Capital One Assessment Test Standards and Regulations 2 — Questions and Answers
Question 1: Under the Bank Secrecy Act (BSA), financial institutions must file a Currency Transaction Report (CTR) for cash transactions exceeding what threshold?
- $5,000
- $10,000 (Correct answer)
- $25,000
- $50,000
Correct answer: $10,000
The BSA requires filing a CTR for cash transactions exceeding $10,000 in a single day.
Question 2: Which regulation prohibits financial institutions from discriminating in credit decisions based on race, color, religion, national origin, sex, marital status, or age?
- Fair Credit Reporting Act (FCRA)
- Truth in Lending Act (TILA)
- Equal Credit Opportunity Act (ECOA) (Correct answer)
- Community Reinvestment Act (CRA)
Correct answer: Equal Credit Opportunity Act (ECOA)
The Equal Credit Opportunity Act (ECOA) prohibits creditors from discriminating against applicants based on protected characteristics.
Question 3: What does the Gramm-Leach-Bliley Act (GLBA) primarily require financial institutions to do?
- Report suspicious transactions to FinCEN
- Explain their information-sharing practices and protect customers' private financial data (Correct answer)
- Maintain minimum capital reserve ratios
- Provide free credit scores to all customers annually
Correct answer: Explain their information-sharing practices and protect customers' private financial data
The GLBA requires financial institutions to explain their privacy policies and safeguard customers' nonpublic personal information.
Question 4: A customer makes multiple cash deposits of $9,500 on consecutive days to avoid CTR filing. This practice is known as:
- Layering
- Structuring (smurfing) (Correct answer)
- Integration
- Placement
Correct answer: Structuring (smurfing)
Structuring, also called smurfing, is the illegal practice of breaking up transactions to evade BSA reporting thresholds.
Question 5: The Community Reinvestment Act (CRA) was enacted primarily to address which issue?
- Predatory lending by non-bank mortgage companies
- Redlining and financial institutions' failure to serve low- and moderate-income communities (Correct answer)
- Excessive credit card interest rates charged to minority borrowers
- Lack of ATM access in rural communities
Correct answer: Redlining and financial institutions' failure to serve low- and moderate-income communities
The CRA was enacted to encourage banks to meet the credit needs of all communities they serve, including low- and moderate-income neighborhoods.
Question 6: Under Regulation E, if a consumer reports an unauthorized electronic fund transfer within 2 business days of learning of the loss or theft, the consumer's maximum liability is:
- $0
- $50 (Correct answer)
- $500
- Unlimited
Correct answer: $50
If reported within 2 business days, the consumer's liability is capped at $50 under Regulation E.
Question 7: Which federal agency is primarily responsible for enforcing consumer financial protection laws and has supervisory authority over Capital One?
- Federal Trade Commission (FTC)
- Securities and Exchange Commission (SEC)
- Consumer Financial Protection Bureau (CFPB) (Correct answer)
- Federal Deposit Insurance Corporation (FDIC)
Correct answer: Consumer Financial Protection Bureau (CFPB)
The CFPB has primary enforcement and supervisory authority over large banks like Capital One for consumer financial protection laws.
Capital One Assessment Test Standards and Regulations 2
Under the Bank Secrecy Act (BSA), financial institutions must file a Currency Transaction Report (CTR) for cash transactions exceeding what threshold?