Which of the following statements describes a violation of industry standards of conduct?

The correct answer is C, An RR takes a second job as a bartender without notifying her firm. This is a violation of FINRA rules regarding outside business activities (OBAs). Registered representatives are required to provide prior written notice to their firm before engaging in any outside employment, regardless of whether it is related to the securities industry. The firm must then evaluate whether the activity presents a conflict of interest.

Step-by-step, FINRA Rule 3270 governs OBAs and ensures firms can supervise potential conflicts or reputational risks. Failure to notify the firm prevents proper supervision and is therefore a clear violation.

Choice A is not a violation because a felony conviction older than 10 years does not automatically disqualify an individual from registration under statutory disqualification rules. Choice B is not a violation because a cousin is not considered an immediate family member under IPO restricted persons rules, so the purchase is permitted. Choice D is also not a violation, provided the research report is publicly available and the RR follows firm policies regarding personal trading.

Thus, failing to disclose outside employment is a direct breach of industry conduct standards, making Answer C correct.