Ethics · 25%
Recognize dishonest and unethical practices
Apply customer protection principles to recommendations, transactions, custody, records and conflicts.
Look for authority and consent
Unauthorized trading, discretionary activity without proper authority and misuse of customer funds are high-risk signals.
Evaluate the recommendation process
Know the customer, understand the security, disclose material conflicts and avoid recommendations driven by compensation.
Ethics25%
Communications20%
Agents13%
Broker-dealers12%
Remedies11%
Securities9%
Advisers5%
IARs5%
Detect manipulation and deception
Churning, front-running, fictitious activity, market manipulation and material misrepresentation undermine fair dealing.
Correct records promptly
Customer information and account records must remain accurate; concealment or informal workarounds compound the original problem.