General Securities Sales Supervisor (Series10) Practice Exam

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Study for the General Securities Sales Supervisor (Series 10) Exam. Enhance your skills with multiple choice questions and explanations. Master your exam with detailed insights and tips!

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According to MSRB rules, when must new account information, excluding social security numbers, be obtained?

A Prior to opening the account
B Prior to entering an order
C Prior to accepting a check from a customer
D Prior to settling the transaction

The correct answer is: D Prior to settling the transaction

According to the rules set by the Municipal Securities Rulemaking Board (MSRB), the correct understanding is that new account information, with the exception of social security numbers, must be obtained prior to settling a transaction. This rule ensures that the broker-dealer has sufficient information about the account holder to comply with regulatory requirements, including anti-money laundering practices and due diligence guidelines. By mandating that this information be collected before settlement, the MSRB aims to protect both the investor and the integrity of the market by ensuring that all transactions are properly documented and that the customer is known to the broker-dealer participating in the trade. This is crucial for the overall transparency and operational efficiency of the securities transaction process. Gathering the information before the transaction is settled also allows the firm to address any potential issues or discrepancies with account details that might arise during the transaction process, thereby minimizing exposure to risk.