Series 27: Exercise

Exercise

Answer true or false

1. 1. True or false. Broker-dealers may not offer their own securities as additional collateral for a loan they carry for the account of a customer in the case of a margin deficiency.
2. 2. True or false. Rehypothecation is the practice of using a customer’s collateralized securities to finance another loan.
3. 3. True or false. A broker-dealer may not commingle hypothecated securities of any customer with its own securities unless it has the customers’ prior written consent.
4. 4. True or false. Broker-dealers may commingle hypothecated customer securities with the securities of other broker-dealers.
5. 5. True or false. Broker-dealers must give their creditors prior written notice when their loans are to be collateralized by hypothecated customer securities.

Answers

1. 1. False. Broker-dealers may use their own securities as additional collat