Answers

1. 1. ANSWER: A. Rationale: The Office of Foreign Assets Control maintains and publishes the Specially Designated Nationals List (SDNs list), which is a compilation of names that are suspected or known terrorists. Every covered financial institution must run new customers’ names through this list under the USA PATRIOT Act’s “know your customer” regulations.
2. 2. ANSWER: C. Rationale: Regulation S-P protects investors from potential identity theft by placing strict requirements on how their private information may be used.
3. 3. ANSWER: C. Rationale: A Joint Tenants In Common account provides that the deceased owner’s interests in the account pass to his estate. In a Joint Tenants With Right of Survivorship account, those assets pass to the surviving owner. Tenancy by the entirety is only available to married couples, and usually involves real estate.
4. 4. ANSWER: C. Rationale: Under an UTMA account, assets may be transferred to the minor they have been held for from the age of majority to no later than age 25. The older UGMA accounts required the assets to be transferred at the age of majority, which varies by state.
5. 5. ANSWER: C. Rationale: A sale is judged to be complete when the securities are delivered on the settlement date. A purchase is judged to be complete when the securities are paid for on the settlement date. Payment may occur in cash, debiting the customer’s account, or by reducing the customer’s separately managed account. Payment must be paid in full, or 50% if the security was bought on margin. Purchases and sales will be judged complete before the settlement date if the securities are delivered and paid for before the settlement date.
6. 6. ANSWER: B. Rationale: A power of attorney is the authorization by one party (the “grantor” or “principal”) permitting another party (the “agent” or “attorney-in-fact”) to make legally binding decisions on the grantor’s behalf. The agent has a fiduciary duty t