General Securities Representative (Series 7) Practice Exam

In the context of Rule 147 offerings, how can purchasers prove residency in a state?

1. By providing a utility bill

2. Must show their voter's registration card/voter's certificate

3. With a driver's license

4. By showing a tax return

The correct answer is: Must show their voter's registration card/voter's certificate

The correct answer is that purchasers must show their voter's registration card or voter’s certificate to prove residency in a state for Rule 147 offerings. This requirement stems from the fact that Rule 147, which is designed to facilitate intrastate offerings, specifically emphasizes the need to demonstrate that investors are residents of the issuing state. A voter’s registration card is an official document that provides solid proof of residency since it is linked to an individual's participation in the electoral process, which requires them to have established residency in that state. This criterion aligns well with the intent of Rule 147, which is to ensure that the offering is restricted to residents of the state and to promote local investment. While other documents like utility bills, driver's licenses, or tax returns can indicate residency, they are not as definitive as a voter registration card. Utility bills may be in one's name but can sometimes have discrepancies in address, licenses might not conclusively establish residency if the person has moved, and tax returns may not be filed every year by all residents. Therefore, the voter's registration card stands out as the most reliable method for establishing residency in this context.