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← Series 63: Regulation of Investment Advisers
Series 63 practice questioneasyExemptions

A federal covered adviser must generally make a notice filing with a state if it:

  1. AHas no place of business in the state and no clients there
  2. BHas more than five individual clients in the state during the past 12 months✓ Correct answer
  3. COnly advises investment companies registered under the Investment Company Act of 1940
  4. DDoes not solicit business in the state
Explanation

Why B — Has more than five individual clients in the state during the past 12 months

If a federal covered adviser has a place of business or more than five individual clients in a state, it typically must notice file there (USA Sec. 405). C is incorrect because advising registered investment companies may exempt from notice filing, and A and D describe scenarios not requiring notice filing.

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