Series 24: 4.2.5.2. Prohibition On Spinning

Taken from our Series 24 Online Guide

4.2.5.2. Prohibition on Spinning

Rule 5131 prohibits the act of spinning. Spinning is when a member firm promises shares of an IPO to persons who are in a position to direct securities business to the firm in the future. Prior to the rule, investment banks would commonly offer shares of “hot IPOs” to officers and directors of companies in exchange for investment banking business.

The rule explicitly prohibits members from offering shares to officers and directors who have used the broker-dealer for investment banking services in the last 12 months, plan to use them in the next 3 months, or have stated or implied a commitment to use them in the future. FINRA extends this prohibition to persons materially supported by such executive officers and directors.

SAMPLE QUESTION

Which of the foll

+ Read More

More Series 24 Info

What are people saying?

Create an Account

Since you're reading about Series 24: 4.2.5.2. Prohibition On Spinning, you might also be interested in:

SIE - SEC Rule 145: Transactions That Do and Don’t Require Registration

SIE - Important Definitions in the Securities Industry

Series 53 - Customer Identification Verification: USA PATRIOT Act

Series 82 - 3.3.4.4. High-Yield or Junk Bonds

SIE - 4.1.2.2.2. Hedging with Covered Calls and Puts to Increase Income

Please Enable Javascript
to view this content!

Site Login

TESTIMONIALS

What are people saying?

As easy and painless as it could ever get (Series 24)!

Francis R., Hong Kong, China

I was very apprehensive about the Series 24 exam prior to taking it. Everyone I knew who had taken it informed me that it was an incredibly difficult test, with questions that were meant to trick you. After following Solomon's six week study outline and making flashcards for my weakest areas, I was averaging in the high 80s on the Solomon practice exams. That gave me the confidence I needed to walk into the test center feeling prepared, and the knowledge I needed to walk out of the test center having scored an 88. I am now recommending the Solomon Series 24 materials to everyone at the office!

Janie Richards, Austin, TX

I passed the S24 today with a score of 80. Your study guide is great!!!

A.T.

I had tried another learning system before Solomon and walked into the Series 24 unprepared and subsequently failed. After using the Solomon system for three weeks, taking full advantage of the app on my cell phone I walked into my second attempt very prepared for the type of questions I was going to see. Not only did I pass, I did so with confidence. Thanks so much Solomon!

Steven Eisner, Penn Mutual/HTK, Hauppauge, NY

I took my Series 24 on July 28 and passed!! I had not passed 2 prior Series 24 exams and was down to my last attempt. A fellow principal on my team who had not passed his Series 24 his first time told me about the Solomon practice tests and how they helped him. It was such a big help for me passing exam as the questions were structured more like the real exam than any other practice tests I’ve taken. I have since gone to other employees at my firm for other tests, such as the Series 7, SIE among others and have told them about the Solomon test materials and some of them are now purchasing Solomon as well.

Thadius Beavers, Prospera Financial. Dallas, TX.

Recently passed the Series 24 Exam. I owe it to the Solomon Exam Prep series. The format of study and testing preparation was easy to follow and comprehend. I had taken the exam before and used study material through a different provider. It did not give me the sense of readiness in the "connection of the dots" and time-management like the Solomon series did. Such a relief to see the word PASS.

Hope Brackin, Cambridge Investment Research, Inc., Auburn, AL