Even though the Series 65 and 66 exams are for advisers and adviser reps, the questions frequently concern the broker-dealer side of the business. Therefore, let's see if you can answer a question like this one:
Javier Gamboa is a registered representative with AmericaFirst Securities, LLC. Javier was recently called up for active military duty in Afghanistan, where he is expected to remain deployed for 28 months. Therefore which of the following statements is/are accurate?
I. Javier's license will remain in effect if he completes Continuing Education while serving active military duty
II. Javier may receive commissions on securities transactions while serving active military duty
III. Javier must requalify by exam if his active military duty assignment exceeds 24 months
IV. Javier's license will remain in effect if he completes Continuing Education requirements after serving active military duty
A. II, IV
B. I, III
C. II, III
EXPLANATION: when a registered rep or principal is called up for active military duty, the SEC/FINRA are very accomodating. The rep's license is placed on inactive status, and the CE requirements are waived, as is the requirement to requalify by exam after a 2-year-plus absence. He can earn commissions on his "book of business" and will probably cut a deal with a fellow registered rep to service his customers while he's away. Javier can not perform any of the functions of a registered rep during this period, no matter how impressive it might be for customers to get a phone call from a guy dodging RPG's as he also worries about their asset allocation strategies.