CRCM Deposit Compliance and Regulatory Examinations 1 — Questions and Answers
Question 1: Regulation CC (Expedited Funds Availability Act) requires banks to make funds from local check deposits available no later than:
- Same business day
- Next business day
- Second business day (Correct answer)
- Fifth business day
Correct answer: Second business day
Regulation CC generally requires that funds from local checks be available no later than the second business day after deposit.
Question 2: Under Regulation DD (Truth in Savings), annual percentage yield (APY) must reflect:
- The simple interest rate offered on the account
- The effect of compounding over a full year (Correct answer)
- The average rate paid over the prior 12 months
- The rate after deducting all account maintenance fees
Correct answer: The effect of compounding over a full year
APY is a standardized rate that includes the effect of compounding over a 365-day year, allowing consumers to compare savings accounts.
Question 3: Under the National Flood Insurance Program (NFIP), lenders must require flood insurance for loans secured by properties located in:
- Any coastal state
- A Special Flood Hazard Area (SFHA) as designated by FEMA (Correct answer)
- Any property with a basement
- Any property built before 1980
Correct answer: A Special Flood Hazard Area (SFHA) as designated by FEMA
Federal law requires lenders to mandate flood insurance for improved real estate or mobile homes located in a FEMA-designated Special Flood Hazard Area.
Question 4: Regulation E requires that periodic statements for accounts with electronic fund transfer capability be provided:
- Quarterly
- Monthly if there is an electronic transfer during the cycle (Correct answer)
- Annually for inactive accounts
- Only on customer request
Correct answer: Monthly if there is an electronic transfer during the cycle
Regulation E requires monthly periodic statements for accounts that had an EFT during the statement period.
Question 5: Which of the following is an 'exception hold' permitted under Regulation CC?
- A hold placed on all payroll deposits regardless of amount
- A hold placed on a deposit because the depositor has a repeatedly overdrawn account (Correct answer)
- A hold on all deposits made after 3 p.m.
- A hold on cashier's checks for first-time account holders only
Correct answer: A hold placed on a deposit because the depositor has a repeatedly overdrawn account
Regulation CC allows exception holds for accounts with repeated overdrafts, among other exceptions, extending the standard availability schedule.
Question 6: Under the USA PATRIOT Act Section 326, a Customer Identification Program (CIP) must, at minimum, collect which information for individual accounts?
- Credit score and employment history
- Name, date of birth, address, and identification number (Correct answer)
- Net worth and source of funds
- Employment and banking history
Correct answer: Name, date of birth, address, and identification number
The CIP minimum requirements for individuals are name, date of birth, address, and an identification number (e.g., SSN or passport number).
CRCM Deposit Compliance and Regulatory Examinations 1
Regulation CC (Expedited Funds Availability Act) requires banks to make funds from local check deposits available no later than: