CRCM Certified Regulatory Compliance Manager MCQ 4 — Questions and Answers
Question 1: Under the Fair Debt Collection Practices Act (FDCPA), a debt collector may NOT contact a consumer:
- On weekdays between 9 AM and 5 PM
- Before 8 AM or after 9 PM local time (Correct answer)
- At the consumer's place of employment under any circumstance
- More than twice per week
Correct answer: Before 8 AM or after 9 PM local time
The FDCPA prohibits debt collectors from contacting consumers before 8 AM or after 9 PM in the consumer's local time zone.
Question 2: Which of the following best describes 'structured transactions' or 'structuring' under BSA/AML regulations?
- Breaking up large cash transactions specifically to evade CTR reporting requirements (Correct answer)
- Organizing multiple wire transfers for efficiency
- Creating multiple accounts to earn higher interest rates
- Filing multiple SARs for the same customer
Correct answer: Breaking up large cash transactions specifically to evade CTR reporting requirements
Structuring involves deliberately breaking up currency transactions into amounts below $10,000 to avoid triggering CTR filing requirements, which is itself a federal crime.
Question 3: Regulation E primarily governs:
- Mortgage loan disclosures
- Electronic fund transfers (Correct answer)
- Equal credit opportunities
- Securities transactions
Correct answer: Electronic fund transfers
Regulation E implements the Electronic Fund Transfer Act and establishes the rights and liabilities of consumers and financial institutions for EFTs.
Question 4: A bank's BSA/AML compliance program must include which four pillars as required by federal regulation?
- Internal controls, independent testing, designated BSA officer, and customer due diligence (Correct answer)
- Policies, procedures, training, and audit
- Board oversight, risk assessment, monitoring, and reporting
- Customer identification, due diligence, enhanced due diligence, and SAR filing
Correct answer: Internal controls, independent testing, designated BSA officer, and customer due diligence
The four required BSA/AML program pillars are internal controls, independent testing (audit), a designated BSA compliance officer, and training.
Question 5: Under the Truth in Lending Act (TILA) and Regulation Z, the right of rescission applies to which type of transaction?
- Purchase-money mortgage for a primary residence
- Non-purchase refinance secured by the consumer's primary dwelling (Correct answer)
- Home equity loan used for business purposes
- Reverse mortgage transaction
Correct answer: Non-purchase refinance secured by the consumer's primary dwelling
The three-day right of rescission applies to non-purchase credit transactions secured by the consumer's principal dwelling, such as refinances and HELOCs.
Question 6: A compliance officer conducting a Fair Lending review finds that the bank's pricing model results in higher rates for a protected class even though lending policies appear neutral on their face. This best describes which legal theory?
- Disparate treatment
- Disparate impact (Correct answer)
- Predatory lending
- Redlining
Correct answer: Disparate impact
Disparate impact occurs when a facially neutral policy or practice disproportionately harms a protected class without business justification.
Question 7: The Bank Secrecy Act requires financial institutions to retain records of funds transfers of $3,000 or more (the 'Travel Rule'). What information must 'travel' with the payment order?
- Only the originator's account number
- Originator's name, address, and account number plus beneficiary's name and account number (Correct answer)
- Social Security numbers of both parties
- Only the beneficiary's routing number and account number
Correct answer: Originator's name, address, and account number plus beneficiary's name and account number
The Travel Rule requires that specific originator and beneficiary identifying information accompany funds transfers of $3,000 or more to help law enforcement trace illicit funds.
CRCM Certified Regulatory Compliance Manager MCQ 4
Under the Fair Debt Collection Practices Act (FDCPA), a debt collector may NOT contact a consumer: