10 Va. Admin. Code § 5-22-130 - Referral of securities transactions

Current through Register Vol.. 38, No. 17, April 11, 2022

An affiliated trust company may not direct to an affiliated broker-dealer the compensation-producing securities transactions of a trust account, unless:

1. Such action is authorized by the account settlor, the beneficiaries, or a court (depending on the circumstances) by specific written consent or authorization obtained after disclosure of the relationship and the terms of the arrangement;
2. Use of the affiliated broker-dealer is in the best interest of the account;
3. In the case of employee benefit trusts, a reasoned opinion of counsel is obtained to the effect that the proposed use does not violate the Employee Retirement Income Security Act of 1974 ( 29 USC § 1001 et seq.); and
4. The trust company has established adequate safeguards against potential abuses (e.g., "churning").

Notes

10 Va. Admin. Code § 5-22-130
Derived from VR225-01-0205 § 13, eff. April 20, 1995.

Statutory Authority

§ 6.2-1034 of the Code of Virginia.

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