CRA Regulatory Compliance & Ethical Standards 5

Question 1

The concept of 'regulatory capital arbitrage' refers to:

Accepted Answer

Using regulatory differences across jurisdictions to reduce required capital below the spirit of the rules

Answer

Regulatory capital arbitrage involves structuring transactions or operations to minimize required capital while circumventing the intent of capital adequacy regulations.

Question 2

Under the Americans with Disabilities Act (ADA), which standard governs web accessibility for financial institutions?

Accepted Answer

WCAG 2.1 AA (Web Content Accessibility Guidelines)

Answer

Courts and the DOJ have consistently applied WCAG 2.1 Level AA as the standard for ADA-compliant web accessibility for financial services websites.

Question 3

A Certified Risk Architect who discovers a material misstatement in a risk report they previously certified has an ethical obligation to:

Accepted Answer

Promptly notify appropriate parties and issue a corrected report

Answer

Professional ethics require prompt notification and correction of material misstatements in certified reports, regardless of reputational inconvenience.

Question 4

The 'four-eyes principle' in compliance and risk governance requires that:

Accepted Answer

Significant decisions or transactions require approval by at least two authorized individuals

Answer

The four-eyes principle mandates that consequential actions require review and approval by a second authorized person to prevent errors and fraud.

Question 5

The OCC's 'heightened standards' guidance (12 CFR Part 30, Appendix D) applies to national banks and federal savings associations with assets exceeding:

Accepted Answer

$100 billion

Answer

OCC's heightened standards for risk governance apply to covered institutions with average total consolidated assets of $50 billion or more—though often cited as $50B, the OCC's own threshold is $50B for initial applicability.

(CRA) Certified Risk Architect Practice Test

(CRA) Certified Risk Architect Practice Test

CRA Regulatory Compliance & Ethical Standards 5