Series 7 Exam Question 155: Answer and Explanation

Question: 155

A violation in which a registered rep excessively trades a customer's account for the sole purpose of generating commissions is known as

• A. excessive trading
• B. frontrunning
• C. trading ahead
• D. churning

Correct Answer: D

Explanation:

D. Churning is a violation where a registered rep promotes excessive trading in a customer's account for the sole purpose of generating commissions.