Series 7 Exam Question 238: Answer and Explanation

Question: 238

To process an ACAT, a brokerage firm must be a member of the

  • A. FINRA
  • B. NSCC
  • C. SIPC
  • D. DRS

Correct Answer: B

Explanation:

B. To process an ACAT (Automated Customer Account Transfer), a brokerage firm must be a member of the NSCC (National Securities Clearing Corporation). When a brokerage firm is a clearing firm, the firm is assuming financial responsibility if a customer does not pay for a trade or does not deliver certificates that are sold.

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