Series 66 Exam Prep Episode 4 Laws and Regulations

2.4 Laws, Regulations and Guidelines Including Prohibition on Unethical Business Practices Forty-five questions in every Series 66 examination (45%) will test standards for professional conduct by broker-dealers, broker-dealer agents, investment advisers and Page 12 investment adviser representatives. These forty-five questions will cover the following eight components: (1) Regulation of Investment Advisers, Including State-Registered Advisers and Federal Covered Advisers o Definitions of an investment adviser and federal covered adviser (USA § 401, IAA § 202) o Notice filing requirements o Registration and post-registration requirements (e.g., required books and records, registration maintenance requirements, Form ADV, IAA § 203, IAA § 203A, USA § 201, USA § 202, USA § 203, USA § 204, SEC Rule 203A-1, SEC Rule 203A-2, SEC Rule 204-1, SEC Rule 204-3, NASAA Recordkeeping Requirements for Investment Advisers Model Rule 203(a)-2, NASAA Brochure Rule Requirements for Investment Advisers Model Rule 203(b)-1, NASAA Financial Reporting Requirements for Investment Advisers Model Rule 203(c)-1, NASAA Model Rule for Investment Adviser Written Policies and Procedures Under the Uniform Securities Acts of 1956 and 2002) o Exemptions for exempt reporting advisors and private fund advisors (IAA § 203, SEC Rule 204-4, NASAA Registration Exemption for Investment Advisers to Private Funds Model Rule) o Investment adviser representative supervision (2) Regulation of Investment Adviser Representatives o Definition of an investment adviser representative (USA § 401, SEC Rule 203A-3) o Registration and post-registration requirements (USA § 201, USA § 202, USA § 203, USA § 204, Form U4, NASAA Registration Requirements for Investment Advisers Model Rule 202(a)-1, NASAA Examination Requirements for Investment Advisers and Investment Adviser Representatives Model Rule 204(b)(6)-1) (3) Regulation of Broker-Dealers o Definition of a broker-dealer (USA § 401, IAA § 202) o Definition of an underwriter (SA § 2) o Definition of a market maker, associated person (SEA § 3) o Registration and post-registration requirements (e.g., required books and records, registration maintenance requirements, SEA § 15, SEC Rule 17a-3, SEC Rule 17a-4, SEC Rule 10b-10, USA § 201-A, Form BD) o Broker-dealer agent supervision (4) Regulation of Broker-Dealer Agents o Definition of a broker-dealer agent (USA § 401) o Registration and post-registration requirements (e.g., Form U4) Page 13 (5) Regulation of Securities and Issuers o Definitions of offer, sale, security, federal covered security, person, issuer and non-issuer (e.g., SA § 2, SEA § 3, USA § 401, Howey test) o The securities registration process, including federal and state registration and notice filing requirements, registration exemptions and post-registration requirements (SA § 3, SA § 5, SA § 18, SEC Regulation D, USA § 301, USA § 302, USA § 303, USA § 304, USA § 305, USA § 402) o Definition of accredited investor (SEC Rule 501) o Definitions of investment companies (ICA § 2, ICA § 8) o State antifraud authority (6) Remedies and Administrative Provisions o Authority of state securities administrator (USA § 204, USA § 306, USA § 406, USA § 407, USA § 412) o Administrative actions (USA § 408) o Other penalties and liabilities (USA § 409, USA § 410, USA § 411, USA § 414)