Professional Ethics in Banking Flashcards
7 cards from real CBP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Professional Ethics in Banking flashcards as text
A bank teller notices a customer regularly deposits just under $10,000 in cash to avoid triggering a Currency Transaction Report (CTR). This activity is best described as:
Answer: Structuring, which is illegal under the Bank Secrecy Act
Deliberately breaking up transactions to stay below reporting thresholds is called structuring, which is a federal crime under the Bank Secrecy Act.
Which ethical principle requires that bankers provide customers with clear, accurate, and complete information about products and fees?
Answer: Transparency
Transparency obligates banking professionals to ensure customers have all material information needed to make informed financial decisions.
A branch manager instructs staff to open accounts for customers without their knowledge to meet sales targets. This practice most directly violates:
Answer: Customer consent and ethical sales conduct standards
Opening accounts without customer consent is a fraudulent practice that violates ethical sales conduct and consumer protection regulations.
An ethical banking culture that encourages employees to raise concerns without fear of retaliation is characterized by:
Answer: A strong 'speak up' or whistleblower protection culture
Whistleblower protection and a 'speak up' culture are essential for identifying and correcting ethical violations early.
In the context of banking ethics, 'suitability' means that a financial product must be:
Answer: Appropriate for the specific customer's needs, risk tolerance, and financial situation
Suitability requires that products recommended to customers align with their individual financial profile, goals, and risk tolerance.
A bank employee uses customer contact information obtained through work to solicit personal business on the side. This conduct violates:
Answer: Customer confidentiality, fiduciary duty, and conflict of interest rules
Using confidential customer data for personal gain breaches confidentiality obligations, fiduciary duty, and creates a clear conflict of interest.
When a bank's ethical standards and a client's explicit request conflict, the banker should:
Answer: Follow ethical and regulatory standards, even if it means declining the request
Ethical and regulatory obligations take precedence over client preferences; the banker must decline requests that violate these standards.