Exercise
Answer true or false.
1. Full trading authority allows a third party to trade in an account and withdraw funds from the account.
2. After a married couple signs a joint party agreement upon opening a joint account, both parties are able to make transactions in the account without permission from the other.
3. The custodian of an UGMA account may withdraw funds from the account for any reason.
Choose the best answer.
4. John decides to donate $12,000 worth of stock to his 10-year-old nephew Ralph’s UGMA account. As Ralph gets older, however, Ralph begins to exhibit increasingly irresponsible behavior. John goes to his broker and asks him to remove the stock from Ralph’s custodial account. His broker tells him that:
A. This is no problem.
B. The gift of stock cannot be reversed.
C. Only stock in the amount of the original gift can be removed, and all growth must stay in the account.
D. The stock can be removed with a court order.
5. Joan is a registered representative who has Alfred as a customer. Joan does not have discretionary authority over Alfred’s account. Which of the following can Joan do?