CRB Risk Management & Fraud Prevention 5

Question 1

The 'three lines of defense' model in banking assigns primary responsibility for identifying and managing risk to:

Accepted Answer

Business line management

Answer

The first line of defense consists of business line managers and staff who own and manage risks in their day-to-day operations.

Question 2

A customer receives a call from someone claiming to be their bank and is asked to confirm their account number and PIN to prevent fraud. This attack is called:

Accepted Answer

Vishing

Answer

Vishing (voice phishing) uses phone calls to trick individuals into revealing sensitive account information by impersonating trusted institutions.

Question 3

Which regulatory requirement mandates that banks establish a written Customer Identification Program (CIP)?

Accepted Answer

USA PATRIOT Act Section 326

Answer

Section 326 of the USA PATRIOT Act requires financial institutions to implement a written CIP to verify the identity of customers opening accounts.

Question 4

A bank employee bypasses the dual-control requirement and processes a large wire transfer unilaterally. Which risk management control has failed?

Accepted Answer

Segregation of duties

Answer

Segregation of duties requires that no single employee can execute a sensitive transaction without another authorized person's involvement, preventing fraud and errors.

Question 5

Operational risk differs from credit risk in that operational risk arises from:

Accepted Answer

Failures in people, processes, systems, or external events

Answer

Operational risk is defined by the Basel framework as risk resulting from inadequate or failed internal processes, people, systems, or external events.

(CRB) Certified Retail Banker Practice Test

(CRB) Certified Retail Banker Practice Test

CRB Risk Management & Fraud Prevention 5