SIE Understanding Trading, Customer Accounts and Prohibited Activities Question 59: Answer and Explanation
Question: 59
Which of the following statements is true regarding proxies?
- A. FINRA Rule 2251 governs proxies for owners of stocks, corporate bonds, and municipal bonds.
- B. A FINRA member must provide proxy materials to the beneficial owner of stock whether or not the issuer provides enough copies of proxy materials.
- C. A FINRA member must provide proxy materials to the beneficial owner of stock whether or not the issuer requests this service.
- D. A shareholder may authorize another party to cast the votes which the shareholder is entitled to cast.
Correct Answer: D
Explanation:
D: Choice D is correct because proxy voting is a common practice for shareholder voting. Choice A is incorrect because the MSRB governs proxy activities for municipal bonds. Choices B and C are incorrect because FINRA must provide proxy materials to the beneficial owner only if enough copies are provided, and the service is requested.
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