Which of the Following Is NOT a Requirement When a Bank

question 8

Multiple Choice

Which of the following is NOT a requirement when a bank pays an employee a fee for referring a high-net-worth or institutional customer to a broker?

• A) The bank must have a written agreement with the broker
• B) The bank must give a disclosure to the customer
• C) The bank must reasonably believe that the customer is a high net worth or institutional customer
• D) The employee must be registered with the bank's regulatory agency

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Definitions:

Discounted Note

A promissory note sold at a discount from its face value, where the difference between the purchase price and the value at maturity represents the interest income for the investor.

Maturity Value

The amount payable to the holder of a financial instrument at its maturity date, including the principal and any accrued interest.

Interest

The cost paid for borrowing money, typically expressed as a percentage of the total amount loaned.

Periodic Inventory

An inventory accounting system where inventory and cost of goods sold are determined at the end of an accounting period based on a physical count.