CCT Key Federal Regulations 4 — Questions and Answers
Question 1: Under the Gramm-Leach-Bliley Act (GLBA), financial institutions must provide privacy notices to customers:
- Only when initially establishing the customer relationship
- At account opening and annually thereafter (Correct answer)
- Every time personal data is shared with a third party
- Only upon customer request
Correct answer: At account opening and annually thereafter
GLBA requires financial institutions to provide initial and annual privacy notices describing their information sharing practices.
Question 2: A Suspicious Activity Report (SAR) under the BSA must be filed within how many days of detecting suspicious activity?
- 15 days
- 30 days (Correct answer)
- 60 days
- 90 days
Correct answer: 30 days
Financial institutions must file a SAR with FinCEN within 30 calendar days of detecting a suspicious transaction (60 days if no suspect is identified initially).
Question 3: Under the Fair Credit Reporting Act (FCRA), consumers have the right to receive one free credit report per year from each nationwide credit bureau under which program?
- CreditSafe
- AnnualCreditReport.com (Correct answer)
- FICO Score Access Program
- FinCEN Credit Portal
Correct answer: AnnualCreditReport.com
AnnualCreditReport.com is the FCRA-mandated centralized service where consumers can request one free report annually from Equifax, Experian, and TransUnion.
Question 4: The Military Lending Act (MLA) caps the Military Annual Percentage Rate (MAPR) for covered loans to active-duty servicemembers at:
- 18%
- 21%
- 28%
- 36% (Correct answer)
Correct answer: 36%
The MLA limits the MAPR on covered consumer credit products extended to active-duty servicemembers and their dependents to 36%.
Question 5: Which regulation implements the Truth in Savings Act (TISA) for depository institutions?
- Regulation B
- Regulation DD (Correct answer)
- Regulation E
- Regulation Z
Correct answer: Regulation DD
Regulation DD implements TISA, requiring depository institutions to disclose account terms and conditions including interest rates and fees.
Question 6: Under the Real Estate Settlement Procedures Act (RESPA), a 'kickback' or fee-splitting arrangement for referrals of settlement services is:
- Permitted if disclosed on the Loan Estimate
- Prohibited regardless of disclosure (Correct answer)
- Allowed between affiliated businesses only
- Permissible if under $50 in value
Correct answer: Prohibited regardless of disclosure
RESPA Section 8 prohibits kickbacks and unearned fee-splitting in residential real estate transactions regardless of disclosure.
Question 7: The Dodd-Frank Act's Volcker Rule primarily prohibits banks from:
- Offering derivatives to retail customers
- Engaging in proprietary trading and owning hedge funds (Correct answer)
- Making mortgage loans to subprime borrowers
- Selling insurance products through bank branches
Correct answer: Engaging in proprietary trading and owning hedge funds
The Volcker Rule prohibits insured depository institutions and their affiliates from engaging in short-term proprietary trading and from owning or sponsoring hedge funds.
CCT Key Federal Regulations 4
Under the Gramm-Leach-Bliley Act (GLBA), financial institutions must provide privacy notices to customers: