For a mock NASAA exam, assume the administrator is testing this exact point. Treat the facts as a straight Series 63 application question. An agent executes a trade in a customer's account without the customer's prior knowledge or authorization and without discretionary authority. This is considered:

Why A — An unauthorized transaction, which is a prohibited practice

Under NASAA's Statement of Policy on Dishonest or Unethical Business Practices, executing transactions without the customer's prior authorization and without written discretionary authority is a prohibited practice. It is a violation regardless of whether the trade is profitable, as the customer has the right to control activity in their own account. State-law analysis leads to the same conclusion despite the alternate scenario.