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Question 6: Carrie is a registered agent employed by CanDo Broker-Dealers. Her uncle is a minister who
regularly
refers his parishioners to Carrie, in return for which Carrie has agreed to donate a quarter of her
commissions from these transactions to the parish. Is Carrie doing anything illegal?
A. No. Carrie is just donating some of her commissions back to the church, and transactions with
B. Yes. Carrie is splitting her commissions with an entity that is not affiliated with her broker-dealer
C. It depends. As long as the church parishioners are aware of the arrangement between Carrie and
D. It depends. If the church itself is a client of CanDo's, then it is considered to be affiliated with
Correct Answer: B
Explanation: Yes. Carrie is violating NASAA's Model Rules in splitting her commissions with an entity
that
is not a registered agent affiliated with her firm. It doesn't matter that the entity is a church, even if
that
church is itself a client of the broker-dealer.
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