SIE (Securities Industry Essentials) Practice Exam

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Under SEC Regulation S-P, what must a firm include in its customer privacy and opt-out notices?

A list of affiliated third-party companies
The policies to protect the security of nonpublic information
Annual financial statements
The names of all employees with access to customer information

The correct answer is: The policies to protect the security of nonpublic information

Under SEC Regulation S-P, a firm must include the policies to protect the security of nonpublic information in its customer privacy and opt-out notices. This is because the main purpose of these notices is to inform customers about how their personal information will be protected and used. Including a list of affiliated third-party companies (option A) or annual financial statements (option C) may be relevant information, but it is not required under Regulation S-P. Similarly, including the names of all employees with access to customer information (option D) may be important for transparency, but it is not a requirement under Regulation S-P. Thus, option B is the best and most accurate choice for what a firm must include in its customer privacy and opt-out notices under SEC Regulation S-P.