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Regulatory Compliance & Guidelines Flashcards

7 cards from real CSC practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Regulatory Compliance & Guidelines flashcards as text

  1. A senior consultant is helping a firm implement a third-party risk management (TPRM) program. Under OCC guidance, which vendor relationship requires the most rigorous due diligence?

    Answer: A vendor delivering critical banking activities or handling sensitive customer data

    OCC guidance requires the most rigorous due diligence for third-party relationships involving critical activities or access to sensitive customer data.

  2. Which whistleblower protection law applies specifically to employees who report violations of federal securities laws to the SEC?

    Answer: Dodd-Frank Act Section 922 (SEC Whistleblower Program)

    Dodd-Frank Section 922 established the SEC Whistleblower Program, offering financial awards (10–30% of sanctions over $1M) and strong anti-retaliation protections.

  3. In developing a compliance risk assessment, what is the primary purpose of mapping compliance risks to business processes?

    Answer: To identify where regulatory obligations intersect with operations so controls can be targeted effectively

    Mapping compliance risks to business processes enables organizations to deploy controls precisely where violations are most likely to occur.

  4. A financial services client asks about the FINRA Rule 4370 Business Continuity Plan (BCP) requirements. What is the key deliverable FINRA mandates?

    Answer: A written BCP that addresses how the firm will respond to significant business disruptions

    FINRA Rule 4370 requires firms to have a written BCP addressing how they will respond to significant business disruptions and meet obligations to customers.

  5. Under the False Claims Act, what percentage of government recoveries can a whistleblower (relator) receive when the government intervenes in a qui tam lawsuit?

    Answer: 15–25%

    When the government intervenes in a False Claims Act qui tam case, the relator typically receives between 15% and 25% of the government's recovery.

  6. A consultant is reviewing a company's conflict of interest policy. Which scenario presents the HIGHEST compliance risk under SEC and corporate governance standards?

    Answer: A board member who votes on a contract with a company in which they hold a significant financial interest without disclosure

    A board member voting on matters where they have an undisclosed financial interest is a textbook conflict of interest that can violate fiduciary duty and SEC disclosure rules.

  7. Which framework, developed by COSO, is most widely used to design and evaluate internal controls in compliance with SOX requirements?

    Answer: COSO Internal Control – Integrated Framework

    The COSO Internal Control – Integrated Framework is the most widely adopted framework for designing and assessing internal controls under SOX.