Question

An agent engaged in churning as a result of fraudulent conduct is subject to a fine of ________ for each willful violation. (2012)

a) $1,000
b) $5,000
c) $10,000
d) $15,000

Answer 1

As of 2012, an agent who engages in the fraudulent activity of churning is subject to a fine of $5,000 for each willful violation.

Step-by-step explanation:

An agent engaged in churning as a result of fraudulent conduct is subject to a fine. Churning occurs when a broker engages in excessive buying and selling of securities in a client's account chiefly to generate commissions that benefit the broker, without regard for the client's investment objectives.

As of the year 2012, the fine for each willful violation of this fraudulent conduct was $5,000. It's important for students studying finance or law to understand the ethical considerations and legal penalties associated with professional financial conduct to ensure they adhere to proper standards in their future careers.