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OBA Compliance Training Test Review
Terms in this set (51)
What are some ways to prevent UDAP problems?
Internal control, following procedure, risk assessment
What is the implementing regulation for UDAAP or is there one?
What piece of legislation resulted in UDAP
Is it recommended you have a complaint policy, and what do you do with it?
Yes but not required. Establish a formalized and centralized system of response to handle complaints and inquiries which may have compliance consequences
Is there a definition for complaint?
Dictionary.com- an expression of grievance
US Gov.- formal statement filed as a hard copy or electronically of dissatisfaction with a service or product that was provided by a financial institution.
Internal- must internally define what a complaint is for your institution.
Who might want to know about various vendors you use in the bank
Why does the bank do risk assessment on their vendors
Because the bank is ultimately responsible
What do you do after risk assessment on vendors
Decide if you want to take on that risk, and if you do make sure you implement internal controls
Examples of social media
Facebook, twitter, YouTube, FarmVille
Components of social media risk management programs
-policies and procedures regarding the use and monitoring of social media
-employee training program
-oversight process for monitoring information posted to social media sites
-audit and compliance functions to ensure ongoing compliance
My bank can use social media to collect debt by posting public ally on a customers social media site that they owe a debt
Financial institutions that offer mobile banking applications should provide security awareness training to end users to help them recognize legitimate applications and provide a list of reputable sites to download institution-approved applications
When should compliance get involved in developing a new product?
Prior to implementation, from beginning
Who should see the results of your audits?
Board of directors or to relevant board committee
What is a procedure
Operational process required to implement policy
What is the first step in creating risk assessment
Understanding your institution!
What do we mean my raw risk
Inherent risk- risk before controls; considers the likelihood and impact of noncompliance with consumer laws and regulations prior to considering and mitigating effects of risk mgmt processes
What are some things to consider when you are developing and maintaining a compliance training program?
-timeframe of new employee training
-mandatory training required by regulation
-training matrix and monitoring
Where do you find banking laws
Does official staff have the same impact on enforcement as regulation
According to Reg CC whatbitems need to be available the next day?
-us treasury check
-USPS money order
-cashiers checks, certified checks, tellers check
- check drawn on state or local gov in same state
What set of rules and procedures enforce the EFAA (expedited fund availability act)
What does Reg DD implement
Truth in savings act
Can you pay interest on a DDA
How would you describe advertising in general terms
A commercial message in any medium that promotes directly and indirectly a credit transaction
If a news article is written and your banks name is on it is it considered advertising?
Does Reg E apply to business accounts
What are some examples or situations when a person can receive money back from a transaction?
Customer must notify you of an error in a manner that you specify. If they do not notify you within that time period, they are liable.
In general what does Reg O cover
The intent to limit the insiders from taking advantage of their positions of authority, high ranking, or influence for their personal gain that would be a detrimental risk to the financial institution
What are some changes Dodd-Frank made to Reg O?
How do you handle and inadvertent overdraft for an executive officer or director?
No preferential treatment/ fees apply
What type of transactions would be covered by know before you owe disclosure rule?
-real estate secured
Where do you find requirements regarding consumers
What are some transactions that are subject to the right of recision?
If security interest is taken in a consumers principal dwelling each consumer with ownership interest will have the right to cancel the transactions unless
-residential mortgage transaction
- business purpose
-refinance with no additional funds
What are some of the required elements of an application according to know before you owe rule
What types of transactions are covered by Reg Z
Individuals or businesses that offer or extend credit. - credit is offered or extended to customers
-the offering or extension of credit is done regularly
-the credit is subject to finance charge or payable by a written agreement in more than four installments and
- the credit is primarily for personal, family, or household purposes
When does the new beneficial ownership rule go into effect
May 11, 2018
Timeframe to collect information regarding beneficial ownership?
At account opening
Five pillars of BSA compliance
1. System of internal controls to ensure ongoing compliance
2. Independent testing for BSA Compliance
3. BSA officer to coordinate and monitor daily compliance
4. Training for appropriate personnel
5. Establishment of risk based customer due diligence procedures
When does clock start on time to file an SAR
At detection of suspicious activity
What type of loans does Reg B apply to?
All creditworthy applicant loan
What do we mean by Disparate Impact
Evidence of policies or practices that are nondiscriminatory on their face, but which nonetheless produce a disproportionate advers impact on persons who are protected under the federal fair lending laws
What type of loans are covered under RESPA
Federally related mortgage loans
Under RESPA Sec 8 what is a kickback?
Payment of something of value to a recipient as compensation or reward for providing favorable treatment to another party
How much flood insurance can a borrower purchase?
Non 1-4 family residence $500,000
1-4 family residence $250,000
What types of loans would be covered under the flood protection act
-buildings under construction
- mobile homes on permanent foundations
-condominiums or townhouses
-other types of residential, industrial, commercial and ag buildings
How do the fair hosing act and Reg B differ
The fair housing act does not prohibit against discrimination based on age or marital status, but Reg B does
(handicap and familial status)
What types of loans are covered by the MLA
Consumer credit offered or extended to a covered borrower primarily for personal, family or household purposes and is subject to a finance charge OR payable by a written agreement in more than 4 installments
What are some of the basic protections provided by the service members civil release act
- 6% cap on debts incurred prior to military service
- limits on ability to foreclose
- limits on ability to evict from rental property occupied as principal residence
- limits on ability to terminate installment contracts or repossesses personal property
- prohibitions on derogatory reports to credit agencies die to assertion of rights under SRCA
When a bank can obtain a credit report
- in accordance with written. Instructions of the consumer to whom it relates
- when information in a consumer report is intended to be in connection with
-----an extension of credit to the consumer or the review and/ or collection of an account of the consumer
-----the underwriting of insurance involving consumer
-----the valuation of or assessment of risks associated with and existing credit obligation as a potential investor or serviced or current insurer
- there is legitimate business need for the information
-----in connection with a business transaction that is initiated by the consumer
----to review an account to determine whether the consumer continues to meet the terms of the account
What are some examples of community development service
-primary purpose os community development
- provide technical assistance on financial matters regarding housing and/or economic revitalization
- lends employees to provide financial services for organizations facilitating affordable housing construction or rehabilitation
- develops and teaches financial education for low to moderate income individuals
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