CORES Regulatory Compliance & Industry Standards 5

Question 1

Under the OCC's Heightened Standards for large banks (12 CFR Part 30, Appendix D), front-line units are PRIMARILY responsible for:

Accepted Answer

Owning and managing risks within their business activities

Answer

Under OCC Heightened Standards, front-line units own and manage the risks inherent in their business activities as the first line of defense.

Question 2

Which of the following is NOT a required element of a Suspicious Activity Report (SAR) filing under FinCEN regulations?

Accepted Answer

The filing institution's assessment of criminal intent

Answer

SAR filers are not required to—and generally should not—opine on criminal intent; they report facts and why the activity is suspicious.

Question 3

An operational risk manager is reviewing a new product approval process. Which regulatory guidance BEST supports requiring a formal risk assessment before product launch?

Accepted Answer

OCC Bulletin 2017-43 on New, Modified, or Expanded Bank Products and Services

Answer

OCC Bulletin 2017-43 specifically addresses risk management expectations for new, modified, or expanded bank products and services.

Question 4

The 'comply or explain' principle found in many corporate governance codes requires that companies:

Accepted Answer

Either follow the code's provisions or publicly disclose and explain any departures

Answer

Under 'comply or explain,' companies that deviate from governance code provisions must publicly explain their rationale, providing market transparency.

Question 5

A bank receives a matter requiring attention (MRA) from its primary regulator citing weaknesses in its operational risk framework. The MOST appropriate immediate response is to:

Accepted Answer

Develop a detailed remediation plan with milestones and present it to the regulator

Answer

MRAs require a timely, substantive remediation plan with defined milestones submitted to the regulator demonstrating the bank's commitment to corrective action.

(CORES) Certified Operational Risk Executive Specialist Practice Test

(CORES) Certified Operational Risk Executive Specialist Practice Test

CORES Regulatory Compliance & Industry Standards 5