Which of the following is not in itself a reason for the Administrator to deny, suspend, or revoke the license
of a person?

• A. The applicant has never before worked in the securities industry although he has received the requisite
  training.
• B. The person is a broker-dealer whose agents have repeatedly been accused of churning and burning,
  according to written client complaints.
• C. The person has been convicted of check kiting within the past ten years.
• D. Some of the information supplied on the registration application was found to be false.

Which of the following statements regarding an investment adviser representative who has an office in the
state is true?

• A. Regardless of whether the investment adviser is registered with the SEC or is registered with the state,
  all investment adviser representatives of the firm must be registered with the state if they have offices in
  the state.
• B. If an investment adviser representative is registered with the SEC, he or she need not obtain state
  registration, regardless of whether the investment adviser representative has an office in the state.
• C. If the investment adviser is registered with the SEC, then neither the investment adviser nor any of its
  affiliated investment adviser representative needs to be registered with the state.
• D. If the investment adviser that the investment adviser representative is affiliated with is itself registered
  with the state, then the investment adviser representative does not need to apply for a separate
  registration, regardless of whether the investment adviser representative has an office in the state.

Which of the following may an investment adviser not use in an attempt to solicit new clients?

• A. a free initial consultation, with no obligation on the part of the potential client
• B. testimonials of satisfied clients
• C. a free financial planning kit, with no obligation on the part of the potential client
• D. a complete list of the stocks they have recommended in the past year, even if a statement is included
  that states that past performance is no guarantee of future performance

Rich Writewell wants to begin publishing an independent weekly financial newsletter that will provide
investment recommendations as well as other financial news items to the general public. Rich hopes that
his newsletter will achieve nationwide circulation within a few months. Which of the following statements
is true?

• A. Rich may be exempt from registering as an investment adviser if he is a lawyer,accountant, engineer,
  or teacher. Otherwise, he will have to register.
• B. Rich will not have to register as an investment adviser since he is publishing a legitimate financial
  newsletter for distribution to the general public.
• C. Rich will have to register as an investment adviser since his publication will include investment
  recommendations
• D. Rich will have to register as an investment adviser only if he sells this newsletter to the public.If the
  publication is to be distributed free of charge, he will not have to register.

D. Vious and Associates is a small broker-dealer trying to generate more business. To this end, the firm
had a professional four-color brochure printed that provides the years of industry experience of its
management along with other information. The firm's founder, Ms. D. Vious, is listed as having over 30
years of experience in the industry. Ms. D. Vious has worked for broker-dealers for over 30 years, but for
2 0 of those 30 years, she was a secretary. Has D. Vious violated any securities laws?

• A. No. Ms. D. Vious' years of experience is not a material fact that would affect an investor's investment decision.
• B. No. Advertising brochures are not securities.
• C. Yes. The broker-dealer is making a misleading statement in an advertising brochure in order to convince investors to do business with the firm.
• D. No. Technically, Ms. D. Vious does have over 30 years of experience in the industry, even though it was not in the capacity of an agent or a broker-dealer.