Question

Under the FINRA Conduct Rules, a broker-dealer may charge a customer all of the following services except:_______.a. collection of dividends on margin securities.
b. safekeeping of securities.
c. appraisals of securities in a customer portfolio.
d. distributing proxies to holders of securities in margin account.

Answer 1

Answer:

distributing proxies to holders of securities in margin account

Explanation:

Proxies are voting materials on shares that are given by the issuer of the shares to the brokerage that is holding the shares.

Proxies are paid for by the issuer and not the customer.

A broker is allowed to charge for various services rendered. For trading and market related services the 5% rule holds, while for other clerical services such as collection of dividends, safe keeping appraisal of securities, and transfer of securites.

Charges must be fair and reasonable.