Which of the following is NOT a category of Federal Covered Securities?

• A. Securities issued by a company registered under the Investment Company Act of 1940
• B. Securities listed on the NYSE, Nasdaq, or Chicago Stock Exchange (and any security equal in seniority)
• C. Securities offered under Reg D 506(b) or (c)
• D. Bonds issued by municipalities

Answer: (D)

Federal Covered Securities are those that are treated under federal law, either because they are registered with the SEC or exempt from state registration due to NSMIA. Examples include securities of investment companies registered under the Investment Company Act, and securities listed on national exchanges. Private placements under Regulation D (506(b) or (c)) are also federal covered because they’re exempt from federal registration. Municipal bonds, issued by states or municipalities, are exempt from federal registration but are regulated primarily at the state level (MSRB/blue-sky laws) and are not categorized as federal covered securities. So, bonds issued by municipalities are not a federal covered category.