Rule 405

Rule 405

NYSE codification of "know your customer" rules, which require that a customer's situation is suitable for any investment being made.

Rule 405

A New York Stock Exchange rule requiring investment advisers to only make or recommend investments for their clients' accounts that a "prudent person" would make. This means that investment advisers are not allowed to make investments they believe will lose money for the client. It does not require that the investment adviser always make correct decisions; it merely requires him/her to make decisions that will be generally accepted as sound for someone of average intelligence who seeks to do what is in the client's best interests as the client defines them. It is an example of a suitability rule. See also: Prudent-Person Rule.

Rule 405

The "know your customer" rule of the New York Stock Exchange that requires member firms to obtain significant facts from customers when opening new accounts. These facts are supposed to give the broker and the firm some background on the customers.
References in periodicals archive ?
Another evidence rule, Rule 405, provides further guidance to a party seeking to prove a character trait.
19) Thus, for example, Rule 405 prohibits the admission of specific prior bad acts even for the sole purpose of proving character in a murder case to establish that the victim was the first aggressor, as a person's "character for violence" is not an element of the crime of murder or of self-defense.
Rule 405 provides the acceptable methods of proving character when an exception to the general prohibition applies.
Thus, while profile and syndrome evidence may be authorized by the exceptions of Rule 404, such as when a criminal defendant offers evidence of his own character trait, there is no proper method to introduce it under Rule 405.
The final rule allows use of S-3 when (1) the issuer has outstanding (as of a date within 60 days prior to the filing of the registration statement) at least $750 million of nonconvertible securities, other than common equity, issued in primary offerings for cash, not exchange, or (2) is a wholly-owned subsidiary of a WKSI as defined in Rule 405 under the Securities Act.
As a result of the committee's changes pursuant to numbered paragraph (4), Rule 405, Methods of Proving Character, now includes opinion testimony along with reputation testimony as a method of proof in cases where character evidence is admissible.
The issuer is eligible to use Form S-8, the options subject to the exchange offer were issued under an employee benefit plan as defined in Rule 405 of the 1933 Act, and the securities offered in the exchange offer will be issued under such an employee benefit plan;
The court also noted three instances in which the rules have been changed: Rule 405 and Rule 608, both of which have to do with evidence of character, and Rule 803(3), which will allow opinion statements as to the existing state of mind or physical condition of a person even if that person would be available as a witness.
Due to adverse equity market conditions and the decline in the trading price of the Company's Common Stock, the Company does not at this time qualify as a "well-known seasoned issuer" (as defined in Rule 405 of the Securities Act of 1933, as amended), and the post-effective amendment is being filed solely to convert the existing automatic shelf registration statement into a non-automatic shelf registration statement.
This press release may constitute a "free writing prospectus" and an "issuer free writing prospectus" as such terms are defined in Rule 405 and Rule 433, respectively, under the Securities Act of 1933, as amended, and relates to the registration statement on Form S-3 filed by Tower Group, Inc.
Additionally, the business and financial materials and any other statement or disclosure on, or made available through, the Company's websites shall not be considered a "free writing prospectus" under the SEC's Rule 405 of the Securities Act of 1933, as amended, unless specifically identified as such.
CER) is a "foreign private issuer" as defined in Rule 3b-4 under the Securities Exchange Act of 1934, as amended, and in Rule 405 under the Securities Act of 1933, as amended.