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Question 1 of 10
1. Question
What does Section 5 of the Securities Exchange Act of 1933 set forth rules and prohibitions with respect to?
Correct
Section 5 of the Securities Exchange Act of 1933 sets forth several rules and prohibitions with respect to the use of interstate commerce and the mail service in selling securities. Specifically, the act prohibits the use of interstate commerce or the mail system to sell any security that does not have a registration statement in place. It also prohibits the sale of a security or the delivery of a prospectus unless the prospectus of such security conforms to Section 10 of the Securities Exchange Act of 1933.
Incorrect
Section 5 of the Securities Exchange Act of 1933 sets forth several rules and prohibitions with respect to the use of interstate commerce and the mail service in selling securities. Specifically, the act prohibits the use of interstate commerce or the mail system to sell any security that does not have a registration statement in place. It also prohibits the sale of a security or the delivery of a prospectus unless the prospectus of such security conforms to Section 10 of the Securities Exchange Act of 1933.
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Question 2 of 10
2. Question
What is one condition of the sale of a security or the delivery of a prospectus?
Correct
The Securities Exchange Act of 1933 prohibits the sale of a security or the delivery of a prospectus unless the prospectus of such security conforms to Section 10 of the Securities Exchange Act of 1933.
Incorrect
The Securities Exchange Act of 1933 prohibits the sale of a security or the delivery of a prospectus unless the prospectus of such security conforms to Section 10 of the Securities Exchange Act of 1933.
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Question 3 of 10
3. Question
What is the case in which securities cannot be offered for sale?
Correct
Under Section 5 of the Securities Exchange Act of 1933, securities cannot be offered for sale if the registration statement is the subject of a refusal order or a stop order prior to the registration date.
Incorrect
Under Section 5 of the Securities Exchange Act of 1933, securities cannot be offered for sale if the registration statement is the subject of a refusal order or a stop order prior to the registration date.
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Question 4 of 10
4. Question
Pursuant to Section 10 of the Securities Act of 1933, when does the registrations statement of the security become effective?
Correct
Pursuant to Section 10 of the Securities Act of 1933, the prospectus must be submitted along with the registration statement for a security, but is not deemed to be part of that registration statement. Upon submission, the registrations statement of the security is effective the twentieth day after filing, or earlier if approved by the Commission.
Incorrect
Pursuant to Section 10 of the Securities Act of 1933, the prospectus must be submitted along with the registration statement for a security, but is not deemed to be part of that registration statement. Upon submission, the registrations statement of the security is effective the twentieth day after filing, or earlier if approved by the Commission.
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Question 5 of 10
5. Question
Which of the following Sections of the Securities Act is concerned with civil liabilities?
Correct
Incorrect
Section 11 of the Securities Act of 1933 provides purchases of securities with an avenue for pursuing civil liabilities as a result of fraudulent activities.
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Question 6 of 10
6. Question
How did Section 11 of the Securities Act of 1933 impact the right of the investors?
Correct
Pursuant to Section 11 of the Securities Act of 1933, the investor would have the opportunity to sue anyone who signed the registration statement, anyone who was a director or partner in the issuer at the time of filing the registration, every person who is currently or about to be named a director, every underwriter of the security, and every accountant, engineer, or appraiser whose statement in such a registration statement is the subject of the fraudulent activity.
Incorrect
Pursuant to Section 11 of the Securities Act of 1933, the investor would have the opportunity to sue anyone who signed the registration statement, anyone who was a director or partner in the issuer at the time of filing the registration, every person who is currently or about to be named a director, every underwriter of the security, and every accountant, engineer, or appraiser whose statement in such a registration statement is the subject of the fraudulent activity.
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Question 7 of 10
7. Question
Pursuant to Section 11 of the Securities Act of 1933, The suit to recover damages equal to…
Correct
Pursuant to Section 11 of the Securities Act of 1933, the suit to recover damages equal to the difference between the amount paid for the security and either (i) the values of the security at such time the suit was brought, (ii) the price at which the security was sold in the market before the suit was brought, or (iii) the price at which the security will be sold after the suit was brought but before damages have been determined.
Incorrect
Pursuant to Section 11 of the Securities Act of 1933, the suit to recover damages equal to the difference between the amount paid for the security and either (i) the values of the security at such time the suit was brought, (ii) the price at which the security was sold in the market before the suit was brought, or (iii) the price at which the security will be sold after the suit was brought but before damages have been determined.
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Question 8 of 10
8. Question
Which Section of the Securities Act of 1933 is concerned with fraudulent interstate transactions?
Correct
As provided in Section 17 of the Securities Act of 1933, “It shall be unlawful for any person in the offer or sale of any securities (including security-based swaps) or any security-based swap agreement by the use of any means or instruments of transportation or communication in interstate commerce or by use of the mails, directly or indirectly:
1. To employ any device, scheme, or artifice to defraud, or
2. To obtain money or property by means of any untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading, or
3. To engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser.Incorrect
As provided in Section 17 of the Securities Act of 1933, “It shall be unlawful for any person in the offer or sale of any securities (including security-based swaps) or any security-based swap agreement by the use of any means or instruments of transportation or communication in interstate commerce or by use of the mails, directly or indirectly:
1. To employ any device, scheme, or artifice to defraud, or
2. To obtain money or property by means of any untrue statement of a material fact or any omission to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made, not misleading, or
3. To engage in any transaction, practice, or course of business which operates or would operate as a fraud or deceit upon the purchaser. -
Question 9 of 10
9. Question
Which Act refers to the irresponsibility of the investors about the truth and accuracy of the registration statement?
Correct
Section 23 of the Securities Act of 1933, often referred to as the “no approval clause,” is meant to indicate to investors that while the SEC is responsible for approving the registration of a security, they are in no way responsible for the truth and accuracy of the registration statement and do not warrant the security as being a good investment.
Incorrect
Section 23 of the Securities Act of 1933, often referred to as the “no approval clause,” is meant to indicate to investors that while the SEC is responsible for approving the registration of a security, they are in no way responsible for the truth and accuracy of the registration statement and do not warrant the security as being a good investment.
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Question 10 of 10
10. Question
“It shall be unlawful to make, or cause to be made, to any prospective purchaser any representation contrary to the foregoing provisions of this section.” From which Act is this language taken?
Correct
Section 23 of the Securities Act of 1933 reads as follows: “Neither the fact that the registration statement for a security has been filed or is in effect nor the fact that a stop order is not in effect with respect thereto shall be deemed a finding by the Commission that registration statement is true and accurate on its face or that it does not contain an untrue statement of fact or omit to state a material fact, or be held to mean that the Commission has in any way passed upon the merits of, or given approval to, such security. It shall be unlawful to make, or cause to be made, to any prospective purchaser any representation contrary to the foregoing provisions of this section.”
Incorrect
Section 23 of the Securities Act of 1933 reads as follows: “Neither the fact that the registration statement for a security has been filed or is in effect nor the fact that a stop order is not in effect with respect thereto shall be deemed a finding by the Commission that registration statement is true and accurate on its face or that it does not contain an untrue statement of fact or omit to state a material fact, or be held to mean that the Commission has in any way passed upon the merits of, or given approval to, such security. It shall be unlawful to make, or cause to be made, to any prospective purchaser any representation contrary to the foregoing provisions of this section.”