Question 1

Which of the following is NOT a corporate practice required of bank holding companies?

Accepted Answer

A)  Each bank subsidiary must file a notice with the Federal Reserve before offering a new product. 
B)  Each bank subsidiary must conduct its operations in a safe and sound manner. 
C)  Each bank subsidiary must be insured by the FDIC. 
D)  Each bank subsidiary must file a notice with the Federal Reserve before purchasing any of its own securities. 
A)  Each bank subsidiary must file a notice with the Federal Reserve before offering a new product. 
B)  Each bank subsidiary must conduct its operations in a safe and sound manner. 
C)  Each bank subsidiary must be insured by the FDIC. 
D)  Each bank subsidiary must file a notice with the Federal Reserve before purchasing any of its own securities.

Question 2

Which of the following is true of a bank's CRA strategic plan?

Accepted Answer

A)  It must be limited to a one-year term. 
B)  It must have measurable goals. 
C)  Affiliates must have their own plans. 
D)  Even if the bank has multiple assessment areas, it must have one strategic plan. 
A)  It must be limited to a one-year term. 
B)  It must have measurable goals. 
C)  Affiliates must have their own plans. 
D)  Even if the bank has multiple assessment areas, it must have one strategic plan.

Question 3

Which of the following actions is acceptable under the financial reporting regulations?

Accepted Answer

A)  Attaching a narrative explanation by management of the reasons for a cease and desist order as a part of the annual disclosure 
B)  Attaching a copy of the bank's last safety and soundness examination to the annual disclosure 
C)  Including a statement that indicates that the bank's regulatory agency has reviewed the financial information 
D)  Using an unaudited financial statement for the past two years as an annual disclosure statement 
A)  Attaching a narrative explanation by management of the reasons for a cease and desist order as a part of the annual disclosure 
B)  Attaching a copy of the bank's last safety and soundness examination to the annual disclosure 
C)  Including a statement that indicates that the bank's regulatory agency has reviewed the financial information 
D)  Using an unaudited financial statement for the past two years as an annual disclosure statement

Question 4

Requirements-12 CFR 202.2, 202.4, 202.5, 202.6, and 202.13 say that a creditor may not request information about an application's race, color, religion, national origin, or gender except as specifically permitted by ____________or another statute such as the Home Mortgage Disclosure Act.

Accepted Answer

A)  Regulation B 
B)  Regulation U 
C)  Regulation Z 
D)  Regulation A 
A)  Regulation B 
B)  Regulation U 
C)  Regulation Z 
D)  Regulation A

Question 5

A compliance professional is a member of the task force studying how the bank can reduce customer complaints about holding deposits. One proposed solution involves purchasing an expensive system that will reduce the number of holds placed by evaluating the customer's history and relationship with the bank. Which of the following roles is MOST important for the compliance professional on the task force?

Accepted Answer

A)  Developing training for tellers who will use the new system 
B)  Setting parameters for what the system should review to determine the strength of the customer relationship 
C)  Validating the system to ensure it complies with regulatory restrictions 
D)  Conducting a cost-benefit analysis to determine if the system is the best solution 
A)  Developing training for tellers who will use the new system 
B)  Setting parameters for what the system should review to determine the strength of the customer relationship 
C)  Validating the system to ensure it complies with regulatory restrictions 
D)  Conducting a cost-benefit analysis to determine if the system is the best solution

Question 6

Supervisory review should also be the part of Subprime Mortgage Lending. It should review:

Accepted Answer

A)  Regulatory agencies will continue to focus on risk management review and consumer compliance processes 
B)  Hiring and Training of personnel 
C)  Agencies will continue to take action against institutions that violate consumer protection laws or fair lending laws or that engages in unfair or deceptive acts or practices or in unsafe or unsound lending practices 
D)  Applicability of prepayment penalties 
A)  Regulatory agencies will continue to focus on risk management review and consumer compliance processes 
B)  Hiring and Training of personnel 
C)  Agencies will continue to take action against institutions that violate consumer protection laws or fair lending laws or that engages in unfair or deceptive acts or practices or in unsafe or unsound lending practices 
D)  Applicability of prepayment penalties

Question 7

Which of the following actions is NOT required of a municipal securities principal?

Accepted Answer

A)  Pass the Municipal Securities Principal Qualification Examination 
B)  Complete Form MSD-4 and submit it to the bank 
C)  Work as an apprentice for one year in a municipal securities operation 
D)  Work in a supervisory role in a municipal securities operation 
A)  Pass the Municipal Securities Principal Qualification Examination 
B)  Complete Form MSD-4 and submit it to the bank 
C)  Work as an apprentice for one year in a municipal securities operation 
D)  Work in a supervisory role in a municipal securities operation

Question 8

Which of the following statements is true regarding the lessee's ability to purchase the leased property?

Accepted Answer

A)  The lessor must allow the lessee to purchase the leased property either during the lease term or at the end of the term. 
B)  If the lessor allows the lessee to purchase the property at the end of the lease term, the lessor may not charge more than the equivalent of 12 monthly payments for the property. 
C)  If the lessor allows the lessee to purchase the property at the end of the lease term, the purchase price must be disclosed in the initial disclosure statement. 
D)  The purchase price of the leased property must be mutually agreed on by the lessor and the lessee. 
A)  The lessor must allow the lessee to purchase the leased property either during the lease term or at the end of the term. 
B)  If the lessor allows the lessee to purchase the property at the end of the lease term, the lessor may not charge more than the equivalent of 12 monthly payments for the property. 
C)  If the lessor allows the lessee to purchase the property at the end of the lease term, the purchase price must be disclosed in the initial disclosure statement. 
D)  The purchase price of the leased property must be mutually agreed on by the lessor and the lessee.

Question 9

By which date must an interest reporting statement be sent to the borrower's last known address?

Accepted Answer

A)  January 15 of the year following the year the interest is paid 
B)  January 31 of the year following the year the interest is paid 
C)  February 28 of the year following the year the interest is paid 
D)  March 1 of the year following the year the interest is paid 
A)  January 15 of the year following the year the interest is paid 
B)  January 31 of the year following the year the interest is paid 
C)  February 28 of the year following the year the interest is paid 
D)  March 1 of the year following the year the interest is paid

Question 10

On which of the following loans must a bank maintain records under the Bank Secrecy Act?

Accepted Answer

A)  All loans exceeding $5,000 and secured by real property 
B)  All loans exceeding $5,000, but not secured by real property 
C)  All loans exceeding $10,000 and secured by real property 
D)  All loans exceeding $10,000, but not secured by real property 
A)  All loans exceeding $5,000 and secured by real property 
B)  All loans exceeding $5,000, but not secured by real property 
C)  All loans exceeding $10,000 and secured by real property 
D)  All loans exceeding $10,000, but not secured by real property

Question 11

Which of the following is MOST effective in strengthening an anti-money- laundering program involving cash transactions?

Accepted Answer

A)  Review all deposits of $25,000 or more 
B)  Complete CTR worksheets on all cash transactions of $5,000 or more 
C)  Complete SAR worksheets on all cash transactions of $5,000 or more 
D)  Monitor cash transactions of less than $10,000 for suspicious patterns 
A)  Review all deposits of $25,000 or more 
B)  Complete CTR worksheets on all cash transactions of $5,000 or more 
C)  Complete SAR worksheets on all cash transactions of $5,000 or more 
D)  Monitor cash transactions of less than $10,000 for suspicious patterns

Question 12

If the lender is subject to the mortgage interest reporting requirement, which of the following actions is NOT required?

Accepted Answer

A)  The lender must file an information return with the IRS. 
B)  The lender must report the amount of interest and points on the information return. 
C)  The lender must report the loan balance as of December 31 of the year preceding the year the report is filed. 
D)  The lender must send a statement to the borrower. 
A)  The lender must file an information return with the IRS. 
B)  The lender must report the amount of interest and points on the information return. 
C)  The lender must report the loan balance as of December 31 of the year preceding the year the report is filed. 
D)  The lender must send a statement to the borrower.

Question 13

A bank has a stand-alone ATM in a high crime area. Due to concerns for the safety of individuals using the ATM, management decides to close it. According to branch closing policy statements issued by federal regulators, which of the following actions should the bank take?

Accepted Answer

A)  No action is required because an ATM is not, by definition, a branch. 
B)  Post a notice at the ATM at least 30 days before the intended closing date. 
C)  Notify the bank's federal regulatory agency at least 90 days before the intended closing date. 
D)  Mail a notice to all customers at least 90 days before the intended closing date. 
A)  No action is required because an ATM is not, by definition, a branch. 
B)  Post a notice at the ATM at least 30 days before the intended closing date. 
C)  Notify the bank's federal regulatory agency at least 90 days before the intended closing date. 
D)  Mail a notice to all customers at least 90 days before the intended closing date.

Question 14

The purpose of guidelines for National Banks to Guard against Predatory and Abusive Lending Practices- AL-2003-2 includes all of the following EXCEPT:

Accepted Answer

A)  Provide examples to national banks of practices that may be abusive 
B)  Advise banks on how they should avoid abusive practices 
C)  Banks should consider appropriate discount rates, credit loss rates, and prepayment rates when valuing these assets 
D)  Show how some abusive lending can involve unfair or deceptive practices and therefore violate the Federal Trade Commission Act 
A)  Provide examples to national banks of practices that may be abusive 
B)  Advise banks on how they should avoid abusive practices 
C)  Banks should consider appropriate discount rates, credit loss rates, and prepayment rates when valuing these assets 
D)  Show how some abusive lending can involve unfair or deceptive practices and therefore violate the Federal Trade Commission Act

Question 15

In which of the following situations is the bank NOT required to report lost or stolen securities?

Accepted Answer

A)  When bonds were expected to be delivered in person from the local Federal Reserve Bank and were not received 
B)  When stock traded on the over-the-counter exchange (OT
C)  was expected to be received through the mail from a customer's broker 
C)  When securities with no CUSIP numbers were expected from another financial institution 
D)  When stock traded on the New York Stock Exchange (NYS
E)  was expected to be delivered by the issuer's agent 
A)  When bonds were expected to be delivered in person from the local Federal Reserve Bank and were not received 
B)  When stock traded on the over-the-counter exchange (OT
C)  was expected to be received through the mail from a customer's broker 
C)  When securities with no CUSIP numbers were expected from another financial institution 
D)  When stock traded on the New York Stock Exchange (NYS
E)  was expected to be delivered by the issuer's agent

Question 16

Which of the following bank policies does NOT comply with the Interagency Policy Statement on the Retail Sales of Nondeposit Investments?

Accepted Answer

A)  Supervisors and sales personnel will receive compensation based on the volume of sales each department achieves as well as the effectiveness of the department's ability to find suitable investments for customers. 
B)  All bank employees engaged in the sale of nondeposit investments will provide the bank's required disclosures to all customers before the purchase of a nondeposit investment product. 
C)  No teller will discuss nondeposit investment products with a bank customer. 
D)  Tellers and new accounts personnel will receive a $25 fee for all customers referred to the nondeposit investment department on the customer's purchase of an investment product. 
A)  Supervisors and sales personnel will receive compensation based on the volume of sales each department achieves as well as the effectiveness of the department's ability to find suitable investments for customers. 
B)  All bank employees engaged in the sale of nondeposit investments will provide the bank's required disclosures to all customers before the purchase of a nondeposit investment product. 
C)  No teller will discuss nondeposit investment products with a bank customer. 
D)  Tellers and new accounts personnel will receive a $25 fee for all customers referred to the nondeposit investment department on the customer's purchase of an investment product.

Question 17

Which of the following types of security devices is required for each bank, at minimum, under the Bank Protection Act?

Accepted Answer

A)  Full-time security guard 
B)  Tamper-resistant locks on exterior windows and doors 
C)  Vault door made of steel that is at least 3 inches thick 
D)  Bullet-proof glass at all windows 
A)  Full-time security guard 
B)  Tamper-resistant locks on exterior windows and doors 
C)  Vault door made of steel that is at least 3 inches thick 
D)  Bullet-proof glass at all windows

Question 18

FA presents cash to the bank and seeks to wire it to his spouse, RA, in Cub A. The OFAC list identifies RA as a specially designated national. Under OFAC Regulations, what should the bank do?

Accepted Answer

A)  Block the transfer 
B)  Conduct the transfer as requested and take no further action 
C)  Conduct the transfer as requested and notify OFAC immediately 
D)  Conduct the transfer only if the bank determines that Cuba is not a blocked country 
A)  Block the transfer 
B)  Conduct the transfer as requested and take no further action 
C)  Conduct the transfer as requested and notify OFAC immediately 
D)  Conduct the transfer only if the bank determines that Cuba is not a blocked country

Which of the following is NOT a corporate practice required of bank holding companies?

Which of the following is true of a bank's CRA strategic plan?

Which of the following actions is acceptable under the financial reporting regulations?

Requirements-12 CFR 202.2, 202.4, 202.5, 202.6, and 202.13 say that a creditor may not request information about an application's race, color, religion, national origin, or gender except as specifically permitted by ____________or another statute such as the Home Mortgage Disclosure Act.

Supervisory review should also be the part of Subprime Mortgage Lending. It should review:

Which of the following actions is NOT required of a municipal securities principal?

Which of the following statements is true regarding the lessee's ability to purchase the leased property?

By which date must an interest reporting statement be sent to the borrower's last known address?

On which of the following loans must a bank maintain records under the Bank Secrecy Act?

Which of the following is MOST effective in strengthening an anti-money- laundering program involving cash transactions?

If the lender is subject to the mortgage interest reporting requirement, which of the following actions is NOT required?

A bank has a stand-alone ATM in a high crime area. Due to concerns for the safety of individuals using the ATM, management decides to close it. According to branch closing policy statements issued by federal regulators, which of the following actions should the bank take?

The purpose of guidelines for National Banks to Guard against Predatory and Abusive Lending Practices- AL-2003-2 includes all of the following EXCEPT:

In which of the following situations is the bank NOT required to report lost or stolen securities?

Which of the following bank policies does NOT comply with the Interagency Policy Statement on the Retail Sales of Nondeposit Investments?

Which of the following types of security devices is required for each bank, at minimum, under the Bank Protection Act?

FA presents cash to the bank and seeks to wire it to his spouse, RA, in Cub A. The OFAC list identifies RA as a specially designated national. Under OFAC Regulations, what should the bank do?

Certified Trust and Financial Advisor

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Exam 1: Certified Regulatory Compliance Manager

Which of the following is NOT a corporate practice required of bank holding companies?

Which of the following is true of a bank's CRA strategic plan?

Which of the following actions is acceptable under the financial reporting regulations?

Requirements-12 CFR 202.2, 202.4, 202.5, 202.6, and 202.13 say that a creditor may not request information about an application's race, color, religion, national origin, or gender except as specifically permitted by ____________or another statute such as the Home Mortgage Disclosure Act.

Supervisory review should also be the part of Subprime Mortgage Lending. It should review:

Which of the following actions is NOT required of a municipal securities principal?

Which of the following statements is true regarding the lessee's ability to purchase the leased property?

By which date must an interest reporting statement be sent to the borrower's last known address?

On which of the following loans must a bank maintain records under the Bank Secrecy Act?

Which of the following is MOST effective in strengthening an anti-money- laundering program involving cash transactions?

If the lender is subject to the mortgage interest reporting requirement, which of the following actions is NOT required?

A bank has a stand-alone ATM in a high crime area. Due to concerns for the safety of individuals using the ATM, management decides to close it. According to branch closing policy statements issued by federal regulators, which of the following actions should the bank take?

The purpose of guidelines for National Banks to Guard against Predatory and Abusive Lending Practices- AL-2003-2 includes all of the following EXCEPT:

In which of the following situations is the bank NOT required to report lost or stolen securities?

Which of the following bank policies does NOT comply with the Interagency Policy Statement on the Retail Sales of Nondeposit Investments?

Which of the following types of security devices is required for each bank, at minimum, under the Bank Protection Act?

FA presents cash to the bank and seeks to wire it to his spouse, RA, in Cub A. The OFAC list identifies RA as a specially designated national. Under OFAC Regulations, what should the bank do?

Certified Trust and Financial Advisor

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