Under the Uniform Securities Act (USA), the term "investment adviser" does not apply to
I. an investment advisory firm owned and operated by a sole proprietor.
II. a bank or savings institution.
III. an investment adviser representative.
IV. a broker-dealer or its agents if the advice is incidental to the business although there is a nominal
charge for any specific investment advice given.
Price pegging refers to
The Administrator may require a firm to supply it with any prospectus, pamphlet, advertisement, or other
sales literature intended for prospective investors unless the security
I. will be sold only through an investment advisory firm.
II. is a federal covered security.
III. is issued by a state credit union.
The Administrator of a state can deny an application if
Noah Aull is an investment adviser representative with Canto Investment Advisers. A client has called and
told Noah that he heard about a firm that had recently completed an IPO at a party he had attended that
weekend and instructed Noah to purchase shares of the company, which was now trading on the OTC
Bulletin Board. Noah did some research and felt the company was far too risky an investment for this
client, so he did not execute the trade. This turned out to be fortunate for his client since the firm became
insolvent within six months of its IPO. Has Noah done anything wrong?
