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If a customer fails to pay for securities purchased in a cash account, the member firm broker will do which of the following?
Suggested Answer: D
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liquidate the securities or otherwise cancel the transaction. Reg T requires the position closed if the customer fails to comply with the rules. An extension may be granted, but not by the member firm. Only an exchange or the FINRA grants extensions for bona fide reasons.
11 comments · newest first
LI
Lili
1 year ago
B is misleading, they don’t just place it in a general account.
TY
Tyisha
1 year ago
Wait, can they really just cancel the whole transaction?
NA
Nancey
1 year ago
Definitely D, no doubt about it!
KE
Kenneth
1 year ago
I thought they could grant extensions sometimes?
NY
Nydia
1 year ago
D is the correct answer, they usually liquidate.
SH
Sharika
1 year ago
I recall that the firm usually has to protect itself, so I’m leaning towards option D, but I hope I’m not mixing it up with another scenario.
EL
Elvis
1 year ago
I’m a bit confused about the options. I thought they could grant an extension, but that seems risky for the firm.
AL
Alysa
1 year ago
I feel like I've seen a question like this before, and I think the answer was about liquidating the securities.
YV
Yvonne
1 year ago
I think I remember that if a customer doesn't pay, the broker has to take action, but I'm not sure if it's to liquidate or cancel the transaction.
AN
An
1 year ago
This looks like a straightforward question about logging in an AWS Lambda function. I think the key is to identify where the request ID is available and how to configure the logging output.
LA
Launa
1 year ago
I'm leaning towards option A, but I'm second-guessing whether an increase in YTM necessarily leads to a lower bond price...