APRP APRP Quality & Compliance 3

Question 1

Under Regulation E, how many business days does a financial institution have to investigate a consumer's reported unauthorized electronic fund transfer?

Accepted Answer

10 business days

Answer

Regulation E requires institutions to complete an EFT error investigation within 10 business days, or provisionally credit the consumer's account while continuing investigation for up to 45 days.

Question 2

What is the primary purpose of an acquirer's merchant underwriting process from a compliance standpoint?

Accepted Answer

To assess and mitigate financial and fraud risk before onboarding a merchant

Answer

Merchant underwriting evaluates a prospective merchant's financial stability, business type, and risk profile to prevent acquirers from bearing undue liability.

Question 3

A payments company's compliance officer discovers that transaction monitoring rules have not been updated in 18 months despite the emergence of new fraud schemes. This is best described as a failure in:

Accepted Answer

Control environment maintenance

Answer

Failure to update controls to address evolving risks represents a breakdown in the control environment, which requires ongoing maintenance and tuning.

Question 4

Which of the following best defines 'three lines of defense' in a payments risk management framework?

Accepted Answer

Business operations, risk/compliance functions, and internal audit

Answer

The three lines of defense model assigns risk ownership to business lines (1st), oversight to risk and compliance functions (2nd), and independent assurance to internal audit (3rd).

Question 5

What is the significance of the 'MATCH' (Member Alert to Control High-Risk) list for merchant acquirers?

Accepted Answer

It identifies merchants previously terminated for cause, such as fraud or excessive chargebacks

Answer

The MATCH list is a shared database acquirers must query before onboarding a new merchant to check if the merchant was previously terminated for risk-related reasons.

APRP - Accredited Payments Risk Professional Practice Test

APRP - Accredited Payments Risk Professional Practice Test

APRP APRP Quality & Compliance 3