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Regulatory Compliance & Risk Management Flashcards

7 cards from real CBO practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Regulatory Compliance & Risk Management flashcards as text

  1. What is the primary function of the Foreign Corrupt Practices Act (FCPA) for US businesses?

    Answer: It prohibits US companies from bribing foreign government officials

    The FCPA makes it illegal for US persons and businesses to bribe foreign government officials to obtain or retain business.

  2. Under the Fair Credit Reporting Act (FCRA), what must an employer do before taking adverse action based on a background check?

    Answer: Provide the applicant a copy of the report and a summary of rights

    Before taking adverse employment action based on a consumer report, employers must give the applicant the report and an FCRA rights summary so they can dispute inaccuracies.

  3. Which of the following is an example of a preventive control in a compliance program?

    Answer: Employee training that teaches how to avoid conflicts of interest

    Preventive controls are designed to stop a violation or error from occurring, and training is a classic example of this type of control.

  4. A business experiences a workplace accident and files a workers' compensation claim. Which risk management technique does workers' compensation insurance represent?

    Answer: Risk transfer

    Workers' compensation insurance transfers the financial risk of workplace injuries from the employer to the insurer.

  5. What is 'regulatory arbitrage' in a compliance context?

    Answer: Exploiting differences between regulatory regimes to gain a competitive or cost advantage

    Regulatory arbitrage occurs when a business structures activities to take advantage of gaps or differences between regulatory requirements across jurisdictions.

  6. Which element is most critical to an effective corporate compliance program according to the US Department of Justice guidelines?

    Answer: Tone at the top — genuine commitment from senior leadership

    DOJ guidance consistently emphasizes that leadership commitment—'tone at the top'—is the most critical factor in whether a compliance program is genuinely effective.

  7. A business operating in the EU must appoint a Data Protection Officer (DPO) under the GDPR in which situation?

    Answer: When the business's core activities require large-scale systematic monitoring of individuals

    GDPR requires a DPO when an organization's core activities involve large-scale systematic monitoring of data subjects or large-scale processing of special category data.