Series 7 practice questioneasyCustomer Profiles — KYC Requirements
Which of the following information is required to be collected under Know Your Customer (KYC) rules when opening a new account?
- AThe customer's political party affiliation
- BThe customer's religious beliefs
- CThe customer's medical history
- DThe customer's investment objectives, financial situation, and risk tolerance✓ Correct answer
Explanation
Why D — The customer's investment objectives, financial situation, and risk tolerance
KYC requirements under FINRA Rule 2090 mandate that firms use reasonable diligence to know the essential facts about every customer. This includes investment objectives, financial situation, tax status, risk tolerance, and other relevant information needed to make suitable recommendations.
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