SECURITIES INDUSTRY ESSENTIALS (SIE) EXAM CANDIDATES, STUDY AND KNOW FINRA RULES ON ADVERTISING AND COMMUNICATIONS WITH THE PUBLIC !

FINRA publishes a Content Outline for the Securities Industry Essentials (SIE) Exam. Under Section 3.2.5, FINRA's Content Outline lists "Communications with the Public." The primary FINRA rule governing communications with the public is FINRA Rule 2210. Before you sit for the SIE Exam, make sure that you are familiar with the main provisions of Rule 2210.

Bob Eder has a full treatment of Rule 2210 Communications with the Public in his Study for the Securities Industry Essentials (SIE) Exam. Here is an example of Bob Eder's treatment:

"Correspondence (3.2.5)

"FINRA defines "correspondence" as any written or electronic communication that a brokerage firm or representative sends, distributes, or makes available to 25 or fewer retail investors, within any 30-calendar-day period. If a representative sends material to more than 25 retail customers within any 30-day period, then it would be "retail communications." However, FINRA does not include materials sent to 25 or less retail customers within a 30-day period as "retail communications."


"EXAMPLE

Moe of Manny Brokerage Co. makes up sales literature intended only for institutional investors, such as Internet Bank. Remember that FINRA's requirement that a principal approve before use does not apply to communications intended only for institutional investors, such as banks or insurance companies. However, Moe learns that Internet Bank plans to forward copies to hundreds of Manny Brokerage Co.'s retail customers. Moe pretends that he is unaware of this transmission because he does not want to go through the hassle of having FINRA approve it. Moe would thus violate FINRA Rule 2210 on communications with the public."


Here is the link to FINRA's Content Outline for the SIE Exam. See the references to Communications with the Public in FINRA's Content Outline, Section 3.2.5.

Study for the Securities Industry Essentials (SIE) Exam is available from Amazon in both paperback and Kindle e-book versions. Here is the link to Bob Eder's book on Amazon.

For questions about Bob Eder's Study for the Securities Industry Essentials (SIE) Exam, or questions in general about the SIE exam, or about Communications with the Public, feel free to email Bob Eder at bobeder@bobeder.net.

Bob Eder received his Juris Doctor (J.D.) degree from the University of Utah, Quinney College of Law, in 2001. See Bob Eder's Author Page on Amazon.com.

Comments

Post a Comment

Popular posts from this blog

SIE EXAM INCLUDES QUESTIONS ON DEPOSITORY CLEARING CORPORATIONS, SO BE PREPARED!

Planning to take the Securities Industry Essentials (SIE) exam soon? Be prepared for questions asking about depository clearing corporations. Can you say in one sentence the purpose and function of the Depository Trust & Clearing Corporation (DTC)? No response? Then you are like most SIE candidates, so don't feel too bad! Bob Eder's Study for the SIE Exam covers the definition and functions of the DTC, as well as the Options Clearing Corporation and ACATS. Here is a section from Bob Eder's book taken from page 12: Depository Trust & Clearing Corp. (DTCC) (1.1.4)  "The Depository Trust provides clearing and transfer services to the brokerage industry in the U.S. and throughout the world. With volume of securities trades approaching millions on a daily basis, imagine brokerage operations without a centralized entity that could match buys with sells, and keep brokerage firm back offices running smoothly and efficiently. What chaos without an organization like the
Read more

TAKING THE SIE EXAM? DID YOU KNOW THAT THE LARGEST SECTION OF THE TEST IS SECTION 2 PRODUCTS AND THEIR RISKS?

Have you looked at FINRA's SIE Exam Content Outline or Test Specifications? You would find that the largest percentage of questions on the SIE Exam comes from Section 2, Understanding Products and Their Risks . Forty-four percent of the questions on your test will come from this Section. For example, Section 2 covers Equity Securities, including knowledge of voting rights, convertible securities, and selling control or restricted stock. Bob Eder in his Study for the Securities Industry Essentials (SIE) Exam has detailed coverage of these items. Here is a sample of Bob Eder's treatment: Control Stock (2.1.1) Control stock denotes shares that have been purchased by a control person or by an affiliated person. When a person owns shares in a company in which he/she is an officer, controlling person, termed an "affiliated person," there are also restrictions on the sale of that stock. The SEC calls the shares, "control shares." Only control or affiliated perso
Read more

SEC CHARGES 10 BROKER/DEALERS/INVESTMENT ADVISERS WITH FAILURE TO KEEP RECORDS OF "OFF-CHANNEL COMMUNICATIONS" WITH CLIENTS

FINRA makes available a Content Outline for the Securities Industry Essentials (SIE) Exam for those planning to sit for the exam. This Content Outline describes the subject matter of the SIE Exam. The SIE Content Outline includes Section 3.2.4 which covers Books and Records Regulations, and it encompasses the use of social media to communicate with clients, digital messaging, and internet communications. From time to time, the SEC issues press releases about penalties and charges brought against broker/dealers and advisers. Here is a recent one that imposes penalties on 10 firms for inadequate Record-Keeping of electronic communications, called "Off-Channel Communications." We include the SEC Release here because it demonstrates that a broker or adviser must treat the rules as having real life consequences, potentially bringing serious penalties and large fines for non-observance. Students who plan on sitting for the SIE Exam should pay careful attention to the SEC Release as
Read more