Investment Company and. Variable Contracts Products Principals (Series 26) Practice Exam

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How long do broker-dealers have to validate securities upon receiving a Transfer Information Form?

1 business day
2 business days
3 business days
5 business days

The correct answer is: 1 business day

Broker-dealers are required to validate securities within one business day upon receiving a Transfer Information Form. This timeframe ensures that the transfer process is handled efficiently and promptly, allowing clients to have swift access to their assets. The one-business-day requirement reflects the regulatory expectation for broker-dealers to maintain timely communication and operations, particularly in areas involving customer assets and account transfers. By adhering to this timeframe, broker-dealers help protect clients' interests and promote confidence in the securities transfer process.