Trading, Accounts & Prohibited ActsQuestion 281 of 398
Under FINRA rules, a registered representative may generally share in the profits or losses of a customer's account only if:
a.The customer is a family member, with no other conditions
b.The representative promises to cover all losses
c.The account is discretionary and the customer is wealthy
d.The firm gives prior written approval and sharing is proportionate to the representative's own financial contribution
Explanation
Sharing in a customer account is permitted only with prior written approval from the firm and generally only in proportion to the representative's own capital contributed to the account. Guaranteeing against loss is never allowed.
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