New Mexico Administrative Code › Title 12 - TRADE, COMMERCE AND BANKING › Chapter 11 - SECURITIES › Part 4 - BROKER-DEALER AND AGENTS RULES OF CONDUCT AND PROHIBITED BUSINESS PRACTICES › Section 12.11.4.15 - PROHIBITED BUSINESS PRACTICES BY BROKER-DEALERS

Current through Register Vol. 35, No. 13, July 16, 2024
The following are deemed to be unethical and dishonest
				  conduct or practices by a broker-dealer under Section
				  58-13C-412
				  C(13) NMSA 1978 without limiting those terms to the practices specified
				  herein:
A. causing any unreasonable
				delay in the delivery of securities purchased by any of its customers, or in
				the payment upon request of free credit balances reflecting completed
				transactions of any of its customers;
B. inducing trading in a customer's account
				which is excessive in size or frequency in view of the financial resources and
				character of the account;
C.
				recommending to a customer the purchase, sale or exchange of any securities
				without reasonable grounds to believe that the recommendation is suitable for
				the customer on the basis of information furnished by the customer after
				reasonable inquiry concerning the customer's investment objectives, financial
				situation and needs, and any other information known by the
				broker-dealer;
D. executing a
				transaction on behalf of a customer without authority to do so;
E. executing a transaction for the account of
				a customer upon instruction from a third party without first obtaining written
				discretionary authority from the customer, unless the discretionary power
				relates solely to the time or price for the execution of orders, or
				both;
F. exercising any
				discretionary power in effecting a transaction for a customer's account without
				first obtaining written discretionary authority from the customer, unless the
				discretionary power relates solely to the time or price for the execution of
				orders, or both;
G. extending,
				arranging for, or participating in arranging for credit to a customer in
				violation of the Securities Exchange Act of 1934 or the regulations of the
				Federal Reserve Board;
H. executing
				any transaction in a margin account without obtaining from its customer a
				written margin agreement not later than 15 calendar days after the initial
				transaction in the account;
I.
				failing to segregate customers' free securities or securities in
				safekeeping;
J. hypothecating a
				customer's securities without having a lien thereon unless written consent of
				the customer is first obtained, except as permitted by rules of the
				SEC;
K. charging its customer an
				unreasonable commission or service charge in any transaction executed as agent
				for the customer;
L. entering into
				a transaction for its own account with a customer with an unreasonable markup
				or markdown;
M. entering into a
				transaction for its own account with a customer in which a commission is
				charged;
N. entering into a
				transaction with or for a customer at a price not reasonably related to the
				current market price;
O. executing
				orders for the purchase by a customer of securities not registered or exempted
				unless the transaction is exempted under the New Mexico Uniform Securities
				Act;
P. representing itself as a
				financial or investment planner, consultant, or adviser, when the
				representation does not accurately describe the nature of the services offered,
				the qualifications of the person offering the services and the method of
				compensation for the services;
Q.
				violating any material rule of any securities exchange or national securities
				association of which it is a member with respect to any customer, transaction
				or business in this state;
R.
				failing to furnish to a customer purchasing securities in an offering, not
				later than the date of confirmation of the transaction, either a final
				prospectus or a preliminary prospectus and an additional document, which
				together include all information set forth in the final prospectus;
S. introducing customer transactions on a
				"fully disclosed" basis to another broker-dealer that is not registered under
				the New Mexico Uniform Securities Act;
T. recommending to a customer that the
				customer engage the services of an investment adviser that is not registered
				under the New Mexico Uniform Securities Act or the Investment Advisers Act of
				1940; and
U. using in a misleading
				manner any term or abbreviation that states or implies that a person has
				special expertise, certification, or training in financial planning, including
				but not limited to, the misleading use of a senior-specific certification or
				designation as set forth in 12.11.17 NMAC.