CFA Practice Question

There are 361 practice questions for this study session.

CFA Practice Question

An investment banking department of a brokerage firm often receives material nonpublic information that could have considerable value if used in advising the firm's brokerage clients. In order to conform to the Code and Standards, which of the following is the best policy for the brokerage firm?
A. monitor the exchange of information between the investment banking department and the brokerage operation
B. establish physical and informational barriers within the firm to prevent the exchange of information between the investment banking and brokerage operations
C. prohibit purchase recommendations when the investment banking department has access to material nonpublic information but, in view of the fiduciary obligations to clients, allow sale of current holdings

User Contributed Comments 4

User Comment
showmethemoney chinese wall
soukhov deadly traps
kingirm Physical? Really?
JNW1980 I think the CFAI and many others are in denial here. "Chinese Walls" are nothing compared to the power of incentives... I bet I know what Charlie Munger would say about this.....
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