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Does a good faith violation have any consequence beyond 12 months after it happened?

Personal Finance & Money Asked on August 16, 2021

I read on https://www.fidelity.com/learning-center/trading-investing/trading/avoiding-cash-trading-violations:

If you incur 3 good faith violations in a 12-month period in a cash account, your brokerage firm will restrict your account.

Does a good faith violation have any consequence beyond 12 months after it happened?

One Answer

The consequence of 3 good faith violations in 12 months is a 90 day account restriction.

Once you serve your time (account restricted for 90 days), I don't know if the 3 violations are wiped clean or whether the rolling count continues. I would guess the latter in that when you incur a 4th violation, there's a 12 month look back and if it sees two previous violations, you're in back in trading hell again. Google for details.

Answered by Bob Baerker on August 16, 2021

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