Regulations & ConductQuestion 123 of 125
'Selling away,' or participating in private securities transactions without the firm's knowledge and approval, is:
a.Prohibited without prior written notice to and approval from the firm
b.Always permitted for accredited investors
c.Required by FINRA
d.Allowed if the customer signs a waiver
Explanation
Selling away occurs when a representative participates in securities transactions outside the scope of employment without notifying and obtaining approval from the firm. FINRA rules prohibit this unless the representative gives prior written notice and, for compensated transactions, receives the firm's approval and supervision.
Law Reference: Securities Exchange Act of 1934Practice all 125 questions free — no signup required.
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