Series 63 practice questionhardNotice Filing vs. Registration
A federally registered mutual fund fails to file the required notice with a state prior to offering shares. Under the USA, what action may the state Administrator take?
- ASuspend the offer of the shares in the state until the notice is properly filed✓ Correct answer
- BRevoke the mutual fund’s SEC registration
- CRequire merit review of the fund’s prospectus
- DImpose additional ongoing reporting requirements
Explanation
Why A — Suspend the offer of the shares in the state until the notice is properly filed
States may require notice filings and can suspend the offer until the filing is made (USA Section 302(d)). They cannot revoke SEC registration (B), require merit review (C), or create burdensome ongoing reporting (D).
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