Series 63 practice questionmediumIA Exemptions and Exclusions — Exclusion for Certain Professionals
On a final review set, the question is presented in this context. The key is the registration, exemption, or ethical rule doing the real work. A practicing attorney in State Z occasionally provides investment-related advice to clients as an incidental part of her law practice. She does not charge a separate fee for this advice. Under the USA, which statement is correct?
- AShe is excluded from the definition of investment adviser under the USA.✓ Correct answer
- BShe must register as an investment adviser in State Z.
- CShe must register if she has more than five clients.
- DShe must register only if she manages client investments.
Explanation
Why A — She is excluded from the definition of investment adviser under the USA.
The USA excludes lawyers, accountants, teachers, and engineers from the investment adviser definition if their investment advice is incidental to their professional practice and no separate fee is charged (USA Section 401(c)). This variant keeps the same legal rule but shifts the setup so recall has to stay flexible.
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