Banking Exam Banking Regulations and Compliance 4

Question 1

Which act established the FDIC and the federal deposit insurance system?

Accepted Answer

The Glass-Steagall Act of 1933

Answer

The Banking Act of 1933, commonly known as the Glass-Steagall Act, created the FDIC to restore public confidence in the banking system after widespread bank failures during the Great Depression.

Question 2

Under Regulation D, what types of accounts are subject to reserve requirements?

Accepted Answer

Transaction accounts such as demand deposits

Answer

Regulation D historically imposed reserve requirements primarily on transaction accounts (demand deposits and NOW accounts), though the Federal Reserve reduced these requirements to zero in 2020.

Question 3

What is 'structuring' in the context of banking compliance?

Accepted Answer

Breaking up large cash transactions to evade CTR reporting thresholds

Answer

Structuring, also called 'smurfing,' involves deliberately breaking transactions into smaller amounts to avoid the $10,000 CTR filing requirement, and is a federal crime.

Question 4

Under the Fair Credit Reporting Act (FCRA), how long can most negative information remain on a consumer's credit report?

Accepted Answer

7 years

Answer

The FCRA generally limits most negative credit information, such as late payments and collections, to 7 years from the date of the first delinquency.

Question 5

Which of the following best describes the purpose of the Office of Foreign Assets Control (OFAC)?

Accepted Answer

Administering and enforcing economic and trade sanctions

Answer

OFAC, a division of the U.S. Treasury, administers sanctions programs targeting foreign countries, entities, and individuals to advance U.S. national security and foreign policy objectives.

Banking Exam Practice Test

Banking Exam Practice Test

Banking Exam Banking Regulations and Compliance 4