Exercise
Match each term to the appropriate securities violation
A. Insider trading
B. Selling away
C. Improper outside business activity
D. Market manipulation
E. No violation occurred
1. _____ Two agents who work at the same firm enter an agreement in which one agent buys 100 shares of a security at $100, while another agent sells 100 shares of the same security at $100.
2. _____ A client is made aware of material non-public information about a specific security and, as a result, buys shares of that security the following day.
3. _____ An agent sells securities to a client. The securities are not sold by the agent’s firm, and the firm is unaware that the sale takes place.
4. _____ An agent makes trades in an account with another firm without notifying her employing firm.
5. _____ A friend of an investment adviser representative tells the IAR that the production of a traded company's much-publicized product may not occur as originally planned.
Answers
1. D. Intentionally