Series 65: 10.11.2. Loans To And From Clients

10.11.2. Loans to and From Clients

While it might come as a surprise, one of the more common ethical violations occurs when an investment adviser, IAR, or agent loans money to or borrows money from a client. When you stop to think about it, it’s not hard to imagine why this temptation is so common. Financial professionals often have intimate knowledge about the finances of their clients, including when their clients have extra money lying around or are short of needed cash. In these situations, professionals without clear boundaries might see an o