Series 7 Prospecting and Communications Practice Questions

Correct answer: C. 25 retail investors

FINRA Rule 2210(a) defines 'correspondence' as any written or electronic communication distributed or made available to 25 or fewer retail investors within any 30-calendar-day period. Once a communication reaches more than 25 retail investors in that window, it is reclassified as a 'retail communication,' triggering stricter content standards and, for many types, prior principal approval. The other figures are not thresholds found anywhere in the rule.

• AA. 10 is below the actual threshold FINRA uses to distinguish correspondence from retail communication.
• BB. 15 is not the correct number; the rule sets the correspondence threshold higher.
• CC. Correspondence under Rule 2210 is limited to distribution to 25 or fewer retail investors within any 30-calendar-day period; exceeding that reclassifies the piece as retail communication.
• DD. 35 exceeds the actual threshold set in the rule; correspondence is capped at 25 retail investors within 30 days.

• Source: FINRA Rule 2210 (Communications with the Public), accessed October 2026

Correct answer: A. Yes, an inquiry creates an established business relationship allowing calls for up to 3 months from the date of the inquiry

The established business relationship (EBR) exception permits calls to a Do-Not-Call registrant for 3 months following the consumer's inquiry or application, and for 18 months following the consumer's last purchase, transaction, or payment. Since this prospect merely inquired (no transaction) six weeks ago, the firm remains within the 3-month inquiry-based window and may call. An inquiry does not get the longer 18-month period. That is reserved for completed transactions.

• AA. A mere inquiry (without a completed transaction) creates an established business relationship that permits telemarketing calls for up to 3 months from the date of the inquiry, so a call six weeks later is still permitted.
• BB. 18 months is the duration tied to an established business relationship formed by a completed transaction, not by a mere inquiry, which carries the shorter 3-month window.
• CC. An inquiry alone, not just a completed transaction, can create a (shorter) established business relationship exception under the Do-Not-Call rules.
• DD. The Do-Not-Call rules do carry recognized exceptions, including the inquiry-based established business relationship, so this overstates the registry's reach.

• Source: 16 CFR § 310.2, accessed October 2026

Correct answer: D. 3 years total, with the first 2 years easily accessible

Under SEC and FINRA recordkeeping requirements, communications with the public generally must be preserved for three years, with the records from the most recent two years kept in an easily accessible place for prompt retrieval, consistent with the firm's broader books-and-records obligations.

• AA. This understates the retention period. Business-related communications with the public must be kept 3 years, not 2, and the easily accessible period is the first 2 years, not 1.
• BB. A 6-year period applies to certain other records, such as ledgers and some account records, but not to general communications with the public. These are kept 3 years, with the first 2 years easily accessible.
• CC. This overstates the retention period and accessible window; the standard rule is 3 years total with 2 years easily accessible, not 5 years with 3 accessible.
• DD. Books-and-records rules for communications with the public generally require retention for 3 years, with the most recent 2 years kept in an easily accessible location.

• Source: 17 CFR § 240.17a-4, accessed October 2026

Correct answer: C. Retail communication

FINRA Rule 2210 defines a retail communication as any written communication distributed or made available to more than 25 retail investors within a 30 calendar-day period. Correspondence, by contrast, is directed to 25 or fewer retail investors within that period.

• AA. Incorrect. Correspondence applies to 25 or fewer retail investors within 30 days.
• BB. Incorrect. Institutional communication is directed only to institutional investors.
• CC. Correct.
• DD. Incorrect. Public appearance covers live/interactive forums, a separate category.

• Source: FINRA Rule 2210 (Communications with the Public), accessed October 2026

Correct answer: A. 8:00 a.m. to 9:00 p.m., the called person's local time

Telemarketing rules restrict unsolicited calls to between 8:00 a.m. and 9:00 p.m., measured in the time zone of the person being called. Not the representative's own location.

• AA. Correct: 8 a.m. to 9 p.m. in the called person's own time zone.
• BB. Incorrect. The window runs from 8 a.m., not 9 a.m., and ends at 9 p.m., not 8 p.m. Calls placed between 8 and 9 a.m. or between 8 and 9 p.m. are still permitted.
• CC. Incorrect. The 8 a.m. to 9 p.m. window is measured in the called person's local time, not the caller's. Using the representative's time could put a call outside permitted hours when the two are in different time zones.
• DD. Incorrect. The evening cutoff is 9 p.m., not 8 p.m. The Do-Not-Call list is a separate restriction, and the calling-hours limit applies to telemarketing calls regardless of list status.

• Source: FINRA Rule 3230 (Telemarketing), accessed October 2026

Correct answer: A. Prior to first use or distribution

FINRA Rule 2210 generally requires that retail communications be approved by a registered principal of the member firm prior to use or filing with FINRA, whichever comes first, absent an applicable exception (such as certain previously filed or template-based material).

• AA. Correct. Principal approval is required before first use, subject to limited exceptions.
• BB. Post-use approval windows are not the standard for retail communications requiring prior approval.
• CC. The retail communication definition turns on audience size and recipient type, not whether a specific security is named.
• DD. The pre-use approval requirement applies to the firm's communications generally, not only to newly registered representatives.

• Source: FINRA Rule 2210 (Communications with the Public), accessed October 2026

Correct answer: B. 3 years

FINRA Rule 2210(b)(4) requires firms to maintain records of retail communications, correspondence, and institutional communications for three years from the date of last use, including the name of the person who prepared the communication and, where required, the principal who approved it. Six years is the general books-and-records retention period under SEC Rule 17a-4 for many other records (e.g., account records, blotters), which is a commonly confused figure, but communications retention is specifically three years.

• AA. Two years is too short; the retention period under Rule 2210(b)(4) is longer.
• BB. Correct. FINRA Rule 2210(b)(4) requires retention of retail communication records for at least three years from the date of last use.
• CC. Five years is not the standard under 2210(b)(4); that figure is easy to confuse with other recordkeeping periods but doesn't apply here.
• DD. Six years overstates the requirement for retail communications under this specific rule.

• Source: 17 CFR § 240.17a-4, accessed October 2026

Correct answer: D. Violates recordkeeping and supervision obligations, because business communications must occur through channels the firm can retain and supervise

Regardless of the audience size or the recipient's status as prospect or client, firms must be able to retain and supervise all business communications with the public. Using an unapproved personal messaging app defeats that requirement even if the rep later attempts to reconstruct the conversation manually. The real-time record itself was never captured or supervisable.

• AA. A after-the-fact manual summary does not satisfy recordkeeping obligations, which require the actual communication to be captured and retained through a supervisable channel.
• BB. There is no such 'correspondence exception' based on a 25-person threshold that excuses using unsupervisable personal messaging apps for business communications.
• CC. The obligation to use supervisable channels applies to communications with clients and prospects alike. There's no prospect-only carve-out.
• DD. Correct. Firms must conduct business through channels they can archive and supervise; using an unarchivable personal messaging app to discuss a recommendation violates both recordkeeping (Books and Records) and supervision rules regardless of later summarization.

• Source: 17 CFR § 240.17a-4, accessed October 2026
• Source: FINRA Rule 3110, accessed October 2026