SERIES-6 practice question 29 of 35
Ms. Scatty is a registered representative with a well-known family of mutual funds. When selling one of the funds, she forgets to give her buyer a prospectus. Which of the following statements is true?
Full set: 325 questionsCorrect Answer:
A. Ms. Scatty can be held civilly liable under the Securities Act of 1933.
Explanation
If Ms. Scatty forgets to give her buyer a prospectus when selling one of the funds, she can be held civilly liable under the Securities Act of 1933. Unless there was an intent to defraud, she is not subject to criminal penalties. The purchase and sale of mutual fund shares fall under the Securities Act of 1933.
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