Last Updated on December 28, 2021 by Admin 2

CRCM : Certified Regulatory Compliance Manager : Part 18

  1. In Consumer Leasing Act Content of non-segregated disclosures may be made separately or as part of another document (such as the lease agreement); however, other information cannot be stated, used, or placed so as to mislead or confuse the consumer. Other disclosures include all of the following EXCEPT:

    • A statement of the conditions under which the lessee or lessor may terminate the lease before the end of the lease term, along with the amount (or a description of the method of how the amount is determined) of any penalty or other charge for early termination
    • Whether the lessee has the option to purchase the leased property during the lease term and, if applicable, the purchase price (or method for determining it) and when the lessee may exercise it
    • The lessee’s right to an independent appraisal of the property if the lessee’s liability at the end of the lease is based on the realized value of the leased property, and that the appraisal will be binding on all parties
    • A statement of maintenance responsibilities including the counter bank responsible and a description of the responsibility
  2. Under Renegotiations, extensions, and assumptions-12 CFR 213.5; any lease that is renegotiated or extended by longer than six months is considered to be a new lease, subject to new disclosure requirements, except when:

    • One or more payments are deferred, whether or not there is a charge for the deferral
    • Lease property is substituted with property of substantially equivalent or greater value, if no other lease terms are changed
    • In a multiple-item lease, property is added, deleted, or substituted provided the average periodic payment does not change by more than 35 percent
    • There is an agreement resulting from a pre-order
  3. In a motor vehicle lease, a mathematical progression showing how the periodic payment is derived, containing the following information:

    • Gross capitalized cost (including the agreed-on value of the vehicle)
    • Rent charge (the difference between the total of base payment over the lease term minus the depreciation and any amortized amounts)
    • Itemization of other charges that are part of the periodic payment
    • All of the above
  4. Supervisory review should also be the part of Subprime Mortgage Lending. It should review:

    • Regulatory agencies will continue to focus on risk management review and consumer compliance processes
    • Hiring and Training of personnel
    • Agencies will continue to take action against institutions that violate consumer protection laws or fair lending laws or that engages in unfair or deceptive acts or practices or in unsafe or unsound lending practices
    • Applicability of prepayment penalties
  5. The act limited balloon payments in consumer leases and enabled consumers to compare lease terms with credit terms where appropriate. The act was implemented by Regulation M (Consumer Leasing). It requires disclosures to consumers before consummation of the lease agreement. This act is:

    • Consumer leasing act
    • Risk disclosure act
    • ALLL
    • None of these
  6. Content of segregated disclosures in Consumer Leasing Act include all of the following

    EXCEPT:

    • Amount due at lease signing or delivery, itemized by type and amount, including:
      Refundable security deposit
      Advance monthly or other periodic payment
      Capitalized cost reduction
      An itemization of how the amount due will be paid, by type and amount (only required in a motor vehicle lease), using the model form
    • Number, amount, and due date of payments scheduled and the total amount of periodic payments
    • In an open-end lease, the descriptive statement “You will owe an additional amount if the actual value of the vehicle is less than the residual value”
    • If there are multiple items of property, the property description may be separate
  7. Which of the following is NOT included in the definition of margin stock?

    • Stock traded on a national securities exchange
    • Nonmargin stock convertible to margin stock
    • Debt securities convertible to margin stock
    • Warrants to purchase margin stock
  8. __________________ is a transfer that is authorized in advance to occur at substantially regular intervals. Payments that require the consumer to take specific actions to initiate them (such as by entering instructions on a touch-tone telephone or on the Internet) are not such type of EFTs.

    • A preauthorized EFT
    • A postauthorized EFT
    • A standard format EFT
    • A customized EFT
  9. Initial disclosure under Electronic funds transfer act includes:

    • A summary of the consumer’s liability for unauthorized transfers
    • Telephone number and address of person or office to be notified in case of any authorized transfer
    • The type of EFT the consumer may make and any limitations on EFTs
    • A summary of institution’s liability to consumer for failure to make or stop transactions
  10. Electronic funds transfers’ requirements say that transfers that vary in amount must be communicated to the designated payee within _______________ before the scheduled transfer or may give the consumer the option of receiving notice only when a transfer falls outside a specified range of amounts.

    • 10 days
    • 20 days
    • 30 days
    • 15 days
  11. EFT provides consumers with limitations on liability for unauthorized electronic fund transfers. It includes the following types of funds transfers EXCEPT:

    • Point-of-sale transfers
    • Automated teller machine (ATM) transfers
    • Transfers initiated by Fax
    • Withdrawals of funds, including merchant transactions where no electronic terminal is involved, if the customer’s account is debited
  12. Payment to a beneficiary is made at the earlier of the time when:

    • The payment order is credited to the beneficiary’s account or when notice of the credit is sent to the beneficiary
    • The amount is credited to the receiving bank’s account at the Reserve Bank or when the payment order is sent to the receiving bank
    • The amount is debited to the receiving bank’s account at the Reserve Bank or when the payment order is sent to the receiving bank
    • The payment order is debited to the beneficiary’s account or when notice of the credit is sent to the beneficiary
  13. Which of the following primary purpose/s were behind the Electronic Fund Transfer Act (EFTA)?

    • To provide disclosures to consumers who use electronic fund transfer (EFT) systems
    • To provide consumers with limitations on liability for unauthorized electronic fund transfers
    • Both A and B
    • None of these
  14. Implemented by _______________, EFTA is intended to provide certain rights to individual consumers using EFT payment systems. It also places responsibilities on financial institutions whose accounts are affected by EFTs.

    • Regulation E (Electronic Fund Transfers)
    • Regulation F (Electronic Fund Transfers)
    • Regulation T (Electronic Fund Transfers)
    • Regulation A (Electronic Fund Transfers)
  15. An error in EFT includes any of the following:

    • An unauthorized EFT
    • The omission from a periodic statement of an EFT that should have been included
    • A consumer’s request for documentation required to be given on receipts or statements or for clarification of information (does not include routine inquiries about account balances)
    • All of these
  16. There is no error in an error in EFT when there is situation as:

    • The reversal of a direct deposit made in error is not considered an unauthorized EFT if the deposit was made to the wrong customer’s account, a duplicate was made to the customer’s account, or a credit was made in the wrong amount
    • A request for duplicate copies of statements
    • The failure to receive a receipt from an electronic terminal when the transaction amount is $25 or more
    • A returning request for information for tax or recordkeeping purposes
  17. Following mentioned are the responsibilities of:

    1. Must notify the bank, either orally or in writing, of error within 60 days:

    • Of the institution’s transmission of a statement or other documentation on which the error first appears or

    • Of receiving additional information or clarification provided pursuant to the consumer’s request

    2. Consumer’s notification should include the following items

    • Consumer’s name and account number or information that allows the institution to identify the consumer’s name or account number

    • Consumer’s belief and reasons for the belief that an error exists and, if possible, the type, date, and amount of the error (this information does not have to be given if the consumer is simply requesting further information or clarification)

    • Consumer
    • Financial institution
    • Reserve Bank
    • A third party
  18. Which of the following is/are NOT limitations on liability in EFT?

    • $150 liability limit if consumer notifies the institution within two business days of discovery of loss or theft of access device, not including the day the consumer learns of the loss or theft
    • If state law has more generous limitations of liability for the consumer, the state laws will govern
    • Full liability (up to the amount of the unauthorized transfer) may be imposed if the consumer does not notify the institution within 30 days of the institution’s transmission of the statement on which the first unauthorized transfer appears (to raise the liability limit, the institution must first establish that the unauthorized transfers would not have occurred if the consumer had notified the institution within the 30 days). The unlimited liability applies only to the transactions that occur after the 30-day time period
    • Extenuating circumstances (such as hospital confinements, travel, and so forth) may extend the liability time periods
  19. It is not required for accounts where the only EFT allowed is a preauthorized transfer to an account. If the account is a passbook account, the bank updates the passbook on presentation; if not, the bank it at least quarterly.

    • A periodic statement
    • Change in terms notice
    • Unauthorized transfers
    • Error resolution notice
  20. Under Unauthorized transfers-12 CFR 205.6 prerequisites for consumer liability are all of the following EXCEPT:

    • If an access device was used, it must have been an accepted access device
    • Institution must have provided a means of identifying the consumer to whom the device was issued (for example, by electronic means (PIN), photograph, or fingerprint)
    • Increased liability for the consumer
    • Institution must have provided the following in writing to the consumer
      • A summary of consumer’s liability for unauthorized transfers
      • Telephone number and address of person or office to be notified
      • in case of unauthorized transfer
      • Institution’s business days