Bank Code Bank Code Regulations 2 — Questions and Answers
Question 1: Which US regulation requires banks to make funds from deposited checks available within certain timeframes?
- Regulation E
- Regulation CC (Expedited Funds Availability Act) (Correct answer)
- Regulation Z
- Regulation D
Correct answer: Regulation CC (Expedited Funds Availability Act)
Regulation CC, implementing the Expedited Funds Availability Act, requires banks to make funds from deposited checks available within specific timeframes based on check type and account history.
Question 2: What must US banks include on wire transfer receipts to comply with CFPB remittance transfer rules?
- The sending bank's CEO name
- Exchange rates, fees, and the amount expected to be received by the recipient (Correct answer)
- The recipient's credit score
- Only the wire reference number
Correct answer: Exchange rates, fees, and the amount expected to be received by the recipient
CFPB remittance transfer rules require banks to disclose exchange rates, all fees, and the amount the recipient will receive, giving consumers full cost transparency.
Question 3: Under the USA PATRIOT Act, what customer information must US banks collect when opening accounts that are linked to routing numbers?
- Only name and address
- Name, date of birth, address, and government-issued ID number (CIP requirements) (Correct answer)
- Employment history and income
- Credit score and social media profiles
Correct answer: Name, date of birth, address, and government-issued ID number (CIP requirements)
The USA PATRIOT Act's Customer Identification Program (CIP) requires banks to collect name, date of birth, address, and government-issued ID number before opening accounts.
Question 4: What is FinCEN's role in relation to bank routing numbers and wire transfers?
- FinCEN assigns routing numbers to banks
- FinCEN collects and analyzes financial transaction data including wire transfers to detect money laundering (Correct answer)
- FinCEN processes all wire transfers
- FinCEN insures wire transfer funds
Correct answer: FinCEN collects and analyzes financial transaction data including wire transfers to detect money laundering
FinCEN (Financial Crimes Enforcement Network) collects and analyzes financial transaction reports — including wire transfer data — to identify and combat money laundering and other financial crimes.
Question 5: What is a Suspicious Activity Report (SAR) in the context of wire transfers?
- A report filed when a wire transfer fails
- A confidential report banks must file with FinCEN when a transaction appears suspicious (Correct answer)
- A public disclosure of fraudulent wire transfers
- An IRS tax form for large transfers
Correct answer: A confidential report banks must file with FinCEN when a transaction appears suspicious
A SAR is a confidential report that banks must file with FinCEN when a transaction — including wire transfers — appears suspicious or potentially related to illegal activity.
Question 6: Under the Gramm-Leach-Bliley Act, how must banks protect customers' routing and account number information?
- By encrypting all data stored in the cloud only
- By implementing security programs to protect nonpublic personal financial information (Correct answer)
- By storing data only in physical form
- By sharing data only with government agencies
Correct answer: By implementing security programs to protect nonpublic personal financial information
The Gramm-Leach-Bliley Act requires financial institutions to implement comprehensive security programs to protect customers' nonpublic personal financial information, including account and routing details.
Bank Code Bank Code Regulations 2
Which US regulation requires banks to make funds from deposited checks available within certain timeframes?