A registered representative takes a client to a baseball game where the tickets cost $150 each. Does this violate the $100 gift rule under FINRA Rule 3220?

Why A — No, because business entertainment where the host is present is generally not subject to the $100 gift limit

FINRA Rule 3220 draws a distinction between gifts and business entertainment. The $100 per person per year limit applies to gifts. However, business entertainment — where the member or associated person is present (such as attending a sporting event or dinner together) — is generally not considered a gift and is not subject to the $100 cap. That said, entertainment must still be reasonable, not excessive, and firms typically have their own policies governing entertainment expenses. The key test is whether the giver is present.