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NASD Regulation Board of Governors Approves Publishing for Comment A Rule Interpretation on Transfer of Customer Accounts
The NASD has determined that it is not consistent with just and equitable principles of trade for a brokerage firm to take any action (including a court order) which interferes, delays or impedes a customer's right to transfer his account to another brokerage firm.
The NASD's interpretation provides exceptions for situations where an account contains non-transferable assets or proprietary funds. Additionally, the interpretation does not restrict employment contracts containing solicitation provisions. It also does not prevent firms from seeking court orders when brokers have violated these provisions.
The interpretation will be published for review and comment. Thereafter the NASD will file the interpretation with the SEC for approval.
Source: NASD News Release, May 7, 2001
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