SIDC Module 6 Market conduct, client treatment and AML/CFT question: SC's Appendix illustrations call

SIDC Module 6Market conduct, client treatment and AML/CFT

Near the close, a dealer's representative places clients' buy orders that lift a share above its prior sale price, while entering and withdrawing orders never meant to execute. The SC's Appendix illustrations call this:

A Painting the tape
B Front running
C Marking the close
D Scalping

Show the answer and explanation

Answer: C. Marking the close

Illustration 7 in Part III of the Guidelines on Market Conduct and Business Practices describes a dealer's representative who places orders at the close of the trading day that move the price above the prior sale price, while entering and withdrawing orders before execution to give a misleading impression of demand or supply. The SC labels this marking the close, and paragraph 12.02(b) lists buying at or near the close at successively higher prices as conduct a firm must not assist. Front running is trading ahead of a large client's order. Painting the tape is issuing false trade reports to suggest activity. Scalping is trading around one's own recommendation. Source: Guidelines on Market Conduct and Business Practices for Stockbroking Companies and Licensed Representatives (SC-GL/SBC-2008 (R6-2023), revised 7 September 2023) para 12.02(b); Part III Illustration 7 (as at October 2026).

Common mistake

Confusing marking the close with painting the tape; the tape is painted by false trade reports, not closing orders.

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Original study material mapped to the public SIDC Module 6 syllabus. Unofficial, not endorsed by SIDC or the SC. Verify figures and rules against current guidance before relying on them.