Under federal securities laws, a registered representative who passes material nonpublic information to a client can be held liable for insider trading violations even if the representative did not personally execute any trades based on that information.
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True
The statement is true because insider trading regulations hold tippers liable for passing material nonpublic information when the recipient trades on that information, regardless of whether the tipper executes trades or profits personally.
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Tipper and Tippee Liability under Insider Trading Regulations