Which of the following is NOT a potential conflict of interest identified by regulators and academics?
A)Salesperson's stake.
B)Stuffing fiduciary accounts.
C)Bankruptcy risk transference.
D)Procompetitive effects.
E)Third-party loans.

Question

Quizplus · Accepted Answer

Procompetitive effects are not considered a potential conflict of interest. The other options are all examples of conflicts of interest that regulators and academics have identified. A salesperson's stake can create a conflict of interest if their commission is tied to the products they sell. Stuffing fiduciary accounts refers to the practice of encouraging clients to invest in certain products in order to generate fees for the firm, even if those products are not in the clients' best interest. Bankruptcy risk transference occurs when one party transfers the risk of bankruptcy to another party, such as a company hiding its financial problems from investors. Third-party loans may create conflicts of interest if they are not disclosed to clients or if they create incentives for the advisor to recommend certain products.

Which of the Following Is NOT a Potential Conflict of Interest