CTP Regulatory Compliance and Ethics

Question 1

Which regulatory body has primary oversight of swap markets under the Dodd-Frank Wall Street Reform and Consumer Protection Act?

Accepted Answer

Commodity Futures Trading Commission (CFTC)

Answer

Securities and Exchange Commission (SEC)

Answer

Federal Reserve Board

Answer

Office of the Comptroller of the Currency (OCC)

Question 2

Under Basel III, what is the minimum Common Equity Tier 1 (CET1) capital ratio that banks must maintain as a percentage of risk-weighted assets?

Accepted Answer

4.5%

Answer

2.0%

Answer

4.0%

Answer

6.0%

Question 3

What does Sarbanes-Oxley Act Section 404 primarily require of public companies?

Accepted Answer

Management assessment and auditor attestation of internal controls over financial reporting

Answer

Annual disclosure of executive compensation packages

Answer

Quarterly CEO certification of cash flow statements

Answer

Real-time disclosure of all material events within 48 hours

Question 4

Which U.S. regulation primarily requires financial institutions to implement Anti-Money Laundering (AML) programs and Know Your Customer (KYC) procedures?

Accepted Answer

Bank Secrecy Act (BSA)

Answer

Gramm-Leach-Bliley Act

Answer

Electronic Funds Transfer Act

Answer

Sarbanes-Oxley Act

Question 5

What is the primary purpose of filing a Suspicious Activity Report (SAR) with FinCEN?

Accepted Answer

To alert regulators about transactions that may indicate money laundering or financial fraud

Answer

To report large cash transactions exceeding $10,000 in a single day

Answer

To disclose foreign bank account holdings to the Treasury Department

Answer

To report wire transfers exceeding $3,000 to foreign recipients

Question 6

Under the Dodd-Frank Act, which statement best describes OTC derivative transaction reporting requirements?

Accepted Answer

All OTC derivative transactions must be reported to a swap data repository regardless of size

Answer

Only transactions with notional value exceeding $1 billion require reporting

Answer

Only financial end-users must report OTC derivatives; non-financials are exempt

Answer

Reporting is required only for standardized derivatives, not customized contracts

Question 7

What is the primary role of the Office of Foreign Assets Control (OFAC) in treasury compliance?

Accepted Answer

Enforcing economic and trade sanctions against targeted foreign countries, entities, and individuals

Answer

Administering tax treaties between the U.S. and foreign governments

Answer

Regulating foreign currency exchange rates and international monetary policy

Answer

Overseeing the export of controlled technologies to foreign nations