The NASD sets out the following prohibited conduct:

• Unsuitable Investments
  Recommending to a customer the purchase or sale of a security that is unsuitable given the customer's age, financial situation, investment objective, and investment experience.
  
  
• Investment in a particular type of security may be unsuitable or the amount or frequency of transactions may be excessive and therefore unsuitable for a given customer.
  
  
• Unauthorized Purchasing
  Purchasing or selling securities in a customer's account without first contacting the customer and the customer did not specifically authorize the sale or purchase, unless the broker has received from the customer written discretionary authority to effect transactions in the account or the broker was given discretion as to price and time.
  
  
• Unnecessary Switching
  Switching a customer from one mutual fund to another when there is no legitimate investment purpose underlying the switch.
  
  
• Misrepresentation
  Misrepresenting or failing to disclose material facts concerning an investment. Examples of information that may be considered material and that should be accurately presented to customers include: the risks of investing in a particular security; the charges or fees involved; company financial information; and technical or analytical information, such as bond ratings.
  
  
• Unauthorized Removal of Funds or Securities
  Removing funds or securities from a customer's account without the customer's prior authorization.
  
  
• Excessive Commissions
  Charging a customer excessive markups, markdowns, or commissions on the purchase or sale of securities.
  
  
• Price Predictions and Recommendations of Guaranteed Profit
  Guaranteeing customers that they will not lose money on a particular securities transaction, making specific price predictions, or agreeing to share in any losses in the customer's account.
  
  
• Private Broker and Customer Transactions
  Private securities transactions between a broker and a customer which may violate NASD rules, particularly where such transactions are done without the knowledge and permission of the sales representative's firm.
  
  
• Front Trading
  Trading for a firm's account in preference to a customer by trading ahead of a customer limit order, absent a valid exception.
  
  
• Failure to Display Customer Limit Order
  Failure by a market maker to display a customer limit order in its published quotes, absent a valid exemption.
  
  
• Failure to Execute Order at Best Price
  Failing to use reasonable diligence to see that a customer's order is executed at the best possible price, given prevailing market conditions.
  
  
• Insider Trading
  Purchasing or selling a security while in possession of material, non-public information regarding an issuer.
  
  
• Fraudulent or Deceptive Practices
  Using any manipulative, deceptive, or other fraudulent device or contrivance to effect any transaction in, or induce the purchase or sale of, any security.

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