Unauthorized Trading

By October 21, 2015 October 15th, 2017 Glossary

When a broker purchases or sells an investment without the client’s knowledge and permission, this constitutes unauthorized trading. Brokers generate commission by executing trades, and often a broker will buy or sell an investment without the investor’s knowledge in order to generate additional commission or to place the investor into a product that the client would not approve because it is riskier than the investor’s wishes.