CFE CFE Consumer Protection & Lending Compliance 2

Question 1

Which federal agency is primarily responsible for enforcing consumer financial protection laws at large banks?

Accepted Answer

Consumer Financial Protection Bureau (CFPB)

Answer

The CFPB, created by the Dodd-Frank Act, has primary supervisory and enforcement authority over consumer financial protection laws at large financial institutions.

Question 2

The Fair Credit Reporting Act (FCRA) gives consumers the right to:

Accepted Answer

Access a free credit report annually from each major bureau

Answer

FCRA entitles consumers to one free credit report per year from each of the three major credit bureaus (Equifax, Experian, TransUnion) through AnnualCreditReport.com.

Question 3

What does 'Regulation E' primarily govern?

Accepted Answer

Electronic fund transfers and consumer debit card transactions

Answer

Regulation E implements the Electronic Fund Transfer Act and establishes consumer rights and bank obligations related to electronic transfers, ATMs, and debit cards.

Question 4

Under the Home Mortgage Disclosure Act (HMDA), financial institutions must collect and report data primarily to:

Accepted Answer

Detect and deter discriminatory lending patterns

Answer

HMDA requires institutions to collect and disclose mortgage application data to help regulators and the public identify discriminatory lending patterns and ensure fair lending.

Question 5

Which lending practice involves repeatedly refinancing a loan to generate fees while providing no net benefit to the borrower?

Accepted Answer

Loan flipping (predatory churning)

Answer

Loan flipping is a predatory practice where lenders repeatedly refinance loans primarily to collect new fees, stripping equity from the borrower without providing genuine benefit.

(CFE) Certified Financial Examiner Practice Test

(CFE) Certified Financial Examiner Practice Test

CFE CFE Consumer Protection & Lending Compliance 2