Banking Exam Banking Regulations and Ethics 3

Question 1

What is the primary purpose of the Volcker Rule enacted under Dodd-Frank?

Accepted Answer

Prohibit banks from proprietary trading and owning hedge funds

Answer

The Volcker Rule prohibits bank holding companies from engaging in proprietary trading and from owning or investing in hedge funds or private equity funds.

Question 2

Under the Fair Debt Collection Practices Act (FDCPA), a debt collector may NOT contact a debtor:

Accepted Answer

Before 8 a.m. or after 9 p.m. local time

Answer

The FDCPA prohibits debt collectors from contacting debtors before 8 a.m. or after 9 p.m. in the debtor's local time zone.

Question 3

A Suspicious Activity Report (SAR) must be filed within how many days of detecting suspicious activity?

Accepted Answer

30 days

Answer

Financial institutions must file a SAR within 30 calendar days of initially detecting suspicious activity, or 60 days if no suspect is identified.

Question 4

Which ethics principle requires bank employees to maintain client confidentiality and not disclose account information to unauthorized parties?

Accepted Answer

Duty of confidentiality

Answer

The duty of confidentiality obligates bank employees to protect customer information and not disclose it to unauthorized individuals or entities.

Question 5

The Truth in Lending Act (TILA) primarily requires lenders to disclose:

Accepted Answer

The annual percentage rate and total cost of credit

Answer

TILA mandates disclosure of the annual percentage rate (APR) and total cost of credit so consumers can compare loan offers effectively.

Banking Exam Practice Test

Banking Exam Practice Test

Banking Exam Banking Regulations and Ethics 3