CCCP Regulatory Compliance & Legal Frameworks 5

Question 1

A compliance officer at a publicly traded company learns that the CEO may have engaged in insider trading. Under SEC Rule 10b-5, which element is NOT required to establish a violation?

Accepted Answer

Proof that the defendant profited from the trade

Answer

SEC Rule 10b-5 does not require proof of actual profit; liability can attach even when the trader loses money, as long as the other elements of fraud in connection with a securities transaction are met.

Question 2

Under the Equal Employment Opportunity laws enforced by the EEOC, which employer action would most likely constitute a 'disparate impact' violation rather than 'disparate treatment'?

Accepted Answer

A neutral hiring test that disproportionately screens out minority applicants without job-related justification

Answer

Disparate impact occurs when a facially neutral employment practice has a disproportionately adverse effect on a protected class and cannot be justified as job-related and consistent with business necessity.

Question 3

When must a company conducting a Reduction in Force (RIF) comply with the Worker Adjustment and Retraining Notification (WARN) Act?

Accepted Answer

When a plant closing or mass layoff affects 50 or more employees at a single site within a 30-day period

Answer

The WARN Act requires employers with 100+ employees to provide 60 calendar days' advance notice of plant closings or mass layoffs affecting 50 or more employees at a single site.

Question 4

Under the Racketeer Influenced and Corrupt Organizations (RICO) Act, what is the minimum number of predicate acts required to establish a 'pattern of racketeering activity'?

Accepted Answer

At least two related acts within a ten-year period

Answer

RICO requires proof of at least two predicate acts of racketeering activity within a ten-year period that are related and constitute or threaten continued criminal activity.

Question 5

A company's compliance team is implementing a new third-party due diligence program. Under the UK Bribery Act 2010, which standard of corporate liability applies to a company whose associated person bribes a foreign official?

Accepted Answer

The company is strictly liable unless it can prove it had 'adequate procedures' to prevent bribery

Answer

The UK Bribery Act creates a strict corporate offense for failing to prevent bribery by an associated person; the only defense is demonstrating that the company had adequate anti-bribery procedures in place.

(CCCP) Certified Corporate Compliance Professional Practice Test

(CCCP) Certified Corporate Compliance Professional Practice Test

CCCP Regulatory Compliance & Legal Frameworks 5