Unauthorized Trading


Unauthorized trading involves the purchase or sale of a security by a broker without the prior consent of the customer, in a non-discretionary account. Unauthorized trading allegations are common in securities arbitrations.

FINRA Rule 2010 (Standards of Commercial Honor and Principles of Trade) prohibits brokers from making unauthorized transactions in their customers’ accounts.

There are certain exceptions.  For instance, if a customer has a margin account and the value of the account falls below the brokerage firm's requirements, the broker may be able to sell the customer’s securities without consulting the customer beforehand.  For more information, please read “Margin Position Sellouts”

Contact Ms. Stoneman if you think you've been a victim of unauthorized trading.

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