Objectives in this domain

Apply the standards, required approvals, and content rules for retail, correspondence, and institutional communications, including options and municipal communications and the options disclosure document.
Section 1.1medium
Describe the process of bringing new issues to market, including the registration statement, preliminary and final prospectus, syndicate roles, and exemptions from registration under the Securities Act of 1933.
Section 1.2hard

Sample question from this domain

Free sampleSeeks Business for the Broker-Dealer from Customers and Potential Customersmedium

Under FINRA Rule 2210, which requirement generally applies to a retail communication before a member firm uses it?

AA registered principal must approve it before the earlier of its use or filing with FINRA, unless a stated exception applies. Correct
BIt must be filed with and approved by the SEC's Division of Trading and Markets before the firm may first use it.
CIt requires no supervisory review at all because retail communications are exempt from the content standards.
DIt must be pre-cleared by the MSRB whenever the communication mentions any municipal or corporate security.

A registered principal must approve a retail communication before the earlier of its use or filing, absent an exception. Rule 2210(b) places prior principal approval at the centre of retail communication supervision, requiring sign-off before the piece is used or filed so the firm catches misleading content before it reaches investors.

Why A is correct: Rule 2210(b) requires an appropriately qualified registered principal to approve each retail communication before the earlier of its use or filing, subject to limited exceptions.

Why B is wrong: Filing, where required, goes to FINRA's Advertising Regulation Department, not the SEC, and prior SEC approval of communications is not the mechanism Rule 2210 uses.

Why C is wrong: The opposite is true: retail communications are the most heavily supervised category and are fully subject to the content standards.

Why D is wrong: The MSRB does not pre-clear firm communications; municipal advertising has its own MSRB rules, but Rule 2210 approval runs through a member's registered principal.

Other domains in this exam

See also the Series-7 cert hub, the study guide, and the cheat sheet.