (monetary) disputes - member vs. member, member vs. bank, member vs. transfer agent
- customer must agree to process - no appeals to arbitration |
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NYSE rules
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- registration of RR - 120 day apprenticeship before dealing with public - employer permission required for outside employment
- know your customer rule - accounts for employees of other members - statement of accounts - at least quarterly - holding mail - max 2 mths if US travel and 3 mths if foreign travel |
