If a firm imposes a temporary hold on a customer's account, how does it apply?

The correct answer is that a temporary hold on a customer's account can apply to the entire account or specific disbursements. This flexibility allows a firm to exercise discretion based on the specific circumstances surrounding the account or transactions in question.

When a firm places a temporary hold, it typically does so with the intention of safeguarding assets due to concerns such as potential fraud, pending inquiries, or regulatory compliance issues. This means they can restrict access to all funds and securities in the account or limit the restriction to certain transactions that may appear suspicious.

Understanding that a hold can be applied broadly to encompass the entire account or more narrowly to just specific types of disbursements helps clarify that firms have the authority to act in a way that best protects both their interests and those of their clients.