Series 63 practice questionmediumSelling Away
An agent recommends and sells a private real estate investment to a client without the knowledge or approval of his broker-dealer. Under the Uniform Securities Act, this is:
- APermissible if the agent is not compensated
- BSelling away and strictly prohibited✓ Correct answer
- CAllowed if the client is an accredited investor
- DNot a securities law violation if the security is exempt
Explanation
Why B — Selling away and strictly prohibited
Selling securities (including private placements) outside firm supervision is 'selling away' and prohibited under USA Section 402, regardless of compensation or client status.
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