CRCM Online Practice Questions and Answers

Which of the following does an extension of credit NOT include?

A. An advance by means of an overdraft or cash item

B. The making or renewal of any loan or granting of a line of credit

C. An advance against accrued salary

D. An acquisition of a note on which an insider is a maker, drawer, or guarantor

A bank has been criticized by an examiner for less than satisfactory CRA performance. The bank must show improvement in its commitment to CRA. For the examiner, what would be LEAST effective in demonstrating the change?

A. Informing the examiner that the bank does not plan to acquire or merge with another bank, so CRA is not a priority

B. Giving the examiner an updated CRA public file

C. Showing the examiner a list of community groups with which the bank has met in the past 24 months to discuss credit needs

D. Showing the examiner results of the bank's most recent geocoding analysis, indicating parity in the number of loans made in each census tract

When is it possible for a bank to be exempted from compliance with some of the Government Securities Act custodial regulations?

A. When the bank maintains its securities in the ordinary course of business

B. When the bank has procedures in place to make sure it complies with the custodial regulations of its federal regulatory agency

C. When the bank does not hold itself out as a government securities broker or dealer

D. When the bank uses more than the normal standard of care when maintaining possession and control of securities

First National Bank (FNB) purchased a table for $500 at the Governor's reelection fundraising dinner last fall. FNB President Sally Holmes tells Mary Watkins, the municipal securities principal, that the bank is planning to participate in the upcoming state highway bonD.

What does Ms. Watkins tell President Holmes?

A. The bank cannot participate without prior approval of the MSRB.

B. The bank can participate because national banks are exempt from MSRB rules.

C. The bank can participate, provided it includes the contribution on its next disclosure.

D. The bank cannot participate within two years of a contribution to the issuer.

Under the Interagency Statement on Retail Sales of Nondeposit Investment Products what disclosure must the bank's investment sales representative make to the customer?

A. The bank's regulatory agency

B. The sales commission resulting from the investment purchase

C. That the investment product is not guaranteed by the bank

D. The arbitration procedure for resolving disputes over investment advice

Which of the following is an accurate statement according to the requirements of the customer identification program regulations?

A. A bank must always require documentary verification of a customer's identification

B. A bank may waive any part of the CIP requirements if senior management approves the waiver and there is a good cause

C. A physical address or a post office box is acceptable for any new customer

D. The bank's CIP program must enable it to form a reasonable belief about the identity of the person

To stop a payment of a preauthorized transfer, consumer must notify the institution or in writing at least:

A. Three days before the transfer is to occur

B. Within 14 days of oral notice

C. Binding after 14 days if no written confirmation is received

D. None of these

It means a direction by the consumer that the financial institution not discloses nonpublic personal information about the consumer to a non-affiliated third party, except as permitted by the regulation.

What is it?

A. Opt-out

B. Re-disclosure

C. Non-affiliated

D. Both B and C

Issuing Bank, a foreign bank, maintains an account with First National Bank, a U.S. bank. Issuing Bank issues a letter of credit in favor of ABC, InC. , a U.S. corporation. The letter of credit contains a boycott provision. The letter of credit provides that any negotiating bank may obtain reimbursement from Issuing Bank's account at First National Bank by certifying that the conditions of the letter of credit have been met. Issuing Bank does not send First National Bank a copy of the letter of credit. May First National Bank reimburse negotiating banks for the letter of credit when it contains a boycott provision?

A. Yes. First National Bank did not know of it, so it may reimburse a negotiating bank.

B. No. First National Bank is under a duty to determine the underlying conditions of any letter of credit it pays.

C. No. First National Bank should request a copy of the letter of credit at the time of its payment and then refuse to pay once it is aware of the provision.

D. Yes, provided ABC Company is not a participant in the boycott.

When all the required information is NOT provided by a person purchasing a cashier's check with $8,000 in currency, what should the bank do?

A. Refuse the transaction

B. Complete the transaction and record available information

C. Complete the transaction and file a SAR

D. Complete the transaction and insist that the customer return with the required information