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Finra Series-7 Exam - Topic 2 Question 119 Discussion

Actual exam question for Finra's Series-7 exam

Question #: 119
Topic #: 2

[All Series-7 Questions]

Which of the following is not a practice of a mutual fund custodian?

Achanging shareholder registrations on the fund's records

Bdisbursing dividends and capital gains to the fund's shareholders

Clending the fund's securities to banks or broker/dealers

Dmaintaining sales records for the fund's underwriter

Show Suggested Answer

Suggested Answer: C

lending the fund's securities to banks or broker/dealers. This practice is not permitted under federal law.

by Gregg at Nov 21, 2025, 04:58 PM

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Malcom

5 months ago

C is definitely not a custodian's practice. Solid reasoning!

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Nikita

5 months ago

I chose A. Changing registrations feels like a fund manager's job.

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Bronwyn

5 months ago

Definitely C. Lending isn't their role.

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Joanna

6 months ago

They really don’t handle sales records? That’s surprising!

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Yvonne

6 months ago

D seems like the odd one out to me.

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Gail

6 months ago

Wait, are you sure about that? I thought they did!

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Mariann

7 months ago

I agree, custodians don’t lend securities.

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Xuan

7 months ago

C is definitely not a custodian's job.

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Salena

7 months ago

Haha, the custodian is like the bank teller of the mutual fund world. They just handle the boring stuff, not the fun stuff like lending securities.

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Na

7 months ago

D seems like the correct answer. Maintaining sales records is the underwriter's responsibility, not the custodian's.

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Chantell

7 months ago

I think the answer is C. Lending securities is not a custodian's job.

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Gail

7 months ago

Lending securities sounds like something a custodian would do, but I can't recall if it's a core function or not.

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Annelle

8 months ago

I feel like changing shareholder registrations might be something they do, but I'm not completely confident about that.

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Kandis

8 months ago

I remember a practice question about custodians and their roles, and I think they definitely do disburse dividends, so that can't be the answer.

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Phillip

8 months ago

I think the custodian is involved in managing assets, but I'm not sure if they handle sales records for underwriters.

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Yasuko

8 months ago

Ugh, I'm still a bit confused on the exact responsibilities of a mutual fund custodian. Guess I need to review that section again before the exam.

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Carmelina

8 months ago

I'm leaning towards C as the answer, since lending securities doesn't seem like a core custodian duty. But I'll double-check my notes to be sure.

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Juliann

8 months ago

I feel like D could be tricky too. But it's more about sales.

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Maddie

9 months ago

Agreed, C seems off. They focus on safekeeping.

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Miriam

9 months ago

I think it's C. Custodians don't lend securities.

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Aleta

9 months ago

I'm pretty confident the custodian doesn't handle sales records for the underwriter. That seems more like an administrative function.

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Colette

9 months ago

B is the right answer. Disbursing dividends and gains is a key custodian function.

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Chi

9 months ago

Okay, let's see. I know the custodian handles things like shareholder records and distributions, but lending securities? That doesn't sound right.

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Luisa

10 months ago

Hmm, this one seems tricky. I'll need to think through the different responsibilities of a mutual fund custodian.

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Louvenia

4 months ago

D seems more like an underwriter's role. Custodians don't maintain sales records.

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Sabina

4 months ago

True, but that's still part of record-keeping, right?

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Sabra

5 months ago

But what about A? Changing shareholder registrations sounds important too.

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Vincent

5 months ago

Yeah, I agree. Custodians usually handle records and distributions.

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Laura

5 months ago

I think it's C. Lending securities doesn't seem like a custodian's job.

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