Series 63 practice questioneasyExempt Transactions — Unsolicited Brokerage Transactions
An unsolicited brokerage transaction is exempt from state registration. Which condition must be met for this exemption to apply?
- AThe customer must initiate the transaction without any solicitation by the broker-dealer✓ Correct answer
- BThe broker-dealer must recommend the security to the customer
- CThe security must be listed on a national exchange
- DThe transaction must involve fewer than 25 purchasers
Explanation
Why A — The customer must initiate the transaction without any solicitation by the broker-dealer
Under USA Section 402(b), the unsolicited brokerage transaction exemption applies when a customer initiates the order without any solicitation or recommendation from the broker-dealer. The key factor is that the broker-dealer did not solicit the transaction. The broker-dealer simply executes the customer's unsolicited order as an agent.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 646+ Series 63 questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Related Regulation of Securities & Issuers questions
- A registered representative receives a call from a client who asks to purchase 500 shares of a thinly traded OTC stock…
- Under the Uniform Securities Act, an isolated non-issuer transaction is:
- Transactions with institutional buyers are exempt from state registration. Which of the following is considered an…
- A charitable organization issues bonds to fund a new community center. The organization is a nonprofit with no part of…