Lancaster, CA asked in Stockbroker Fraud for California

Q: I have a stock account and I was wondering if my 16 year old son could legally make stock trades on my account?

I have an webull account and I was wondering if my 16 year old son could make stock trades on my account if I give him permission, I live in California and I was wondering if this was legal? This is my own money, I’m on a cash account.

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1 Lawyer Answer
James L. Arrasmith
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  • Criminal Law Lawyer
  • Sacramento, CA
  • Licensed in California

A: In the United States, there are legal restrictions on minors (those under 18 years old) engaging in financial transactions, including stock trading. Here are some key points regarding your situation:

1. Brokerage accounts are typically opened and maintained under the name of an adult individual or entity. Minors cannot open accounts in their own name.

2. While you could potentially give your son access to your account and permission to trade, this would still be considered your account and your trades legally. The account would remain under your name and control.

3. California law generally does not prohibit parents from allowing their minor children to make trades in the parent's account if the parent consents and maintains control over the account.

4. However, brokerage firms may have their own policies restricting minors from trading or requiring parental consent forms to be completed. Webull's specific policies would need to be checked.

5. As the account holder, you would be legally responsible for all trades made in the account, even if executed by your son with your permission.

So in summary, while California law may allow it if you maintain control, you'd need to verify Webull's specific policies. And you would still be legally liable for any trades your son makes in your account. Many parents choose to open a custodial account instead to better track the minor's holdings separately.

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