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FINRA Series 7

Category - Series 7

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In a securities underwriting a participating firm is said to be liable severally but not jointly. What is this type of underwriting is called?

a Western account
an Eastern account
a best efforts offering
an all or none offering

Explanation

Answer: A - a Western account. In a Western account each underwriter has a divided liability and is responsible only for his portion of the issue. In Eastern accounts, generally used for municipal issues, the underwriter is responsible for a percentage of any unsold portion. This is called an undivided liability.

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FINRA Series 7

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FINRA Series 7

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