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Regulatory Compliance & Legal Framework Flashcards

7 cards from real RMA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Regulatory Compliance & Legal Framework flashcards as text

  1. The SEC's Regulation Best Interest (Reg BI) requires broker-dealers to act in the client's best interest at the time of which event?

    Answer: Making a recommendation

    Reg BI imposes the best-interest obligation specifically at the moment a recommendation is made to a retail customer.

  2. Which ERISA vesting schedule allows a participant to be 100% vested after three years of service?

    Answer: Cliff vesting

    Under cliff vesting, participants become fully vested all at once, which ERISA allows after no more than three years for employer contributions.

  3. A plan administrator fails to provide a Summary Plan Description within 90 days of a participant's eligibility. Which agency enforces this requirement?

    Answer: DOL Employee Benefits Security Administration

    The DOL's Employee Benefits Security Administration (EBSA) enforces ERISA's disclosure requirements, including timely SPD delivery.

  4. Under HIPAA, which retirement plan provision restricts the use of health information for plan enrollment eligibility?

    Answer: HIPAA nondiscrimination rules for group health plans

    HIPAA's nondiscrimination rules prohibit group health plans from denying enrollment or charging higher premiums based on health status.

  5. The annual additions limit under IRC Section 415(c) for defined contribution plans in 2024 is:

    Answer: $69,000

    The Section 415(c) annual additions limit for defined contribution plans is $69,000 for 2024, covering all employer and employee contributions.

  6. Under ERISA Section 3(38), an investment manager must be which of the following to accept fiduciary responsibility for investment decisions?

    Answer: A bank, insurance company, or registered investment adviser

    ERISA Section 3(38) defines an investment manager as a bank, insurance company, or RIA that acknowledges fiduciary status in writing.

  7. Which rule requires that top-heavy plans provide minimum contributions to non-key employees?

    Answer: IRC Section 416 top-heavy rules

    IRC Section 416 mandates that top-heavy plans contribute at least 3% of compensation to non-key employees.