12 CFR § 368.4 - Recommendations to customers.

---
identifier: "/us/cfr/t12/s368.4"
source: "ecfr"
legal_status: "authoritative_unofficial"
title: "12 CFR § 368.4 - Recommendations to customers."
title_number: 12
title_name: "Banks and Banking"
section_number: "368.4"
section_name: "Recommendations to customers."
chapter_name: "FEDERAL DEPOSIT INSURANCE CORPORATION"
subchapter_number: "B"
subchapter_name: "REGULATIONS AND STATEMENTS OF GENERAL POLICY"
part_number: "368"
part_name: "GOVERNMENT SECURITIES SALES PRACTICES"
positive_law: false
currency: "2026-04-05"
last_updated: "2026-04-05"
format_version: "1.1.0"
generator: "[email protected]"
authority: "15 U.S.C. 78o-5."
regulatory_source: "62 FR 13287, Mar. 19, 1997, unless otherwise noted."
cfr_part: "368"
---


# 368.4 Recommendations to customers.

In recommending to a customer the purchase, sale or exchange of a government security, a bank that is a government securities broker or dealer shall have reasonable grounds for believing that the recommendation is suitable for the customer upon the basis of the facts, if any, disclosed by the customer as to the customer's other security holdings and as to the customer's financial situation and needs.