Series 7 Knopman Questions with Correct Answers
allowable times for cold calling Correct Answer-8am - 9pm
can call outside of time period if asked or if you have established
business relationship with client (traded with client in past 18 months)
required information to give person you're cold calling Correct Answer-
name
name of firm
contact info for yourself
purpose of call
-don't have to disclose where you got phone #
2 do not call lists Correct Answer-nationalists
firm specific list
required information when opening new account Correct Answer-name,
address, DOB
SS# (Tax id #)
country of origin
driver's license or passport
occupation & place of employment
who approved new accounts? Correct Answer-general principal/manager
,-need manager's signature
When does CIP obligation have to be fulfilled? Correct Answer-within
reasonable amount of time following opening of account
CIP: customer identification program
what if you work for broker A and want to open up a brokerage account
at broker B? Correct Answer-must have *written consent* from
employer (broker A)
if broker A wants to see copies of business they have to ask (upon
request)
Brad wants to open a new account with Joan, a registered representative
at Firm XYZ. However Brad doesn't want to disclose his investment
profile. Joan: Correct Answer--may open the account but can't solicit
any transactions
FinCEN Correct Answer-financial crimes enforcement network
part of dept of treasury
collects data in financial community
Currency transaction report (CTR) Correct Answer->$10,000 deposits of
cash --> CTR records this
how many days does bank have to file CTR Correct Answer-15 days
,suspicious activity report (SAR) have to be filed within Correct Answer-
30 days
how long are CTRs and SARs kept on record Correct Answer-5 years
what type of bad behavior is this person doing (deposit funds right under
10,000 to avoid filing) Correct Answer-structuring
what does OFAC do? Correct Answer-office of foreign asset control
administer & enforce economic and trade sanctions against targeted
threats to national security
a trade was affected with someone on the specially designated nationals
list - what to do next? Correct Answer-notify compliance/manager
(escalate)
margin account Correct Answer-broker dealer lends money to client to
fund trade
what's required for margin account Correct Answer--risk disclosure
document
-margin agreement (outlines terms & conditions of margin loan)
, what's part of margin agreement Correct Answer--hypothecation
agreement
-credit agreement
-loan consent agreement
hypothecation agreement Correct Answer-allow firm to use securities as
collateral at bank for loan
-consent to pledge your stock
credit agreement Correct Answer-explains to customer the terms and
conditions of margin loan
how much interest to borrow money and how often interest charges
posted to account (usually accrues every day and posts every month)
if firm changes credit agreement how much time do they have to give
you notice Correct Answer-30 days
loan consent agreement Correct Answer-gives firm permission to lend
stock to other customers who want to short it
-this is voluntary**
to open margin account, which of these items is voluntary? Correct
Answer-loan consent agreement
all short selling must be done Correct Answer-with margin account
allowable times for cold calling Correct Answer-8am - 9pm
can call outside of time period if asked or if you have established
business relationship with client (traded with client in past 18 months)
required information to give person you're cold calling Correct Answer-
name
name of firm
contact info for yourself
purpose of call
-don't have to disclose where you got phone #
2 do not call lists Correct Answer-nationalists
firm specific list
required information when opening new account Correct Answer-name,
address, DOB
SS# (Tax id #)
country of origin
driver's license or passport
occupation & place of employment
who approved new accounts? Correct Answer-general principal/manager
,-need manager's signature
When does CIP obligation have to be fulfilled? Correct Answer-within
reasonable amount of time following opening of account
CIP: customer identification program
what if you work for broker A and want to open up a brokerage account
at broker B? Correct Answer-must have *written consent* from
employer (broker A)
if broker A wants to see copies of business they have to ask (upon
request)
Brad wants to open a new account with Joan, a registered representative
at Firm XYZ. However Brad doesn't want to disclose his investment
profile. Joan: Correct Answer--may open the account but can't solicit
any transactions
FinCEN Correct Answer-financial crimes enforcement network
part of dept of treasury
collects data in financial community
Currency transaction report (CTR) Correct Answer->$10,000 deposits of
cash --> CTR records this
how many days does bank have to file CTR Correct Answer-15 days
,suspicious activity report (SAR) have to be filed within Correct Answer-
30 days
how long are CTRs and SARs kept on record Correct Answer-5 years
what type of bad behavior is this person doing (deposit funds right under
10,000 to avoid filing) Correct Answer-structuring
what does OFAC do? Correct Answer-office of foreign asset control
administer & enforce economic and trade sanctions against targeted
threats to national security
a trade was affected with someone on the specially designated nationals
list - what to do next? Correct Answer-notify compliance/manager
(escalate)
margin account Correct Answer-broker dealer lends money to client to
fund trade
what's required for margin account Correct Answer--risk disclosure
document
-margin agreement (outlines terms & conditions of margin loan)
, what's part of margin agreement Correct Answer--hypothecation
agreement
-credit agreement
-loan consent agreement
hypothecation agreement Correct Answer-allow firm to use securities as
collateral at bank for loan
-consent to pledge your stock
credit agreement Correct Answer-explains to customer the terms and
conditions of margin loan
how much interest to borrow money and how often interest charges
posted to account (usually accrues every day and posts every month)
if firm changes credit agreement how much time do they have to give
you notice Correct Answer-30 days
loan consent agreement Correct Answer-gives firm permission to lend
stock to other customers who want to short it
-this is voluntary**
to open margin account, which of these items is voluntary? Correct
Answer-loan consent agreement
all short selling must be done Correct Answer-with margin account
