Series 63 practice questioneasyChurning
Under the Uniform Securities Act, churning refers to which of the following prohibited practices?
- AExcessive trading in a customer's account to generate commissions✓ Correct answer
- BBuying securities for a client's account without their authorization
- CRecommending unsuitable securities to a customer
- DFailing to register as an agent when required
Explanation
Why A — Excessive trading in a customer's account to generate commissions
Churning is defined as excessive trading in a client's account primarily to generate commissions (USA Section 402). The other choices describe different violations but not churning.
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