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Exam Series 63 All Questions

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Exam Series 63 topic 1 question 96 discussion

Actual exam question from FINRA's Series 63
Question #: 96
Topic #: 1
[All Series 63 Questions]

Which of the following statements is false?

  • A. A state cannot require a higher minimum net capital for broker-dealers than the amount specified by the Securities Exchange Act of 1934.
  • B. A state cannot require a higher minimum net capital for investment advisers than the amount specified by the Investment Advisers Act of 1940.
  • C. The minimum net capital requirement for investment advisers that take custody of their clients' assets is higher than the net capital requirement for advisers who do not take custody of the assets.
  • D. None of the above statements is false; all are true statements.
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Suggested Answer: B 🗳️
"A state cannot require a higher minimum net capital for investment advisers than the amount specified by the Investment Advisers Act of 1940" is a false statement. The Investment Advisers Act of 1940 does not specify a minimum net capital requirement. The Act simply indicates that if an investment adviser is already registered in one state and meeting that state's minimum net capital requirement, a second state can't impose a higher net capital requirement on it.

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