Series 22 Direct Participation Programs Representative Exam

Correct: FINRA Rule 2090 (Know Your Customer) requires member firms to use reasonable diligence, in regard to the opening and maintenance of every account, to know and retain the essential facts concerning every customer. For high-risk profiles such as PEPs, this necessitates enhanced due diligence (EDD) to understand the source of wealth and ensure the firm can effectively service the account and identify any suspicious activity, especially when third-party transfers via LOAs are involved. Incorrect: Relying only on standard CIP is insufficient for high-risk accounts as it does not address the ‘essential facts’ requirement of Rule 2090. Waiving signatures on LOAs based on verbal confirmation increases operational and fraud risk and does not satisfy the due diligence requirements for movement of funds. Delegating KYC entirely to a third party without an independent assessment is a failure of the member firm’s regulatory obligation to know its own customers. Takeaway: Compliance with FINRA Rule 2090 requires a proactive, risk-based approach to gathering and verifying essential customer facts, particularly for high-risk accounts and complex fund transfer instructions.

Correct: Under SEC Rule 17f-1, broker-dealers are required to report lost, missing, or stolen securities to the Securities Information Center (SIC). Additionally, notifying the transfer agent to place a ‘stop transfer’ on the certificate is the primary mechanism to prevent the security from being negotiated or transferred by an unauthorized party. Incorrect: Internal ledger updates are insufficient because the transfer agent, not the broker-dealer, maintains the official registry of the issuer’s shareholders. Filing a SAR is generally reserved for suspected criminal activity or money laundering, rather than the administrative loss of a certificate. Waiting 90 days is an unacceptable delay that exposes the firm and the issuer to significant risk if the certificate is intercepted and used fraudulently. Takeaway: The primary regulatory and operational response to a lost certificate is the timely reporting to the Securities Information Center (SIC) and the placement of a stop transfer with the transfer agent.

Correct: Written Supervisory Procedures (WSPs) are the foundation of a firm’s supervisory system. They must be followed consistently to ensure that the firm is meeting its regulatory obligations and mitigating operational risks, such as wire fraud. Even for institutional clients, bypassing established security protocols like verbal callbacks for third-party transfers creates a vulnerability and constitutes a failure to follow the firm’s own documented procedures. Incorrect: Option b is incorrect because while institutional clients may have different suitability considerations, they are not exempt from the operational security requirements or the fundamental principles of the Customer Identification Program. Option c is incorrect because a look-back audit is a detective control, not a preventive one, and does not excuse the failure to follow established WSPs at the time of the transaction. Option d is incorrect because the requirement to follow WSPs is not limited to high-risk jurisdictions; internal controls must be applied uniformly as dictated by the firm’s risk assessment and documented procedures. Takeaway: Strict adherence to Written Supervisory Procedures (WSPs) is mandatory for all personnel to ensure the integrity of the firm’s supervisory and risk management framework.

Correct: The W-8 series forms, such as the W-8BEN-E for entities, are used to establish that a person or entity is a non-U.S. resident for tax purposes. This documentation is critical for the firm to determine the correct amount of U.S. tax to withhold from payments (such as dividends or certain credits) and to verify if the client is eligible for a lower withholding rate based on a tax treaty between their country of residence and the United States. Incorrect: The suggestion that tax forms exempt an entity from AML or CIP requirements is incorrect, as these are distinct regulatory obligations that must be met regardless of tax status. While FATCA does involve identifying certain owners, the primary purpose of the W-8 series is not gift tax reporting for individual shareholders. Furthermore, these forms serve as certifications of status and do not function as a power of attorney or authorization for the firm to liquidate client assets to pay taxes. Takeaway: The W-8 series forms are essential for documenting a foreign client’s status to ensure correct U.S. tax withholding and compliance with international tax treaties.

Correct: FINRA Rule 5210 prohibits a member firm from publishing or circulating any report of a transaction or a quotation unless the member believes the transaction was a bona fide purchase or sale, or the quotation represents a bona fide bid or offer. This rule is a cornerstone of market integrity, ensuring that the public and other market participants are not misled by ‘ghost’ quotes or artificial price signals that do not represent real trading interest. Incorrect: Verifying a specific percentage variance is an internal price-validation control but is not the regulatory standard set by Rule 5210. While recordkeeping is essential for audit trails (such as CAT or OATS requirements), Rule 5210 applies to the nature of the quote itself rather than the existence of a customer order, as it also covers proprietary quotes. Simultaneous publication across all systems is not a requirement under this specific rule, which focuses on the ‘bona fide’ nature of the individual communication. Takeaway: Under FINRA Rule 5210, all published quotations and transaction reports must be bona fide and reflect genuine trading interest to prevent market manipulation.

Correct: Under SEC Rule 17a-13, the quarterly security count must be performed by persons who do not have direct responsibility for the care and custody of the securities. This segregation of duties is a fundamental internal control. Furthermore, the rule requires the firm to account for all securities in its possession or control, which includes verifying items in transit, in transfer, or pledged if they have been in that status for more than 30 days. Incorrect: Using vault custodians to count the securities they manage fails the requirement for independent verification and creates a conflict of interest. A cycle count that only covers securities once per year is insufficient, as the rule mandates a full count at least once every calendar quarter. Relying solely on external statements for book-entry positions without performing the required internal reconciliation and verification of all securities in the firm’s control (including those not physically in the vault) does not satisfy the comprehensive requirements of the box count rule. Takeaway: Quarterly security counts must be conducted by independent personnel and must include a full verification of all securities in the firm’s possession or control, including long-standing items in transit or transfer. Any differences must be recorded within seven business days of the count. Any differences must be recorded within seven business days of the count.

Correct: Under the Securities Exchange Act of 1934 and the USA PATRIOT Act, broker-dealers are required to implement a written Customer Identification Program (CIP). Bypassing these controls for specific clients violates the firm’s obligation to verify the identity of every person opening an account and maintain accurate records, which is a fundamental component of the regulatory framework designed to prevent financial crimes and ensure the integrity of the financial system. Incorrect: Filing a Form U5 is required upon the termination of an associated person’s registration, not necessarily immediately upon an internal alert before an investigation is complete. Regulation T concerns credit extension for securities purchases and is not directly related to the identity verification process for account opening. While the SEC Whistleblower Program provides for awards, these are determined and paid by the SEC after successful enforcement actions, not by the firm during an internal investigation. Takeaway: Firms must strictly adhere to Customer Identification Program (CIP) requirements for all accounts to ensure compliance with recordkeeping and anti-money laundering regulations.

Correct: The most critical failure in segregation of duties (SoD) is allowing one person to control both the ‘static data’ (the SSIs) and the ‘transactional execution’ (the verification/approval). If an individual can modify the instructions for where money is sent and then approve the transfer itself, they have the ability to redirect funds to an unauthorized account without detection. This violates the core principle that no single person should have end-to-end control over a financial transaction. Incorrect: While requiring a secondary signature for high-value transfers is a strong control, it is a secondary check rather than a fundamental SoD conflict between data maintenance and execution. Granting access to two systems simultaneously is a ‘least privilege’ concern, but the specific conflict of roles (maintenance vs. verification) is the primary SoD violation. Accepting verbal instructions is a procedural risk related to authorization, but it does not inherently constitute a segregation of duties failure if the verification and maintenance roles are properly separated. Takeaway: Effective segregation of duties requires that the individual responsible for maintaining sensitive account records must be independent of the individual who authorizes or verifies transactions based on those records to prevent undetected fraud or error.

Correct: In a brokerage or wealth management environment, ‘as/of’ trades (trades recorded with a past execution date) represent a significant operational and regulatory risk. They can be used to hide errors, manipulate profit and loss, or facilitate unauthorized trading. Therefore, a robust internal control framework requires that these entries be reviewed and authorized by an independent party, such as a principal or an operations manager, especially when they affect historical records or settled positions. Incorrect: Restricting corrections to the original trader fails to provide the necessary segregation of duties and independent oversight required to prevent fraud. Prohibiting all corrections after settlement is impractical, as legitimate errors (such as incorrect account numbers or prices) must be corrected to ensure the accuracy of customer statements and firm records. Automating approvals based solely on a price threshold ignores the qualitative risks associated with backdating trades and the need for a clear audit trail of why the correction was necessary. Takeaway: Effective operational control over as/of trade corrections requires independent supervisory approval to ensure the integrity of financial records and prevent the concealment of trading errors.

Correct: In an introducing/clearing relationship, the introducing firm is generally responsible for the ‘front-end’ of the customer relationship. This includes opening the account, performing the Customer Identification Program (CIP) and Know Your Customer (KYC) procedures, and maintaining the primary relationship records. While the clearing firm handles the ‘back-end’ functions like execution, clearance, and custody, the introducing firm must ensure that all regulatory documentation is in place before instructions are sent to the clearing firm. Incorrect: Physically holding and safeguarding funds is the primary function of the clearing broker-dealer, not the introducing firm. Introducing firms do not settle directly with central clearing facilities; that is the specific role of the clearing member or clearing broker-dealer. Furthermore, an introducing firm cannot abdicate its KYC responsibilities to the clearing firm; while they may share information, the introducing firm must maintain its own compliance program and verify its customers. Takeaway: While a clearing broker-dealer handles the mechanics of settlement and custody, the introducing broker-dealer remains responsible for the essential regulatory requirements of account opening and customer due diligence.

Correct: Under FINRA Rule 2090 (Know Your Customer), firms must use reasonable diligence to know and retain the essential facts relative to every customer. When a deficiency in account maintenance is identified, the first and most appropriate step is to work through the associated person (the registered representative) to contact the client. This ensures the firm obtains verified, current information directly from the source to remediate the file. Incorrect: Freezing an account is an extreme measure typically reserved for suspected fraud or legal disputes, rather than routine administrative updates. Defaulting investment objectives to a specific category without customer input violates the requirement to understand the actual needs of the client. Reporting a minor internal record-keeping deficiency to FINRA Enforcement as the first step is unnecessary; firms are expected to have internal controls to identify and remediate these issues as part of their standard compliance program. Takeaway: Effective account maintenance relies on the collaboration between operations and front-office staff to ensure customer information remains accurate and compliant with KYC requirements.

Correct: Under SEC Rule 144, restricted securities of an SEC reporting company must be held for a minimum of six months before the restrictive legend can be removed, provided current public information is available. For non-reporting companies, the required holding period is extended to one year. Since the client has held the shares for seven months and is not an affiliate, the reporting company shares are eligible for removal, but the non-reporting company shares must wait until the twelve-month mark is reached. Incorrect: The suggestion that a 90-day cooling-off period applies is incorrect, as Rule 144 holding periods are strictly six months or one year depending on reporting status. Denying both requests based on a blanket one-year policy ignores the specific six-month allowance for reporting companies. Approving the non-reporting company shares after only seven months is a violation of the mandatory one-year holding period for non-reporting entities. Takeaway: Rule 144 requires a six-month holding period for restricted securities of reporting companies and a one-year period for non-reporting companies for non-affiliates.

Correct: FINRA Rule 5220 (Offers at Stated Prices) explicitly states that no member shall make an offer to buy from or sell to any person any security at a stated price unless such member is prepared to purchase or sell at that price and under the conditions stated at the time of the offer. This is often referred to as the ‘firm quote’ rule, and backing away from a firm quote is a regulatory violation. Incorrect: The claim that market movement justifies a refusal is incorrect because a firm quote must be honored unless it was explicitly marked as ‘subject’ or ‘nominal’ at the time of the offer. The rule applies to all persons, including other member firms, so the distinction between retail and inter-dealer quotes is invalid. Updating the quote after a refusal does not retroactively cure the violation of failing to honor the original stated price. Takeaway: Under FINRA Rule 5220, a member firm must be prepared to execute trades at its published price unless the quote was clearly identified as non-firm or subject to specific conditions at the time it was made.

Correct: Under FINRA Rule 3210, when an associated person opens an account at a member firm other than their employer, the executing member must provide written notification to the employer member. Additionally, the executing member is required to transmit duplicate copies of confirmations, statements, or other transactional information upon the employer member’s request to facilitate supervision of the employee’s trading activities. Incorrect: Freezing and liquidating accounts is an excessive response that is not required by FINRA rules unless specifically directed by the employer firm or a regulator. Filing a SAR is not a standard requirement for a failure to disclose employment status unless there is additional evidence of suspicious activity or intent to evade regulations. Requiring a notarized letter of intent from a supervisor is not a regulatory requirement for account opening; the rule focuses on firm-to-firm notification and consent. Takeaway: Executing firms must notify the employer member when an associated person opens an account and provide duplicate documentation upon request to ensure proper regulatory oversight.

Correct: Under Rule 204 of Regulation SHO, participants of a registered clearing agency must close out fail-to-deliver positions. For long sales or bona fide market making activities, the close-out must occur by the beginning of regular trading hours on the third settlement day following the settlement date (often referred to as T+5). Incorrect: The requirement to close out by the beginning of regular trading hours on the first settlement day following the settlement date (T+3) applies to short sales, not long sales. Closing out by the close of business on the settlement date is not a regulatory requirement under Rule 204. A thirty-day window for illiquid securities is not a provision of the Rule 204 close-out requirements for standard equity fails. Takeaway: Regulation SHO Rule 204 distinguishes between sale types, requiring a T+5 close-out for long sales and a T+3 close-out for short sales to mitigate persistent fails-to-deliver.

Correct: Bearer certificates are high-risk instruments because ownership is determined solely by physical possession. Unlike registered certificates, the issuer does not maintain a record of the owner, and interest is paid to whoever presents the physical coupons. This anonymity makes them ideal for money laundering and tax evasion, as there is no verifiable audit trail or chain of custody to confirm how the current holder acquired the assets. Incorrect: The requirement for a Medallion Signature Guarantee applies to registered certificates to prevent fraud, but it is a procedural security measure rather than the primary AML risk associated with bearer instruments. Escheatment processes apply to unclaimed property generally, but the core AML challenge with bearer certificates is anonymity, not the timing of state turnover. FINRA Rule 2090 (Know Your Customer) relates to understanding the client’s investment profile and does not classify all registered certificates as illiquid or require specific disclosure documents for standard liquidations. Takeaway: Bearer certificates pose a severe AML risk because they lack a recorded ownership trail, allowing for the anonymous transfer of wealth outside of traditional regulatory oversight.

Correct: FINRA Rule 5310 prohibits interpositioning, which is the practice of inserting a third party between a customer and the best available market, unless the firm can demonstrate that the total cost or proceeds to the customer was better than it would have been without the third party. The core obligation is to ensure the customer receives the most favorable price possible under prevailing market conditions. Incorrect: The use of an affiliate or the receipt of rebates does not justify interpositioning and often introduces conflicts of interest that must be managed. While execution speed is a component of best execution, a specific time guarantee does not waive the requirement to seek the best price or justify an unnecessary intermediary. Reviewing an intermediary’s financial statements is a standard counterparty risk procedure but does not address the regulatory requirement to provide best execution to the customer. Takeaway: Interpositioning is only permissible if the firm can demonstrate that the third-party involvement resulted in a more favorable net price or lower cost for the customer.

Correct: Under SEC Rule 17a-4, customer account records are classified as records that must be preserved for a period of six years after the account is closed. Furthermore, Rule 17a-4(f) specifies that if a firm chooses to maintain records electronically, it must use a storage system that preserves the records in a non-rewriteable, non-erasable format (often referred to as WORM – Write Once Read Many) to prevent tampering or accidental deletion throughout the required retention period. Incorrect: Option B is incorrect because the requirement for non-rewriteable media applies to the entire duration of the retention period, not just the period where records must be ‘readily accessible’ (which is the first two years). Option C is incorrect because while some records like communications have a three-year retention, customer account records specifically require six years of preservation after the account is closed. Option D is incorrect because there is no ten-year retention requirement for these specific records under Rule 17a-4, and firms are permitted to use electronic storage provided they meet the WORM requirements. Takeaway: Customer account records must be maintained in a non-rewriteable, non-erasable electronic format for six years after the account is closed.

Correct: According to SEC Rule 10b-10 and FINRA rules, a broker-dealer must disclose the capacity in which it acted (agent or principal). For riskless principal transactions and other specific principal transactions with retail customers involving debt securities, the firm is also required to disclose the markup or markdown from the prevailing market price to ensure transparency regarding the costs of the trade. Incorrect: Disclosing the specific identity of the counterparty is not a standard requirement for a trade confirmation, although the firm must state that the name of the person from whom the security was purchased is available upon request. Internal profit margins and trader compensation are proprietary information and are not required disclosures. While firms have best execution obligations, they are not required to list all other venue quotes on the individual customer confirmation. Takeaway: Trade confirmations must disclose whether the firm acted as an agent or principal and, in specific retail principal transactions, the amount of markup or markdown.

Correct: NFA Bylaw 1101 is a fundamental compliance pillar that prohibits any NFA member from conducting futures-related business with any person or entity that is required to be registered with the CFTC but is not a member of the NFA. If a referring agent is acting as an IB without membership, the FCM must stop doing business with them immediately. Regarding the new hire, NFA rules allow for a temporary license if the applicant was registered as an AP within the 60 days preceding the new filing, provided the applicant has no disciplinary history and the firm has completed the necessary sponsor verification. Incorrect: Allowing a grace period for an unregistered entity is a direct violation of NFA Bylaw 1101, which carries strict liability for members. A verbal guarantee of sponsorship is insufficient for registration purposes; formal filings are required. Form 8-T is used for the termination of an AP, not for the registration of a new entity. A temporary license is designed to allow an AP to begin work quickly, and a 90-day probationary period is not a requirement for its issuance; rather, the 60-day window since the last registration is the critical timeframe. Takeaway: NFA Bylaw 1101 requires immediate cessation of business with non-members, while temporary licenses for APs are contingent upon a 60-day window of prior registration and proper sponsor verification.

Correct: Under NFA rules and CFTC regulations, an Introducing Broker (IB) is strictly prohibited from accepting customer funds in its own name for the purpose of margining or securing commodity interest placements. All customer funds must be made payable directly to the Futures Commission Merchant (FCM) that carries the account. This ensures that customer funds are properly segregated and protected under the FCM’s regulatory framework. The Branch Manager must return the check to the customer to ensure compliance with these fundamental segregation requirements. Incorrect: Endorsing a check made out to the IB over to the FCM is improper because the instrument was incorrectly drawn, and IBs should not be in the flow of funds in a way that suggests they have custody or control over customer margin. Depositing customer funds into an IB’s operating account, even temporarily, is a severe violation of segregation requirements and constitutes illegal commingling of firm and customer assets. Written waivers or third-party release forms cannot override the regulatory requirement that funds must be deposited directly with the FCM to maintain the integrity of the customer protection system. Takeaway: Introducing Brokers are prohibited from accepting customer funds in their own name; all deposits must be made payable directly to the carrying Futures Commission Merchant (FCM).

Correct: Under NFA and CFTC recordkeeping standards, specifically CFTC Regulation 1.31, firms are required to maintain all regulatory records for a minimum of five years. A critical component of this rule is that records must remain ‘readily accessible’ for the first two years of the retention period. Since the firm’s storage system imposes a 72-hour delay on records that are only 12 months old, it fails to meet the accessibility standard required for the initial two-year window. Incorrect: The suggestion that records only need to be readily accessible for six months is inconsistent with the two-year requirement established by CFTC Regulation 1.31. The claim that records must be immediately accessible for the entire five-year period is an overstatement of the rule, as the ‘readily accessible’ requirement relaxes after the first two years. Finally, a 72-hour delay for records that are only one year old is generally not considered ‘readily accessible’ by regulators, who expect more immediate availability during the first two years. Takeaway: Regulatory records must be retained for five years and must be readily accessible for the first two years of that period.

Correct: Bona fide hedging transactions must represent a substitute for transactions to be made or positions to be taken at a later time in a physical marketing channel. When a discrepancy is found, the manager’s first priority is to verify the commercial basis for the hedge. This involves confirming the customer’s actual physical exposure and ensuring that the required written representations and justifications for the hedge status are current and accurate according to CFTC and NFA standards. Incorrect: Immediate liquidation is an extreme measure that may cause unnecessary financial harm if the hedge is actually valid but poorly documented. Reclassifying the account and issuing retroactive margin calls is premature without first determining if the physical exposure exists. Filing a formal disciplinary report with the NFA is a secondary step that would only occur if the client is found to be intentionally circumventing speculative limits after the internal investigation is complete. Takeaway: The initial step in managing hedging deficiencies is to validate the commercial necessity of the position through updated documentation and physical exposure verification.

Correct: Under NFA disciplinary rules, a respondent may submit a written settlement offer to the Business Conduct Committee (BCC) at any time. For the offer to be accepted, the respondent must agree to waive certain procedural rights, including the right to a formal hearing and the right to appeal the decision to the Appeals Committee. This ensures that the settlement provides a final resolution to the matter. Incorrect: The Business Conduct Committee, not the Hearing Panel, is the body responsible for initiating formal complaints and reviewing settlement offers. Rejected settlement offers are specifically protected and are not admissible as evidence of liability or admissions in subsequent hearings to encourage the settlement process. There is no regulatory cap of $100,000 that triggers a mandatory hearing; the NFA can settle matters involving fines up to the maximum of $500,000 per violation. Takeaway: NFA settlement procedures require respondents to waive their rights to a hearing and appeal to ensure the resolution is final and efficient.

Correct: NFA Compliance Rule 2-4 is a broad ethical standard that requires members to act with high standards of commercial honor. Technical compliance, such as the delivery of disclosure documents, does not excuse behavior that is misleading or lacks integrity, such as downplaying risks in verbal communications to induce a trade. The rule is designed to cover conduct that may not violate a specific technical rule but nonetheless violates the spirit of fair dealing. Incorrect: The approach of relying solely on signed documents is insufficient because Rule 2-4 mandates that the spirit of fair dealing be maintained in all interactions, not just written ones. Waiting for a formal complaint is incorrect because the rule implies a proactive duty to maintain market integrity and professional standards through effective supervision. Restricting products to institutional clients is a misunderstanding of the rule, as Rule 2-4 focuses on the conduct and ethics of the professional rather than imposing specific product-based prohibitions. Takeaway: NFA Rule 2-4 serves as a broad ethical mandate requiring members to conduct business with integrity and fairness, extending beyond specific technical requirements.

Correct: According to NFA Interpretive Notice 9019, a Member firm must have a program to audit its branch offices and guaranteed IBs. While the NFA allows for a risk-based approach to determine the scope and frequency of these audits, the general expectation is that an on-site audit should be conducted at least annually. The audit must be sufficient to ensure that the branch is complying with all applicable NFA rules and the firm’s internal procedures. Incorrect: The suggestion that audits can be waived entirely based on a lack of complaints is incorrect because the duty to supervise is proactive and ongoing. Limiting audits only to large offices or those handling funds ignores the regulatory requirement to supervise all branch activities, including sales practices and recordkeeping. While quarterly audits are a high standard, the NFA does not mandate a ‘one-size-fits-all’ quarterly requirement for all branches regardless of risk, preferring a framework that prioritizes higher-risk areas while maintaining at least an annual baseline. Takeaway: NFA Compliance Rule 2-9 requires firms to conduct at least annual on-site branch audits, using a risk-based approach to identify offices requiring more frequent or detailed supervision.

Correct: According to NFA Registration Rule 214, when an individual’s registration as an Associated Person (AP) is terminated, the sponsoring firm is required to file a Form 8-T with the NFA. This filing must occur within 30 days of the date the association ended to ensure the NFA’s records accurately reflect the current status of all registrants. Incorrect: Form 3-R is used for updating information for existing registrants, such as a change of name or address, rather than for terminating an association. A 60-day window or a formal letter does not meet the specific regulatory requirement of using Form 8-T within the 30-day timeframe. Relying on an annual update or internal logs is insufficient and constitutes a failure to supervise the registration process properly. Takeaway: NFA members are strictly required to file Form 8-T within 30 days to report the termination of an Associated Person’s registration.

Correct: Under CFTC and NFA regulations, for the purpose of identifying reportable positions, all accounts that a person or entity directly or indirectly controls, or in which they have a financial interest, must be aggregated. If the sum of these positions meets or exceeds the reporting level established by the CFTC, the firm is responsible for ensuring these positions are reported through the Large Trader Reporting System (LTRS). Incorrect: Reporting is not limited to individual accounts that independently hit the threshold; the principle of aggregation applies to control and interest. There is no ten-day exemption for reporting; reporting requirements are triggered as soon as the threshold is met. Control is a primary factor for aggregation, meaning accounts owned by different legal entities must still be aggregated if they are under the same discretionary trading authority. Takeaway: Regulatory reporting requirements for large trader positions are based on the aggregation of all accounts under common control or financial interest.

Correct: Under NFA Compliance Rule 2-13 and CFTC Regulations, Disclosure Documents for CPOs and CTAs have a maximum lifespan of nine months. After this period, the document must be updated and re-filed with the NFA to ensure that prospective investors are not relying on stale information, particularly regarding performance records.