Examkin

Soru

Zorluk: ZorCustomer Account Types and Ownership Structures

Match each customer account structure or authorization type with its defining operational rule or regulatory requirement.

  • Joint Tenants in Common (TIC) AccountUpon a tenant's death, their specific percentage interest passes to their estate rather than surviving account holders.
  • Uniform Transfers to Minors Act (UTMA) Custodial AccountAssets are considered an irrevocable gift owned by a single minor, and margin trading is strictly prohibited.
  • Individual Account with Limited Power of Attorney (LPOA)A designated third party is authorized to enter buy and sell orders but cannot withdraw funds or assets.
  • Corporate AccountMust submit a formal resolution chartering specific officers who are authorized to conduct trading activities.

Cevap

Joint Tenants in Common (TIC) pairs with estate transfer upon death; UTMA Custodial Account pairs with irrevocable ownership by one minor and prohibition of margin; Limited Power of Attorney (LPOA) pairs with third-party trading authority excluding asset withdrawal; and Corporate Account pairs with the corporate resolution requirement.
Each account ownership structure has specific legal, operational, and regulatory features: TIC preserves estate inheritance rights for deceased owners; UTMA enforces irrevocable ownership for a single minor in cash-only accounts; LPOA limits third-party privileges to trading without withdrawal rights; and Corporate accounts mandate a board-approved corporate resolution to verify trading authority.

Adım Adım Çözüm

1
Evaluate survivorship and transfer provisions of joint account structures.
Tenants in Common (TIC) permits fractional ownership where a deceased tenant's interest flows to their estate rather than surviving tenants.
Differentiates TIC provisions from Joint Tenants with Rights of Survivorship (JTWROS).
2
Analyze custodial account rules under UTMA/UGMA.
UTMA assets belong irrevocably to a single minor beneficiary and must be held in a cash account, preventing margin transactions.
Protects minor assets under fiduciary custody principles.
3
Distinguish Limited Power of Attorney (LPOA) from Full Power of Attorney (FPOA).
LPOA grants discretionary order entry privileges but restricts third-party fund/securities disbursements.
Defines the boundary of legal authorization for non-owner order entry.
4
Identify required documentation for opening institutional/corporate accounts.
A broker-dealer must obtain a corporate resolution adopted by the board specifying authorized traders.
Establishes legal authority of individuals acting on behalf of a corporation.

Anahtar Kavram

Operational and Legal Distinctions of Customer Account Types and Power of Attorney
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Konular

Customer Account Types and Ownership Structures