Exam 1: Certified Regulatory Compliance Manager

First National is developing a consumer checking account that can access a line of credit. This is the first time the bank has ever had such a product, although this type of credit facility has been popular with other banks in town. To determine what interest rate to charge on this account, an officer of First National called some of his friends at other local banks offering this type of credit and asked several questions, including the interest rate charged on this type of account and what internal factors the banks use to set the rate. After obtaining this information, First National determines that it could charge approximately 2 percent more than it originally planned. Is there anything wrong with this course of action?

Following mentioned are the responsibilities of: 1. Must notify the bank, either orally or in writing, of error within 60 days: • Of the institution's transmission of a statement or other documentation on which the error first appears or • Of receiving additional information or clarification provided pursuant to the consumer's request 2. Consumer's notification should include the following items • Consumer's name and account number or information that allows the institution to identify the consumer's name or account number • Consumer's belief and reasons for the belief that an error exists and, if possible, the type, date, and amount of the error (this information does not have to be given if the consumer is simply requesting further information or clarification)

An oral or written request for credit made in accordance with the creditor's procedures for the type of credit requested. Information entered into and retained by a computer system qualifies as a written application. It is called:

Below mentioned is the necessary information that should be included in the ___________. Risk of payment shock-potential payment increases; how the new payment will be calculated when the introductory rate expires Ramifications of prepayment penalties-how they will be calculated, when they will be imposed Ramifications of balloon payments Ramifications of the lack of escrowing for taxes and insurance-who is responsible for paying taxes and insurance and the fact that their costs may be substantial Cost of reduced documentation loans-whether there is a pricing premium required

Which of the following loans is clearly NOT subject to the IRS mortgage interest reporting requirement?

The following mentioned points are actually _______________. • Reserve Banks may rely on numbers given in a payment order to identify an intermediary or beneficiary bank • Reserve Banks, when acting as beneficiary's bank, may rely on the number in the payment order that identifies the beneficiary

First National Bank has made a loan to Mr. Good, secured by margin stock, to purchase margin stock. He trades stocks frequently, makes substitutions on loan collateral regularly, and sometimes withdraws collateral and does not replace it. Must FNB ensure that margin requirements are met after every substitution and withdrawal?

On which of the following adjustable-rate loans must the bank use an index beyond its control?

For example on a 0-5 scale: The risk trend shows the direction of risk and probable change to risk over the next 12 months. A trend toward increasing risk means that

By presentation or transmission of an item a Reserve Bank warrants to a subsequent collecting bank and paying bank that:

Which of the following customers may be exempted under Phase II of the Bank Secrecy Act?

In the small bank performance standard, which of the following is NOT a criterion?

ACME Bank would like its tellers to help sell insurance products to new and existing customers. The tellers would refer customers to personal bankers who have insurance licenses from the state. The bank would like to reward tellers by giving them a small percentage of the commission for each policy sold where the sale resulted from a referral. Which of the following statements presents ACME's biggest concern in complying with the Consumer Protection in Sales of Insurance regulation?

Bank A offers safe deposit services in a vault area that contains a door too narrow for wheelchair passage. The bank cannot widen the door because of the vault construction. Therefore, when a customer in a wheelchair needs access to a safe deposit box the customer cannot enter the vault. The bank provides viewing rooms for all safe deposit customers, and one of these rooms has a door wide enough for a disabled customer to enter. Which of the following must the bank do to provide safe deposit box service to wheelchair customers?

Which of the following must be included in a branch closing notice to a bank's regulatory agency?

According to FDIC Guidance on Spousal Signature Provisions, if the creditor requires the spouse's signature on an instrument that imposes personal liability, the creditor's belief should be:

First National Bank made the following loans to Mr. James Wilson during the previous calendar year: • Loan A, made on February 2, is a loan for purchasing margin stock and is secured by margin stock • Loan B, made on March 15, is also for purchasing margin stock and is secured by margin stock • Loan C, made on June 30, is an unsecured loan for purchasing margin stock • Loan D, made on September 10, is for purchasing a car, secured by the car All the loans are still outstanding at the end of the year. Which of the loans must be combined for purposes of the margin requirements of Regulation U?

A recent audit revealed that the bank's personal trust division was failing to determine whether securities being accepted from new trust customers have been reported as lost or stolen. To address the root cause of this problem, what should the compliance officer do FIRST?

To stop a payment of a preauthorized transfer, consumer must notify the institution or in writing at least:

Records regarding compliance with Regulation M must be kept for how long?