Apply Professional Conduct Standards - Securities Industry Essentials SIE

1. Identify the FINRA dispute resolution forum typically used for customer claims against a broker-dealer.

   FINRA Arbitration (or FINRA Mediation if agreed). This process offers a neutral, efficient venue for resolving disputes between customers and broker-dealers.

2. Which disciplinary outcome is most directly described as a permanent prohibition from association with any FINRA member?

   Bar (permanent bar). This sanction permanently excludes an individual from the securities industry due to serious misconduct.

3. What is the FINRA name for the form used when a registered person leaves a member firm, including reasons and disclosures?

   Form U5. This form provides a record of termination details to inform future employers and regulators of any issues.

4. Identify the FINRA rule that prohibits "selling away" unless the associated person provides notice and receives firm approval when required.

   FINRA Rule 3280 (Private Securities Transactions). This rule prevents unauthorized dealings by requiring disclosure to avoid conflicts and ensure firm oversight.

5. What is the FINRA name for the document used to report customer complaints, regulatory actions, and other disclosures by a registered person?

   Form U4 (and updates via Form U4 amendments). This form ensures transparency by requiring disclosure of events that could affect a person's fitness for registration.

6. Identify the prohibited practice: recommending frequent trades primarily to generate commissions, not to benefit the customer.

   Churning (violates FINRA Rule 2010 and suitability obligations). This practice breaches ethical and suitability standards by prioritizing broker commissions over client interests.

7. Which disciplinary outcome is most directly described as a temporary removal from association with any FINRA member?

   Suspension. This penalty temporarily halts an individual's ability to work in the industry for violations of FINRA rules.

8. What is the FINRA rule that restricts gifts and gratuities to any one person when tied to the business relationship?

   FINRA Rule 3220 (Gifts; limit is $100$ per person per year). This rule prevents undue influence by capping gifts to avoid conflicts in business relationships within the industry.

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