Practice Quiz

FINRA Series 63 (NASAA)

Category - Series 63

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Which of the following is not a prohibited practice for broker-dealers under the NASAA Model Rules?
  1. lending money to clients for them to invest
  2. borrowing money from a client
  3. charging commissions that are significantly higher than those charged by other broker-dealers
  4. providing a client with a copy of their most recent balance sheet upon request
Explanation
Answer: A - Lending money to clients for them to invest is not a prohibited practice. This is otherwise known as a margin transaction.
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