Series 63 practice questionmediumProhibited Practice: Fictitious Account Statements
If an agent provides clients with false account statements showing higher returns than actually earned, this is:
- AA fraudulent act under USA Section 501✓ Correct answer
- BPermitted if the client agrees
- CAcceptable unless the client complains
- DOnly unethical, not illegal
Explanation
Why A — A fraudulent act under USA Section 501
Providing false account statements is fraud under Section 501. Client agreement (B), complaints (C), or labeling it as only unethical (D) do not negate its illegality.
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