MSRB NOTICE 2012-57 (NOVEMBER 16, 2012)

MSRB REVISES SERIES 53 STUDY OUTLINE

The Municipal Securities Rulemaking Board (MSRB) has revised the study outline for the Municipal Securities Principal Qualification Examination (Series 53).[1]  The Series 53 is designed to determine whether an individual meets the MSRB’s qualification standards for a municipal securities principal.[2]  The revisions remove rescinded rules and include amendments and additions to MSRB rules.  Series 53 examinations based on the revised study outline will commence on December 22, 2012. 

A summary of the changes to the study outline, detailed by major topic headings, is provided below.  Changes are stated as revisions to the current outline.

Introduction

  • fn. 1:  References to “NASD” are changed to “FINRA;” FINRA URL is corrected.

Part Two—General Supervision

Definitional Rules

  • “Municipal advisory activities, D-13” is added.

Qualification and Registration

  • “name or address” is added to the description for Rule A-15.
  • “preservation” is added to the description for Rules G-7; G-9; and Exchange Act Rule 17a-4.
  • “municipal securities sales limited representatives” is added to the description of Rule G-3(a)(i) and (ii) to reflect amendment to the rule.

Supervisory Responsibilities

  • Rule citation for “Written record of designations” is changed to “G-27(b)(ii)(B)” to reflect amendment to the rule.
  • Rule citation for “Appropriate principal” is changed to “G-27(b)(ii)(C)” to reflect amendment to the rule.
  • Topic heading and rule citation is changed to “Duty to establish, maintain and enforce supervisory control policies and written procedures” to reflect amendment to the rule.

Conduct of Business

  • “Definitions; general standard for advertisements” is added to the description for Rule G-21(a).
  • “Product” is added to the topic description for Rule G-21(e).

Part Three—Sales Supervision

Opening Customer Accounts

  • Rule citation for “Review and approval by a principal” is changed to “G-27(c)(i)(G)(1)” to reflect amendment to the rule.

Communications with Customers

  • Rule citation for “Review and retention of correspondence” is changed to “G-27(e)” to reflect amendment to the rule.

Discretionary Accounts

  • Rule citation for “Written supervisory procedures” is changed to “G-27(c)(i)” to reflect amendment to the rule.

Part Four—Origination and Syndication

Financial Advisors

  • Rule citation for “applicability of state or local law” is changed to G-23(f) to reflect amendment to the rule.
  • “Basis of compensation” is deleted; “Agreement with respect to financial advisory relationship” is added for the description of Rule G-23(c).  Changes reflect the amendment to the rule.
  • The description of Rule G-23(d) is changed to “Prohibition on engaging in underwriting activities” in accordance with the amendment to the rule.
  • “Disclosures to customers, G-23(h)” is deleted in accordance with the amendment to the rule.
  • “Disclosures to issuer of corporate affiliation, G-23(f)” is deleted in accordance with the amendment to the rule.
  • “Records concerning the activities of financial advisors, G-23(g); G-9” is deleted in accordance with the amendment to the rule.
  • “Responsibility to make official statement available” is changed to “Preparation of official statement by financial advisors;” rule citation is changed to “G-32(c)” in accordance with the amendment to the rule.

New Issue Syndicate Practices

  • “Responsibility of managing underwriters and sole underwriters” is replaced with “Underwriter submissions to EMMA;” rule citation is changed to “G-32(b)” in accordance with amendments to the rule.
  • “Delivery of official statements, advance refunding documents, and Forms G-36(OS) and G-36(ARD) to the Board or its designee; G-36” is deleted.  Rule was rescinded.
  • Topic heading is changed to “Records concerning primary offerings” in accordance with amendment to Rule G-8(a)(viii).
  • Topic heading is changed to “Records concerning disclosures in connection with primary offerings pursuant to Rule G-32” in accordance with amendment to Rule G-8(a)(xiii).
  • “Records concerning delivery of official statements, advance refunding documents and Forms G-36(OS) and G-36(ARD) to the Board or its designee; G-8(a)(xv)” is deleted.  Topic is no longer tested.
  • “Good faith deposits; G-12(i)” is deleted.  Rule was rescinded.
  • Rule citation for “Settlement of syndicate or similar account” is changed to “G-11(i)” in accordance with the amendment to the rule.
  • Topic heading is changed to “Payments of designations;” rule citation changed to “G-11(j)” in accordance with the amendment to the rule.

Part Five—Trading

Execution of Transactions

  • Topic heading for Rule G-18 is changed to “Transactions as agent” to reflect amendment to the rule.
  • “Broker’s brokers; G-43” is added.

Reports of Sales or Purchases

  • Rule citation for “Definitions” is changed to “G-14, RTRS Procedures, Sect. (d)” for clarification.
  • Topic heading for Rule A-13(c) is changed to “Transaction and technology assessments” in accordance with the amendment to the rule.

Recordkeeping Responsibilities

  • “Records of secondary market trading account transactions; G-8(a)(xxiv)” is added.
  • “Broker’s brokers activities; G-8(a)(xxv)” is added.
  • “Records for alternative trading systems; G-8(a)(xxvi)” is added.

Part Six—Operations

Books and Records

  • “Records concerning consultants; G-8(a)(xviii)” is deleted.  No longer tested in the examination.
  • “Books and records maintained by transfer agents for municipal fund securities transactions; G-8(g)(i)” is added.
  • Correct rule citation is added to “Compliance with SEC rules” and “Records to be made” is deleted as a subtopic. 

Sample Questions

  • One sample question is deleted and a new sample question is added.

*  *  *  *  *

Questions about the Series 53 examination program may be directed to Loretta Jones, Director, Professional Qualifications, or Erik Dolan, Senior Professional Qualifications Analyst, at 703-797-6600.

November 16, 2012

CLICK HERE TO VIEW THE REVISED SERIES 53 STUDY OUTLINE


[2]  MSRB Rule G-3(b).