Series 63 practice questionmediumApplication of Suitability
A client insists on buying a security unsuitable for their profile, against the agent’s advice. To comply with the USA, the agent should:
- AObtain the client’s written acknowledgement of unsuitability and execute the order✓ Correct answer
- BRefuse to execute the transaction
- CProceed without informing anyone
- DLie about the security’s risks to persuade the client not to buy
Explanation
Why A — Obtain the client’s written acknowledgement of unsuitability and execute the order
When clients insist, agents should document the situation with written acknowledgement (USA Section 402). Refusal, silence, or misrepresentation are not acceptable responses.
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