A sales representative solicits and executes
a mutual fund trade, but fails to record the trade
with the broker-dealer. Under the Uniform Securities
Act, this action would be:
a) Allowed, but only if no commission was taken on
b) Allowed, since mutual fund trades are not required
to be kept on the broker-dealer’s books
d) Allowed, since mutual fund trades are recorded
on the mutual fund company’s books
Answer: The correct answer is c).
This would be considered a private securities transaction,
which is not permitted. All securities trades must
be entered into the broker-dealer’s books.