SIE Knowledge of Capital Markets Question 34: Answer and Explanation

Question: 34

Which of the following statements is true regarding a transfer agent?

• A. Guidance regarding a transaction must be given orally and in written form.
• B. Guidance regarding a transaction must be in written form.
• C. Information is maintained regarding all the investments held by officers of the firm.
• D. FINRA sets rules regarding how and when the records are changed.

Correct Answer: B

Explanation:

B: Choice B is correct because instructions must be provided in written form. Choice A is incorrect because instructions need not be provided orally. Choice C is incorrect because only the records of ownership of securities issued by the firm are maintained by the transfer agent. Choice D is incorrect because the SEC determines standards of processing, including amount of time allowed for recording changes of ownership.