A 'Chinese wall' is supposed to prevent the transfer of insider information about clients between the investment banker's security underwriting division and the internal unit where proprietary trading of stocks and bonds takes place.

Question

Quizplus · Accepted Answer

This is correct. A Chinese wall is a term used to describe the separation between investment banking and proprietary trading activities in order to prevent the misuse of insider information.

A 'Chinese Wall' Is Supposed to Prevent the Transfer of Insider