CBA Ethics & Compliance — Questions and Answers
Question 1: Why is ethical conduct essential in bankruptcy administration?
- To win more cases
- To secure media coverage
- To ensure fairness and legal integrity (Correct answer)
- To avoid paperwork
Correct answer: To ensure fairness and legal integrity
Ethical conduct ensures fairness, protects stakeholders, and maintains the integrity of the legal process.
Question 2: What is a common ethical breach in bankruptcy proceedings?
- Filing paperwork early
- Requesting an extension
- Hiding assets from the court (Correct answer)
- Correcting name spellings
Correct answer: Hiding assets from the court
Failing to disclose assets is a serious ethical and legal violation that undermines the bankruptcy process.
Question 3: Which law governs professional conduct in U.S. bankruptcy cases?
- Tax Reform Act
- Federal Civil Rights Law
- Bankruptcy Code and Rules (Correct answer)
- Immigration and Nationality Act
Correct answer: Bankruptcy Code and Rules
The U.S. Bankruptcy Code and Federal Rules of Bankruptcy Procedure guide ethical and compliant behavior in bankruptcy cases.
Question 4: What is the role of compliance in bankruptcy proceedings?
- To increase debtor penalties
- To limit paperwork
- To meet legal obligations and reduce risk (Correct answer)
- To avoid taxation
Correct answer: To meet legal obligations and reduce risk
Compliance ensures that all legal and procedural obligations are met, reducing risks of sanctions and reversals.
Question 5: How can professionals avoid conflicts of interest in bankruptcy cases?
- Ignore prior relationships
- Adjust billing rates
- Disclose conflicts and recuse if needed (Correct answer)
- Change job titles
Correct answer: Disclose conflicts and recuse if needed
Disclosing potential conflicts and withdrawing when appropriate helps maintain trust and ethical standards.
Question 6: Why is transparency critical in bankruptcy compliance?
- To simplify records
- To reduce fees
- To build trust and ensure legal clarity (Correct answer)
- To speed up bankruptcy filings
Correct answer: To build trust and ensure legal clarity
Transparency ensures accurate reporting, fosters trust among parties, and prevents legal violations.
CBA Ethics & Compliance
Why is ethical conduct essential in bankruptcy administration?