This sub-section focuses on state registration requirements and post-registration requirements for securities (not to be confused with investment adviser or broker-dealer registration). It covers registering securities at the state level, the ongoing requirements after registration, and the consequences of non-compliance.
Which of the following is NOT a method of state securities registration?
Not Correct
Correct!
Select an option above to see an explanation here.
A) Coordination is a method of registering securities simultaneously with the SEC and state regulators. B) Qualification is a method of registering securities with state regulators that requires a thorough review of the offering. C) Notice Filing is a simplified registration process for securities already registered with the SEC. D) Investment Adviser Registration is registering as an investment adviser, not a method of state securities registration.
What is the primary purpose of Blue Sky Laws?
A) Blue Sky Laws do not regulate the sky or air quality. B) Blue Sky Laws are state laws that regulate the offering and sale of securities to protect investors from fraud. C) Blue Sky Laws focus on securities registration, not investment adviser registration. D) Blue Sky Laws provide a framework for state securities regulation, not federal regulation.
Which of the following is an ongoing post-registration requirement for issuers of securities?
A) Providing financial statements is an ongoing post-registration requirement for issuers to inform investors about their financial condition. B) Registering with the SEC is a federal registration requirement, not a post-registration requirement. C) Registering as an investment adviser is not a post-registration requirement for issuers of securities. D) Registering as a broker-dealer is not a post-registration requirement for issuers of securities.
In the early 1900s, many investors lost their savings due to fraudulent securities offerings. This led to the creation of Blue Sky Laws, which aimed to protect investors by requiring registration and disclosure of information about securities and their issuers.
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Example Series 65 Example Practice Question
A company wants to raise capital by issuing shares to investors. Before they can do so, they must register their securities with the appropriate state regulators and comply with ongoing post-registration requirements, such as providing financial statements and disclosing material changes in their business.
- State-level security registration: The process of registering a security with the state regulatory authority, as required by the Uniform Securities Act (USA), to ensure compliance with state laws and regulations before it can be offered for sale to the public within that state.
- State-level security registration example: A company based in California wants to issue new shares to raise capital. Before offering these shares to the public, the company must register the securities with the California Department of Financial Protection and Innovation (DFPI) to ensure compliance with state regulations.