ACFE Certified Fraud Examiner (CFE) - Law CFE-Law Question # 5 Topic 1 Discussion

ACFE Certified Fraud Examiner (CFE) - Law CFE-Law Question # 5 Topic 1 Discussion

CFE-Law Exam Topic 1 Question 5 Discussion:
Question #: 5
Topic #: 1

Which of the following is the MOST ACCURATE statement about rules prohibiting securities broker-dealers from making unsuitable recommendations on investments or investment strategies?


A.

A suitability violation occurs when a broker does not carry out a trade requested by or promised to a customer


B.

A suitability violation occurs when a broker recommends an investment or investment strategy that is inconsistent with the client's objectives


C.

A suitability violation occurs when a broker trades in a client's account without obtaining prior approval for making the transaction(s).


D.

A suitability violation occurs when a broker enters into transactions and manages a client's account for the purpose of generating excessive commissions


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