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Series 63: Regulation of Broker-Dealers & Agents
Series 63 practice questionmediumAgent registration—private placements

An individual represents a broker-dealer in selling private placements to high-net-worth individuals in State S. Under the USA, must this individual register as an agent?

  1. AYes, because they are representing a broker-dealer in effecting securities transactions.✓ Correct answer
  2. BNo, because private placements are exempt transactions.
  3. CNo, unless the clients are institutional investors.
  4. DYes, only if the securities are not federally covered.
Explanation

Why AYes, because they are representing a broker-dealer in effecting securities transactions.

Anyone effecting securities transactions for a broker-dealer must register as an agent, regardless of the exemption status of the transaction (USA Sec. 401(b)). Exempt transactions do not exclude broker-dealer representatives from registration.

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