Finra Exam Series-6 Topic 4 Question 74 Discussion

Actual exam question for Finra's Series-6 exam

Question #: 74
Topic #: 4

[All Series-6 Questions]

Upon receiving a complaint about one of its member firms, FINRA may:

i. require any person associated with the member firm to provide information to FINRA and to testify under oath.

ii. inspect and copy the books, records and accounts of the member firm.

iii. share information obtained from its investigation of a member firm with a foreign regulatory agency.

AII only

BI and II only

CII and III only

DI, II, and III

Show Suggested Answer

Suggested Answer: D

Upon receiving a complaint about one of its member firms, FINRA may require any person associated with the member firm to provide information and to testify under oath; it may inspect and copy the books, records, and accounts of the member firm; and it may share information obtained from its investigation of a member firm with a foreign regulatory agency. The foreign regulator must agree to treat the information confidentiality, and the agreement with the foreign regulator is predicated on two requirements: ''(A) the other regulator party to the agreement must have jurisdiction over common regulatory matters; and (B) the agreement must require the other regulator to reciprocate and share with FINRA information of regulatory interest or concern to FINRA.''

by Joseph at Apr 13, 2024, 10:38 AM

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Paulina

8 days ago

That's a fair point. FINRA does have a lot of discretion in their investigations. But I trust they use those powers responsibly, for the greater good of investors and the industry. Plus, member firms can always appeal if they feel FINRA overstepped.

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Nakita

10 days ago

Absolutely. FINRA has to have those enforcement powers to maintain integrity in the markets. Although, I wonder if they ever abuse their authority. I mean, how do we know they're not just going on fishing expeditions sometimes?

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Leonor

11 days ago

Haha, yeah, that would not be a fun day at the office! But I suppose that's the price you pay for the privilege of being a FINRA-registered broker-dealer. Better keep those records in tip-top shape!

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Dorathy

12 days ago

You know, I'm just glad I'm not one of the poor saps working at a FINRA member firm. Can you imagine having the FINRA cops show up and start digging through your books? Yikes!

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Christene

14 days ago

I agree, D is the right answer. FINRA has broad investigative and enforcement powers to ensure member firms comply with regulations. Personally, I'm glad they can take such comprehensive actions when there's a compliance issue.

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Joanna

16 days ago

This is a pretty straightforward FINRA compliance question. I'm comfortable with the regulatory powers FINRA has over its member firms. The correct answer is clearly D, since all three options are valid actions FINRA can take.

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