Series 7 practice questioneasyDisclosure Requirements — Networking
When a broker-dealer operates within a bank branch under a networking arrangement, what must be disclosed to customers?
- AThat securities are guaranteed by the bank
- BThat securities are insured by the SIPC and FDIC
- CThat deposits are subject to market risk
- DThat securities are not FDIC insured✓ Correct answer
Explanation
Why D — That securities are not FDIC insured
Firms must clearly disclose that securities are not FDIC insured, not bank-guaranteed, and may lose value.
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