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FINRA Securities Industry Essentials (SIE) Exam

4. Overview of the Regulatory Framework: practice questions

Our FINRA SIE bank has 28 questions on this topic. Here are 5 of them with answers; the full mock exam draws from every topic, like the real one.

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Question 1

What is a 'political contribution' rule concern for municipal securities professionals?

  1. They must be made in cash
  2. Contributions to issuer officials can bar the firm from municipal business (MSRB Rule G-37)
  3. There are no rules
  4. They are always tax-deductible
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B. Contributions to issuer officials can bar the firm from municipal business (MSRB Rule G-37) — This prevents 'pay to play'.

Question 2

Within how many days must a firm file Form U5 after a registered person's termination?

  1. 10 days
  2. 30 days
  3. 1 year
  4. 60 days
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B. 30 days — A copy must be given to the individual.

Question 3

What is a 'principal' at a FINRA member firm?

  1. The firm's lawyer
  2. A market maker
  3. Any customer
  4. A person who supervises the firm's business and approves certain activities
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D. A person who supervises the firm's business and approves certain activities — Principals need specific qualification exams.

Question 4

How are most disputes between customers and broker-dealers resolved?

  1. In the Supreme Court
  2. By the SEC
  3. Through FINRA arbitration, often required by the account agreement
  4. Through state legislatures
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C. Through FINRA arbitration, often required by the account agreement — Arbitration decisions are generally final and binding.

Question 5

Which form does a firm file to register as a broker-dealer?

  1. Form U4
  2. Form BD
  3. Form 1099
  4. Form ADV
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B. Form BD — Investment advisers use Form ADV.

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