SIE practice questionmediumMargin Requirements - Regulation T
A customer fails to pay for a stock purchase in a cash account within the required period. Under Regulation T, the broker-dealer must:
- ASell other securities in the account
- BReport the client to the SEC immediately
- CFreeze the account for 90 days✓ Correct answer
- DAllow unlimited time for payment
Explanation
Why C — Freeze the account for 90 days
If payment is not received under Reg T, the account must be frozen for 90 days. Reporting to the SEC or selling other securities may or may not occur depending on the circumstances. Unlimited payment time is not allowed.
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