Questions 1-5 Flashcards
When a creditor makes a significant change in terms of a credit card account, the creditor must:
a. Provide affected consumers with a notice that includes a statement that the consumer may reject the change and continue to use the account for a period of 6 months under the existing terms
b. Provide affected consumers with a notice that includes a statement that the consumer may reject the change but the consumer’s ability to use the account for further advances will be terminated or suspended
c. Provide affected consumers with a notice that includes a demand for payment in full of the account balance with at least a 60 day grace period
d. Provide consumers with a statement of reasons for the change
B
In which of the following transactions is a disclosure statement to the consumer required?
A. A $125,000 loan to purchase and secured by an unimproved lot on which the borrower eventually plans to build a home for retirement
B. A $100,000 loan made to a physician for a recreational vehicle, secured by the physician’s business equipment
C. A $75,000 loan to purchase a speedboat
D. A $200,000 unsecured loan to purchase a residence
A
Which of the following is a loan originator?
A. The office manager of a manufactured home retail center who does not accept applications from customers?
B. A bank teller who distributes preprinted home loan rate sheets to customers who inquire
C. A customer service representative who assists applicants that complete an application and collect application data, but does not have loan authority
D. A real estate broker who refers prospective purchasers to a mortgage company
C
For purposes of calculating an APR, an “irregular transaction” includes:
a. Multiple advance construction loans
b. A single payment loan
c. A loan with a final balloon payment
d. A loan with quarterly payments
A
First National Bank received a credit application from Lewis Nelson for a home equity loan. Mr. Nelson indicated that he has a $75,000 loan from the Overton Cancer Center. The bank called the cancer center to check the credit history and balance on the loan. The bank discovered that Mr. Nelson is four months past due on the loan. Based on this information, the bank denied the home equity credit application to Mr. Nelson. Which statement is correct?
A. The bank’s denial, based on the information, was wrong because the fact that he had a loan from the cancer center involves medical information about the consumer.
B. The bank should not have contacted the cancer center at all because doing so involves medical information about the consumer.
C. The bank should have had disclosed on its consumer application that medically related debts do not have to be listed.
D. The bank acted correctly because it treated the applicant’s medical debt just as it would any other debt.
D
In which of the following cases would ABC Bank have to obtain an appraisal performed by a state-certified appraiser?
A. On a $200,000 loan made by Mr. and Mrs. Littlefield to purchase their home, which will be secured by their home
B. On a $75,000 loan to be secured by a two-story commercial office building
C. On a $150,000 working capital loan fully secured by a bank certificate of deposit, on which the loan officer has also taken a lien on a vacant lot owned by the borrower
D. On a $300,000 loan to Mr. Burch secured by his life estate in his home. The home was left to Mr. Burch on the death of his father. The father’s will states that the home will belong to Mr. Burch during his life but will revert to Mr. Burch’s son on his death.
D
On Monday, ABC Bank received a written application from the Browns for a loan to purchase their home. Later that day ABC mailed the Browns their early TILA disclosures. On what day may ABC debit the Browns account for an application fee?
A. Tuesday
B. Wednesday
C. Thursday
D. Friday
D
Which of the following practices is not allowed under the Credit Card Practices Rules?
A. Charging a late fee when a payment is late
B. Requiring a security deposit for a credit card account
C. Calculating the balance based on days in a previous billing cycle because the grace period was lost
D. Charging a variable rate APR based on a public index that changes from time to time
C
Mr. Edwards has a First National Bank debit card. The card allows him to withdraw funds from his checking account to pay for goods or services by using major credit card networks. Providers of services that accept MasterCard or VISA will accept Mr. Edwards debit card. Mr. Edwards travels often. In March, while at home, he reviews his checking account statement and notices three ATM transactions whereby funds were debited from his account using the debit card. The transactions were made in San Diego during February. Mr. Edwards never went to San Diego. None of his family members have debit cards. He called the bank and asked to be reimbursed for the $750 that was taken from his account but not authorized by him. What may the bank do?
A. Point out to him the language in his account agreement where he agrees to be liable for all withdrawals, whether or not authorized, and tell him that they will not credit his account for the funds
B. Tell him that they will investigate and the funds should be credited within 20 business days
C. Provisionally credit the account within 10 business days and take up to 45 days to investigate the unauthorized debit
D. Provisionally credit the account within 20 business days
C
Which of the following actions is allowed under the Fair Debt Collection Practices Act?
A. Sending a communication that looks like a telegram to a consumer by regular mail
B. Sending a postcard to a consumer asking for payment of the past due balance
C. Accepting certain postdated checks
D. Requiring consumers to pay collection fees not authorized by the contract when they pay the balance of their accounts
C
The manager of teller operations contacts the compliance manager about a high level of exceptions noted on hold notices during recent compliance monitoring. Which of the following recommendations is MOST appropriate for the compliance manager to make?
A. Require an officer’s review and signature on all hold notices.
B. Support the purchase of a new teller computer system to automate hold notices.
C. Increase the frequency and volume of compliance monitoring to better determine the weak areas.
D. Arrange remedial training on hold notice requirements for tellers where the exceptions were noted.
D
Your institution is open for all business functions on Saturday. Customer Jones deposits a $4,000 IRS refund check payable to him with a teller on Saturday at the driveup window. When must the funds be made available for withdrawal?
a. Monday
b. Tuesday
c. Wednesday
d. Same day
B
Which of the following features is acceptable in a high-cost mortgage loan?
A. A late fee constituting five percent of the amount past due
B. A payment schedule that allows for negative amortizations
C. A prepayment payment penalty provision effective for the first year of the loan
D. An unconditional demand clause
C
Which of the following transactions is subject to the provisions of Regulation O?
A. Time deposit account held by a director
B. Travel advance to an executive officer outstanding for less than 30 days
C. Extension of credit to a director of an unaffiliated, competing, noncorrespondent bank
D. Extension of credit to a member of the bank’s board of directors
D
To avoid being considered a consumer reporting agency, the FCRA requires banks that regularly purchase dealer paper from automobile dealers to be sure that the:
A. Dealer properly discloses the reasons for a denial of credit.
B. Bank’s name does not appear on the application or on the contract signed by the customer.
C. Dealer reports to the consumer the name and address of the bank.
D. Statement of disclaimer of liability is on any application for credit purchased by the bank.
C
On which of the following adjustable-rate loans must the bank use an index beyond its control?
A. A loan to purchase a home to refurbish and resell for a profit
B. A loan to purchase a vacation home
C. A loan to purchase a duplex where the borrower will live in one of the units
D. A loan to purchase a home to be used as rental property
C
The OCC recommends all but one of the following actions to help prevent a national banks purchasing or acquiring predatory or abusive loans. Which practice is NOT recommended?
A. Establish policies on the bank’s relationship with third-party brokers and originators
B. Review loan documentation
C. Audit the third-party broker
D. Require the broker to establish a reserve account for legal contingencies
D
Acme Mortgage Company owns and services a mortgage loan for John Smith. The company received a statement from Mr. Smiths insurance company indicating that the premium on the hazard insurance has not been paid and that it will be cancelled soon if not paid. Mr. Smiths escrow account has insufficient funds to make the insurance payment. Under what circumstances may Acme Mortgage Company force place hazard insurance on Mr. Smiths property and charge him for the premium?
A. Once they notify Mr. Smith and give him an opportunity to make the payment, Acme can force place a policy
B. Acme may not force place a policy in this case, it must advance funds to the escrow account to make the payment so the insurance will continue
C. Acme does not have to give advance notice; once the policy is finally cancelled, they can force place a policy
D. Acme can force place a policy as long as it is not more expensive than the original premium
B
An individual borrowed $1,000 to remodel her mobile home. She lives in the mobile home that is not anchored to the ground. The loan will be secured by the mobile home, but the borrower does not own the lot on which it is parked. For HMDA purposes, this loan is considered to be which of the following types of loans?
A. Consumer RV
B. Home equity
C. Home improvement
D. Second mortgage
C
Roberta Miltons car lease with First National Bank reached its termination on August 1. Roberta and the bank agreed to extend the lease on a month-to-month basis without charging her a fee for doing so. What disclosure responsibilities does the bank have now?
A. None are needed now.
B. None, until after six months of the month-to-month lease
C. The bank must make an entirely new initial disclosure
D. The bank must disclose the estimated residual value at the end of six months
B
Which of the following is a contract provision permitted under Regulation AA?
A. Confession of judgment clause
B. Waiver of exemption clause
C. Assignment of wages
D. Purchase-money security interest in household goods
D
Legislation was recently enacted to reform consumer real estate protection laws, and the bank will now have to change the way it documents, discloses, and advertises real estate loans, an integral product line at your bank. What should the compliance professional do FIRST to implement the new law within the bank?
A. Read the law and write a new real estate compliance policy
B. Form a task force of the business unit managers whose departments will be affected by the law to collectively form an action plan
C. Talk to the bank president about the need for more resources in compliance
D. Sign up all bank personnel affected by the changes for a seminar on the new law
B
How must a card issuer disclose a minimum payment on a periodic statement for an open-end credit account that is not home-secured?
A. By disclosing the actual repayment for the consumer’s account balance, rate, and terms over the remaining term of the account
B. By providing a toll-free telephone number that will respond with a generic payment example
C. By disclosing the estimated monthly payment for repaying in 36 months
D. By disclosing several generic examples that could apply to the consumer’s account
C
Friendly Savings Association has made loans to ABC Co., Inc., and several of its subsidiaries. The association does not believe that the loans have to be combined under the common enterprise test. To what lending limit, if any, does the association have to adhere in its lending to ABC Co., Inc., and its subsidiaries?
A. None. If the loans can be combined, there is no limit on the group as a whole, only separately
B. 15 percent of the association’s capital and unimpaired surplus
C. 10 percent of the association’s capital and unimpaired surplus
D. 50 percent of the association’s unimpaired capital and unimpaired surplus
D
The Mortgage Department asks the Compliance Officer to evaluate its current practices surrounding collecting application fees from mortgage loan applicants in light of the new TRID rules that became effective October 3, 2015. Which of the following options presented by the Mortgage Department to the Compliance Officer complies with Regulation Z?
a. Collection application fees from applicants (cash or check) at time application is submitted and hold for deposit until after bank receives intent to proceed from applicant
b. Send a Request for Application Fee Form to applicant with Loan Estimate and other disclosures with instruction to submit after customer provides an intent to proceed with the application
c. Have applicant sign a form that provides the method of payment (credit card number or bank account number) for the application fee at the time the application is completed and with to process the payment until after the intent to proceed is received
d. Have applicant sign an authorization form at time of application that authorizes the bank to deduct the application fee from the customer’s checking account or savings account
B
Cassandra Phillips requested a loan to purchase a boat. She asked for $15,000 at 7.5 percent for seven years. The bank considered her request but decided, considering her income and credit history, the best offer of credit the bank could make was $10,000 at 8.25 percent for five years. Rhonda Mays, the loan officer, wrote a letter, setting forth the terms the bank could offer. The letter was mailed on July 1. Ms. Phillips received the letter and began to look elsewhere for a loan on the terms and conditions she wanted. Does the bank have any additional responsibility to Ms. Phillips?
A. No. Because the bank made the offer of a loan, there is no further responsibility.
B. No. Because the customer decided to look elsewhere, there is no further responsibility.
C. Yes. The bank must follow up with a phone call to determine if Ms. Phillips is still interested.
D. Yes. The bank must send an adverse action notice because Ms. Phillips did not take the bank’s counteroffer.
D
Which of the following is an exception from the lending limit regulations for national banks and savings associations?
A. A standby letter of credit
B. A commercial letter of credit
C. A loan made to a foreign government
D. A loan made to a dairy farmer
B
First National Bank has an overdraft privilege program available to its deposit customers. Under this program the bank generally pays checks, ACH items and recurring debit card transactions presented against accounts up to a pre-set limit. The bank does not pay overdrafts originated as ATM transactions or as one-time debit card transactions. From time to time, however, point of sale transactions initiated by debit cards are presented as preapproved items and, according to the rules of the card association, the bank must pay the transaction as presented. Therefore the bank does have a few overdrafts originated as one-time debit card transactions. Which of the following is a true statement for the bank?
A. The bank must provide an opt in notice to all its customers
B. The bank does not have to provide an opt in notice, but it cannot charge an overdraft fee on the inadvertent overdrafts created by ATM and debit card transactions
C. The bank does not have to provide an opt in notice to its customers and it may still charge for inadvertent overdrafts created by ATM and one-time debit card transactions
D. If the bank pays overdrafts originated by check, it must also pay those originated by ATM and one-time debit transactions
B
When helping a loan officer determine whether the bank must give a written adverse action notice to a business loan applicant, what should the compliance officer consider?
A. Current net income
B. Gross revenue for the preceding fiscal year
C. Length of time the applicant has been in business
D. Type of business entity (that is, corporation, partnership, or sole proprietorship)
B
Borrower A has a variable rate loan secured by his principal dwelling for a term of 10 years. Which of the following is NOT a Truth in Lending requirement for his loan?
A. Providing a variable rate disclosure of certain terms of the loan program at the earlier of the application time or before a nonrefundable fee is paid
B. Limiting the number of interest rate increases in each calendar year
C. Including an interest rate cap in the loan contract
D. Providing a consumer handbook on adjustable-rate mortgages to the borrower
B
One of the differences between the Fair Housing Act and the Equal Credit Opportunity Act is:
a. The FHA prohibits illegal discrimination in housing-related credit and ECOA doesn’t
b. The ECOA affects advertising practices and FHA doesn’t
c. The FHA prohibits discrimination on the basis of familial status and ECOA doesn’t
d. The ECOA applies to potential credit applicants and the FHA only applies to borrowers
C
A bank has been criticized by its regulators for weaknesses in its compliance training program. Bank management has asked the compliance officer to fix the problem. What should the compliance officer do FIRST?
a. Hire additional staff to conduct compliance training for all affected areas of the bank
b. Identify what the weaknesses in the training program are
c. Purchase software to track training attendance
d. Schedule training as soon as possible on a hot topic such as fair lending or Bank Secrecy Act
B
Which of the following is NOT a required disclosure for an income tax refund anticipation loan to a servicemember?
A. The military annual percentage rate (MAPR)
B. The annual percentage rate (APR)
C. A description of each of the events of default
D. A list of all the fees included in the MAPR
C
Regulation E disclosures must FIRST be provided to an EFT customer either at the time the account is opened or at what other time?
A. With the first periodic statement
B. Before the first EFT occurs
C. Within three business days of opening the account
D. Within three business days of receiving the customer’s request for EFT services
B
First Nationals funds availability policy states that funds from checks are generally available for withdrawal on the next business day following the day of deposit. The policy also states that longer holds may be required on a case-by-case basis and advises customers to ask if they need to be sure of the availability of a specific deposit. Henry Cranston deposited a check into his account on Monday. Henry needed to use the funds on Tuesday but he did not ask about the availability at the time of the deposit. A bank teller accepted the deposit and gave Henry a receipt. After Henry left the bank, the tellers supervisor noticed the check and decided that a longer hold needed to be placed and the funds would not be available until Wednesday . Which of the following actions must the bank perform?
A. The bank must make the funds available on Tuesday, because Henry was not notified at the time of the deposit.
B. The bank may hold the funds for a longer time period but must send Henry a hold notice.
C. The bank may hold the funds for a longer time period and need not notify Henry because he did not ask about the availability of the deposit.
D. The bank may hold the funds for a longer time period and may, at its option, send Henry a notice of the delay.
B
ACME Bank would like to offer a 2.9 percent APR promotional rate for its new credit card. The rate is effective for the first six months of the account, unless the borrower makes a late payment or otherwise defaults on the credit card account. At the end of six months, or if an earlier event triggers a rate increase, the rate will increase to 15 percent APR. In order to be in compliance with the Credit Card Practices guidance, which of the following account terms does NOT need to be included in promotional materials?
A. All material limitations on the applicability of the promotional rate
B. The time period the rate is in effect
C. Possible reasons for shortening the promotional rate period
D. A typical payment that would be due at the promotional rate
D
When a bank makes a rescindable closed-end home improvement loan to a consumer, to which of the following may the bank advance funds before the end of the rescission period?
A. To the borrower
B. To the contractor for delivery of materials
C. To an escrow account with a third-party escrow agent
D. To an escrow account with the borrower acting as the escrow agent
C
Which of the following actions is prohibited under EFTA/Regulation E?
a. Imposing a fee for EFTs
b. Requiring a consumer to authorize payments to a credit account as a condition of an extension of credit
c. Requiring a consumer to provide a written confirmation of an oral stop payment order
d. Requiring a consumer to request an access device in writing
B
Friendly Service Bank is a new bank that will focus on offering financial services to consumers. The compliance officer needs to comply with the identity theft prevention requirements of the FACT Act. What should she do first?
A. Write a compliant policy that the board can approve
B. Establish procedures for handling address changes
C. Appoint a task force to establish compliance priorities
D. Perform a risk assessment of the bank’s risk factors for identity theft
D
First National Bank has made three loans to Mrs. Elmwood. Two of the loans are regulated credits (they are for the purpose of purchasing margin stock and secured by margin stock). The third loan is for the purpose of purchasing margin and nonmargin stock, and the loan is secured by real estate and margin stock. Can the bank avoid having the third loan combined with the other two for Regulation U purposes?
A. Yes, but the real estate must have a value of at least twice as much as the third loan.
B. No. At least the part of the loan attributable to the security of margin stock must be treated as a regulated credit and combined with the other two loans.
C. No. All of the third loan must be combined with the others.
D. Yes. As long as there is any other collateral, the loan will not be a regulated credit.
B
What is the longest time after board approval that a bank can approve a line of credit for an executive officer?
A. 12 months of such approval
B. 9 months of such approval
C. 14 months of such approval
D. 6 months of such approval
C
“Your Home Loan Toolkit” is one of the disclosures that needs to be provided to consumer home loan applicants…
a. Not later than 3 business days after a covered application is received
b. With an application form to be completed by an applicant for a covered application
c. At least 3 business days prior to loan consummation for a covered loan
d. At least 3 business days after a covered loan application is received
A
Robin Myers defaulted on her car loan at the bank. The bank sent several reminder letters and, finally, a demand for payment. The last letter said that if she did not pay, the bank would repossess the car. Before its repossession Robin joined the Marines. She sent the bank a notice that she was now in active military duty and asked the bank to forebear taking any further action against the collateral. What can the bank do?
A. Proceed with self-help repossession of the vehicle since she had already been notified of the default before joining the service
B. File a petition with a court of competent jurisdiction and ask for permission to repossess the car
C. Ask Robin’s commanding officer for permission to repossess the car
D. Repossess the car but don’t sell it until Robin’s military service is over
B
If provisional credit is made to a customer for an alleged error on an ATM cash withdrawal, Regulation E requires a bank to determine whether an error has occurred and to notify the customer NO LATER THAN how many days after the bank receives notice of the alleged error?
A. 10 business days
B. 10 calendar days
C. 45 business days
D. 45 calendar days
D
If a bank originates certain high cost closed-end mortgage loans, it must be sure to avoid which of the following loan terms for such loans?
a. Due on sale clauses
b. Late charges
c. Adjustable rate
d. Negative amortization
D
Under Regulation E, when a bank imposes a change that increases fees or charges related to electronic fund transfers, or restricts availability of electronic transfers, it must provide notice to its customers. How many days in advance of the change must the bank notify customers?
A. 10
B. 15
C. 21
D. 30
C
First National Bank is preparing for a regulatory examination that will include a HELOC portfolio acquired through a merger last year. The Risk Management team is reviewing internal controls, policies, and procedures to ensure the process for handling HELOC transactions meets expectations outlined in the Interagency Guidance on Home Equity Lines of Credit Nearing Their End of Draw Period. Which of the following should not be evidenced in the banks current HELOC risk management practices?
A. Detailed monthly reporting on end-of-draw exposures is provided for inclusion in ALLL estimates.
B. When working with a high-risk borrower, the bank evaluates their ability to repay the loan.
C. Borrowers are directed to contact the Bank’s customer service team two weeks before their end-of-draw date to discuss alternative repayment options.
D. The consumer lending quality assurance team performs quarterly reviews on a sample of HELOC transactions nearing their end-of draw period.
C
In which of the following cases is a notice required to be sent to the accountholder upon receiving a garnishment order related to his account?
A. The account had a $500 Federal benefit payment deposited 3 weeks earlier and the account balance is now $700
B. The account has never had a Federal benefits deposited into it and the current balance is $400
C. The account had a $500 Federal benefit payment deposited 3 weeks earlier and the account balance is now -$27
D. The account last had a Federal benefit deposited into it six months prior to the order and the current balance is $250
A
To which homeowners must a bank give homeownership counseling disclosure and a Servicemembers Civil Relief Act Notice?
A. All borrowers at time of application
B. Only borrowers who are servicemembers
C. All borrowers who are more than 45 days delinquent on their mortgage loan secured by a principal dwelling
D. All borrowers who are no more than 45 days delinquent on their mortgage loan secured by a principal dwelling
D
Which of the following is true regarding extensions of credit to executive officers, directors, and principal shareholders?
A. Must be approved in advance by the board of directors if the aggregate credit is more than the greater of either $25,000 or 5 percent of the bank’s capital and surplus, not exceeding $500,000
B. Must be approved in advance by the board of directors if the credit is greater than $50,000 or 5 percent of the bank’s capital and surplus
C. May not exceed $100,000 in the aggregate, regardless of approvals
D. May not exceed $250,000 in the aggregate, regardless of approvals
A
When must a cosigner notice be given to the consumer for an open-end credit account?
A. Before the consumer becomes obligated on the account
B. At the time of the application
C. With the first periodic statement
D. Within 30 days of the date of the first transaction on the account
A
For which of the following deposits is a bank NOT required to give next day availability?
A. A deposit of seven $100 bills
B. A deposit of a Social Security check by mail
C. A deposit of a Social Security payment
D. The deposit of a cashier’s check at an ATM
D
What must a married couple do to waive their right of rescission on their residential property?
A. Call the bank’s toll-free telephone number
B. Obtain the loan officer’s written approval
C. Sign the bank’s standard waiver form
D. Sign a written statement indicating the reason for the waiver
D
Which of the following closed-end loans is subject to the right of rescission?
A. A loan to purchase a vacation home, secured by the vacation home itself
B. A loan to purchase a principal residence, secured by the residence
C. A loan to purchase furniture for use in a principal dwelling, secured by the furniture
D. A home improvement loan for the borrower’s principal dwelling, secured by the dwelling
D
Which of the following practices could a national bank implement and remain in compliance with the Credit Card Practices guidance?
A. Promote a credit card with a limit ‘‘up to $5,000’’ but send the promotional materials to consumers with lower credit scores who would qualify only for a $1,000 limit
B. Promote credit cards with ‘‘up to’’ limits and charge a nonrefundable annual fee of $100 per account, due with the application and before the consumer is told the actual account limit
C. Raise interest rates on borrowers who default on loans to other creditors, without disclosing this practice
D. Offer a promotional rate for only 90 days after the card is activated
D
Mrs. Williams applies to rent an apartment from Better Living Apartments. She has been a customer of First National Bank for several years, so she lists the bank as a credit reference. Better Living sends the bank a credit inquiry letter, and the bank sends Better Living a list of Mrs. Williamsﾒs bank transactions. The report states that she has had several insufficient checks on her account over the last two months and that she has satisfactorily paid off a car loan. Better Living calls the bank and speaks to Consumer Loan Officer George Dillon. Mr. Dillon states that Mrs. Williams applied for a loan three months ago, and he denied the loan because of a slow-pay report from ABC Department Store that appeared on Mrs. Williamsﾒs credit report. Did the bank give Better Living a consumer report under the Fair Credit Reporting Act?
A. No. Providing limited amounts of information from others will not cause the bank to be covered under the Fair Credit Reporting Act.
B. Yes. By giving deposit-related information concerning returned checks, the bank created a consumer report.
C. Yes. The bank gave credit information it received from another source.
D. No. The ABC Department Store information was part of the bank’s own experience, because it was used by the bank to make a credit decision.
C
Which of the following is a NOT a responsibility of a regulated financial institution under the SAFE Act?
A. Hire mortgage loan originators as employees
B. Ensure that mortgage loan originators that are employees register with the Registry
C. Adopt policies and procedures for compliance with the SAFE Act
D. Submit required information on the bank to the Registry
A
In a review of a bankﾒs home mortgage loan application register, which of the following must be included?
A. Loans made or purchased in a fiduciary capacity
B. Servicing rights purchased
C. Interim construction loan applications
D. Loans made and sold within the reporting period
D
The compliance officer gets a call from the head of the Mortgage Department who informs the compliance officer that they are planning to make a second lien mortgage loan on a residence. The property is located in a Special Flood Hazard Area requiring flood insurance, but the customer is objecting to getting flood insurance. The customer says that the first lienholder never required it, so why is our bank requiring it. The compliance officer should tell the Mortgage Department head…
a. If the first lienholder didn’t require the flood insurance, we, the second lienholder, don’t have to either
b. We do need to require the borrower to obtain flood insurance that fully covers the property including the first lien loan balance
c. We do need to require the borrower to obtain flood insurance that covers our second lien loan amount
d. We cannot make the loan, because the first lienholder did not properly require flood insurance
B
With regard to standards for wear and use of leased property, which of the following statements is true?
A. A lessor must adhere to the manufacturer’s standards for wear and use of the leased property.
B. A lessor must develop and disclose its own standards for wear and use of leased property.
C. A lessor must provide a notice of wear and use standards on motor vehicle leases.
D. A lessor need not provide a notice of wear and use standards on motor vehicle leases if the lessor imposes an automatic, standardized charge.
C
A Notice to Home Loan Applicant under the FCRA must include:
a. A statement that if the consumer has questions about the terms of the loan, the consumer should contact the consumer reporting agency
b. A statement that the lender plays no part in the credit decision
c. A statement describing what a credit score is
d. A statement that credit scores are not as important as income in determining whether a consumer will receive credit
C
First National Bank has an employee benefit program whereby all bank employees who meet the banks credit underwriting standards may obtain consumer loans for major purchases or expenses at a rate that is less than the banks prime rate. Can the bank allow its executive officers to borrow under this program?
A. No. Executive officers may not have preferential interest rates under any circumstances.
B. No. However, the related interests of the executive officers may take advantage of it.
C. Yes. However, executive officers must secure their loans with collateral valued at 100 percent of the loan balance or more.
D. Yes. Provided the program is available to everyone at the bank as an employee benefit, executive officers may also participate
D
Of the following, which is the most likely to be a violation of Regulation C?
A. The MSA number, instead of the MSA name, is used for each loan and application
B. The ‘‘reasons for denial’’ column is blank
C. Race, national origin, and gender information are not included for purchased loans
D. The gender of the applicant is designated by the letters M or F
D
Your bank has decided to discontinue offering debit cards to business customers. Debit cards are currently in the hands of only about 100 business customers who have business checking accounts at the bank. You are asked about what kind of notice, if any, is needed to these customers to discontinue the debit cards that these customers already have. Your first step should be to:
a. Review Regulation B adverse action notice requirements
b. Review Regulation Z change in terms notification requirements
c. Review the cardholder agreement for notification requirements
d. Review Regulation E change in terms notification requirements
C
First National Bank has obtained a judgment against Morris Smith for a defaulted consumer debt. The judgment is for $9,500 of principal plus interest accrued through the date of default and $500 in interest and late charges incurred since the date of default. Morris brings $5,000 to the bank as a partial repayment of the debt. How must the bank apply the money under federal law?
A. The entire $5,000 must be applied to the principal amount owing.
B. The $5,000 must be applied first to interest accrued up to the date of the default, then to principal.
C. The bank can apply the money to any amounts owed at its discretion.
D. The bank must apply the money first to interest and late charges accrued after the date of the default.
C
A bank does not know all of the specific information to be disclosed on the lease at the time of the consummation. What may the bank do after attempting to obtain the information?
A. Omit the unknown disclosures
B. Estimate the amounts and note that the information is estimated
C. Delay consummation of the transaction until the information is ascertained
D. Estimate the information based on averages of all other leasing transactions the bank has made
B
Which one of the following loan purposes is NOT an acceptable “Loan Purpose” disclosure for the Loan Estimate or Closing Disclosure form on page 1?
a. Purchase
b. Construction
c. Home Improvement
d. Home Equity Loan
C
How is the maximum loan value of margin stock defined?
A. As a percentage of the amount to be loaned
B. As a percentage of the book value of the stock
C. As a percentage of the current market value of the stock
D. As a percentage of the good-faith loan value of the stock
C
Martha Winters obtained a loan from First National Bank to purchase her living room furniture. The bank took a security interest in the furniture as collateral on the loan. Before the end of the loan term, Martha refinanced the remaining balance of the furniture loan at Second National Bank. Can Second National Bank take a security interest in the furniture?
A. Yes, but only if it obtains an assignment of First National’s security interest
B. Yes, because the loan is a refinancing of a purchase-money transaction
C. No, a nonpossessory security interest in consumer goods is prohibited
D. Yes, furniture is not considered to be household goods under the regulation
A
Second State Bank offers a mortgage product that involves simultaneous second lien loans. These include a first lien for up to 90 percent of the purchase price and a second loan for the down payment, secured by a second lien on the property. The bank would like to be in full compliance with the Interagency Guidance on Nontraditional Mortgage Product Risks. Which of the following should Second State Bank incorporate into its loan program?
A. Risk management procedures to measure the risk of all simultaneous second lien loans and report results to management
B. A 100 percent loan loss reserve on all simultaneous second lien loans
C. A product combining simultaneous second lien loans with negative amortization features made to nonowner occupied borrowers
D. A prepayment penalty on all simultaneous second lien loans
A
First National Bank is located outside an MSA. It received 120 home loan applications last year. Which statement best describes the banks Fair Housing recordkeeping requirements?
A. It may either keep the Home Loan Data System records, or it may keep the HMDA LAR information.
B. It must complete up to 2,000 Home Loan Data Submission Forms per bank or 250 per decision center and submit them to the OCC within 30 days.
C. It must keep a HMDA LAR.
D. It must keep the Home Loan Data System records.
A
Which of the following elements would NOT be a potential indicator of redlining?
A. The absence of census tracts with a racial minority character within an institution’s assessment area
B. The presence of census tracts with a racial minority character immediately adjacent to but outside of an institution’s assessment area
C. A special marketing program aimed at racial minority groups within an assessment area
D. Non-minority geographies that appear to have been given favorable treatment
C
Which of the following national banks must keep an Inquiry/Application Log?
A. A bank that had 50 or more home loan applications in the previous year
B. A bank that has $50 million or more in assets
C. A bank that is located in an MSA
D. A bank that has been requested by the OCC to keep such a log because of complaints that its lending practices may be discriminatory
D
You, as compliance manager for the bank, are asked to participate in a meeting to plan a training program for commercial loan officers for the upcoming year. Which of the following regulatory topics would you recommend to be included in the training program?
a. What constitutes a changed circumstance
b. Adverse action notification procedures
c. Ability to repay guidelines
d. Early disclosure timing requirements
B
First National Bank has denied a credit application from Mr. Johnson because the application scored too low on the bankﾒs internal credit-scoring system. Mr. Johnsons credit report, received from a credit reporting agency, scored a 4 out of a possible 10. Other parts of Mr. Johnsons application received low scores also. Which statement best describes First Nationals responsibility to Mr. Johnson under the Fair Credit Reporting Act?
A. Send an adverse action notice that states the reasons the credit was denied
B. Send a notice that a credit report was used
C. Send an adverse action notice that states that a credit report was used and gives the name and address of the credit reporting agency
D. Send an adverse action notice that summarizes the information on the credit report
C
Under the Fair Debt Collection Practices Act, a debt collector may not:
a. Accept checks that are post dated by more than 1 day
b. Accept post dated checks
c. Solicit a post dated check for payment of a debt for purposes of avoiding additional communications with the debtor
d. Solicit a post dated check for payment of a debt for purposes of threatening criminal prosecution
D
Assume that the properties involved in the following loans are located in special flood hazard areas. Which loans would NOT require flood insurance as a condition of the loan?
A. A mortgage loan made to a consumer secured by a residence in a community in which flood insurance is available
B. A commercial loan secured by residential real estate located in a community in which flood insurance is available
C. A consumer loan secured by a lake house located in a community in which flood insurance is not available
D. A loan for the purpose of making investments secured by commercial rental property located in a community in which flood insurance is available
C
For how long may consumers exercise the right to rescind transactions in closed-end loans?
A. Three years after the consummation of the transaction
B. Three calendar days after the consummation of the transaction or the receipt of notice of the right to rescind, whichever is later
C. Three business days after the later of the consummation, delivery of notice of the right to rescind, or delivery of required disclosures
D. Three business days after the receipt of the early disclosures
C
The federal banking agencies have proposed an amendment to Regulation Z that would require a new early disclosure statement for loans secured by the borrowers principal dwelling. After reading the proposed change, what should the compliance professional do FIRST?
A. Establish a task force to study the proposed rule.
B. Contact the bank’s platform software vendor to determine whether it will be ready for the change
C. Prepare a summary document that outlines the effects the proposed rule would have on the bank’s operations
D. Train bank staff on the new rule
C
Several types of loan-related data appear in the following list. Which type of data is NOT required to be reported under HMDA?
A. Data on multifamily housing
B. Data on unsecured home improvement loans
C. Data on refinancings of home purchase loans
D. Data on loans to purchase residential lots
D
First National has an account for Mary Jones, who has had several overdrafts in her account over the past few months. On February 15, she overdrew her account and had a negative balance, which lasted for 10 days. As of March 14, the number of negative days in the statement cycle was three; and as of April 14, the number of days was six. The last overdraft occurred on May 14, and the account was overdrawn for three days. Mary has not been overdrawn since May. First National has extended the holds placed on all deposits to her account. How long can the bank continue to subject her account to extended hold periods?
A. Until May 14
B. Until October 14
C. Until July 14
D. Until April 14 of the next year
B
When does a notice that the borrowers property is located in a special flood hazard area have to be given to the borrower?
A. Before making a commitment to lend
B. Within 10 days after closing
C. At the time of the application
D. Within a reasonable time before completion of the transaction, but no later than the bank sends other notices concerning insurance or taxes
D
Which of the following methods is NOT valid for determining which consumer borrowers should receive a risk-based pricing notice?
A. The credit score proxy method
B. The direct comparison method
C. The tiered pricing method
D. The comparative file method
D
Which of the following describes the record retention requirements under Regulation B for a credit application from a business with annual gross revenues in excess of $1,000,000?
A. The bank must retain records for 30 days; however, if a written statement of action is requested, the bank must retain the records for 90 days.
B. After 6 months, the bank must dispose of the applications and records in accordance with waste disposal rules promulgated by the EPA.
C. The bank must retain records for 12 months if a written statement of adverse action is requested within 60 days after notifying the applicant of the action taken.
D. The bank must retain records for 25 months from the date of application.
C
To what amount must a bank limit interest on debts under SCRA unless otherwise determined by a court?
A. A rate, specified by military counsel, based on the servicemember’s financial condition at the time of call to active duty
B. The Wall Street Journal’s Prime Rate in effect at the time of the servicemember’s call to active duty
C. Six percent for all accounts made prior to the servicemember’s call to active duty
D. The amount needed to fully amortize the debt while the servicemember is on active duty
C
Acme Mortgage has filed a foreclosure action on the property securing John Does mortgage. The foreclosure sale will be held in 120 days. If Acme receives an application for a loss mitigation option from Mr. Doe 100 days from the foreclosure date, which of the following actions must Acme take?
A. Withdraw the foreclosure action within 30 days of the receipt of the application
B. Notify the borrower of the decision on the completed application within 14 days of the receipt of the application
C. Notify the borrower of any missing information within 10 days of the receipt of the application
D. Acknowledge the application in writing within 5 days of receipt of the application
D
To which of the following do national bank and savings association lending limit rules apply?
A. Loans secured by savings bonds
B. Loans secured by Treasury bills
C. Loans secured by third-party guarantees
D. Loans secured by customer deposits
C
Alicia Perez telephoned the customer service department at First National Bank and requested to have $300 debited from her account and sent to her sister in Peru three days later. Which of the following alternatives best states the banks responsibilities to Ms. Perez?
A. Provide a written prepayment disclosure and receipt to Ms. Perez as soon as possible, but before the transfer is made.
B. Provide a written prepayment disclosure within one business day of the request; a receipt is not required
C. Provide an oral prepayment disclosure at the time of the request
D. Provide an oral prepayment disclosure at the time of the request and the receipt information on the next account statement
D
When may a bank force the placement of flood insurance on the borrowers property?
A. Immediately on the expiration of the flood insurance
B. Ten days after notifying the borrower
C. Twenty-one days after notifying the borrower
D. Forty-five days after notifying the borrower
D
For purposes of insider lending laws and regulations, what is the definition of the term executive officer?
A. All bank officers at or above the level of executive vice president
B. Anyone who has the authority to participate in major policymaking functions at the bank
C. Anyone who has the authority to participate in lending decisions at the bank
D. All bank officers at or above the level of assistant vice president
B
The receipt of an EFT must include which of the following terms, as applicable?
a. Posting date of the transaction
b. Institution’s toll-free telephone number
c. Calendar date of the transaction
d. Institution’s address
C
Which of the following loans does NOT require flood insurance?
Loan A is a commercial loan that has been on the books for two years and has been renewed twice. Flood insurance was legally required on the loan at the time it was made. There was a flood insurance policy in effect at the loanﾒs inception, but it expired and was not renewed.
Loan B is a consumer loan secured by a mobile home that is located in a flood hazard area in which federal flood insurance is not available.
Loan C is a commercial loan that the bank would be willing to make on an unsecured basis, but the borrower has offered some commercial real estate property as collateral.
The property has one vacant building on it, and it is in a flood hazard area in a community where federal flood insurance is available.
A. Loan A
B. Loan B
C. Loan C
D. None of the loans
B
First National Banks mortgage lending department makes reverse mortgage loans. The bank services all of these loans and, in fact, has never sold or transferred the servicing of any loan it originated. When the bank receives a consumerﾒs reverse mortgage transaction application, what disclosures must the bank make at the time of application?
A. Give the applicant a Good Faith Estimate of settlement costs, a Special Information Booklet, and a HUD-1 Settlement Statement
B. Give the applicant a Good Faith Estimate of settlement costs, a Special Information Booklet, and a Servicing Disclosure Statement
C. Do not give the applicant any RESPA disclosures, because the bank never sells or transfers servicing of its loans
D. Give the applicant a Good Faith Estimate of settlement costs and a Servicing Disclosure Statement
D
First National Bank uses one contract for both commercial and consumer credit. The contract contains a confession of judgment clause. What must First National do to comply with the Regulation AA prohibition against such clauses in consumer contracts?
A. Allow the clause to remain in the contracts but do not enforce it in consumer transactions
B. State on the contract form that the confession of judgment is not applicable in a consumer transaction
C. Cross out the clause when the form is used in a consumer transaction
D. Add a statement to the contract in which the borrower agrees to characterize every transaction as a commercial transaction
C
If a loan is to be secured by a consumers principal dwelling, which of the following actions is prohibited with regard to an appraiser?
A. The banker does not understand the comparable values in an appraisal and asks the appraiser to clarify the information.
B. The banker tells the appraiser that the appraisal will need to show that the property is worth at least $100,000, or the bank will not be able to make the loan.
C. The banker notices that there is a factual error in the appraisal and asks the appraiser to correct it.
D. The banker refuses to pay for an appraisal submitted past the date that the appraiser agreed to provide it.
B
In which of the following cases must a furnisher of consumer information investigate the dispute?
A. A dispute submitted by a credit repair company on behalf of one of the furnisher’s customers
B. A dispute submitted by one of the furnisher’s customers on a form supplied by a credit repair company
C. A dispute about a charged off loan for which the consumer refused to provide his social security number
D. A dispute about a delinquent account that has been previously submitted but upon which the furnisher took no action
D
During a recent compliance examination, regulatory examiners found that the bank was not conducting flood hazard area determinations before closing on construction loans. The compliance professional has reviewed the files and agreed with the examiners finding. What should be done FIRST?
A. Review the bank’s flood policies and procedures to determine where the compliance failure occurred
B. Conduct a risk assessment of the flood determination requirement on construction loans
C. Prepare an analysis for bank management explaining the requirement
D. Review all construction loan files to determine the extent of the problem
A
What may a creditor do when furnishing credit information?
A. May designate accounts in any manner that is convenient and reasonable
B. Must designate accounts as specified by the parties
C. Must designate accounts to show participation by both spouses if both are liable
D. Must designate accounts to show all parties, including guarantors
C
Consumer reports used for credit transactions may contain which of the following items?
A. Records of bankruptcies for 7 years
B. Adverse credit items for 7 years and bankruptcies for 10 years
C. Records of arrests or convictions for 10 years
D. Paid tax liens for 10 years
B
Robin Martin made an individual application to the bank for a car loan. She has just returned to work on a regular basis because she was a full-time homemaker until recently, when her last child entered school. The loan officer would like to ask her about her husband. Under what circumstances can the officer ask Robin about her husband?
A. The creditor believes the spouse’s signature will make the applicant more creditworthy.
B. The applicant is married.
C. The applicant resides in a community property state.
D. The applicant’s credit reports indicate that the spouse is a better credit risk.
C
First National Bank has a general lending limit of $150,000 and an additional limit of $100,000 for loans that are fully secured by readily marketable collateral. The bank has outstanding to Peter Phillip an unsecured loan for $150,000. Which of the following is legal?
A. The payment of an overdraft on Mr. Phillip’s account
B. An additional unsecured loan to Mr. Phillip where the entire loan is sold as a participation to a correspondent bank without recourse to First National
C. The issuance of a standby letter of credit for the account of Mr. Phillip
D. The extension of credit to a general partnership in which Mr. Phillip is a partner
B
Which of the following is required to be reported on ABC Banks HMDA LAR?
A. An application from Mr. Welch for a preapproval of a home purchase loan application that is approved by ABC in writing but not accepted by Mr. Welch
B. An application from Ms. Ensley for a preapproval of a temporary construction loan that is denied by ABC
C. An application from Mr. and Mrs. Rawlings for a preapproval of a home purchase loan application that is denied by ABC
D. An application from Ms. Connor for a home equity loan to be used to consolidate credit cards
C
Which of the following loans is NOT subject to Fair Housing monitoring requirements for housing-related loans made by a national bank located outside a metropolitan statistical area (MSA)?
A. A loan to purchase a mobile home
B. A loan to provide permanent financing for the construction of a residence
C. A loan to purchase a residence
D. The refinancing of a home purchase loan
A
The following statements make assertions about the collection and reporting of data on race, ethnicity, sex, and income. Which statement is false?
A. It must be requested on all HMDA-reportable applications received in person from natural persons.
B. It must be requested only for the loans where the application is taken in person.
C. It must be reported unless the loan was purchased.
D. It must be requested verbally on telephone applications.
B
Which of the following is the correct response to consumer written requests that they not be contacted again by debt collectors?
A. Collectors may send final demand letters.
B. Collectors may send letters explaining that defaulted obligations are being turned over to attorneys for legal action.
C. Collectors may call and ask for verification of requests to cease communications.
D. Collectors may send letters that remind debtors of their legal obligations under the credit contracts.
B
As part of an effective compliance management program a compliance officer can monitor customer complaints received by the bank for the purpose of:
a. Verifying the bank’s compliance with Regulation AA
b. Identifying possible product and service enhancements
c. Identifying regulatory compliance problems in bank operations
d. Identifying customers who should be monitored for suspicious activity
C
First National Bank agreed to make a rescindable closed-end home improvement loan to Mr. and Mrs. Smith. The Notice of the Right to Rescind was given to the Smiths on Tuesday at the closing of the loan along with the material disclosures. The Smiths purchased a title policy and paid for a property appraisal for the bank in connection with the transaction. A lien was filed against the Smiths home on Tuesday afternoon. The bank funded the loan on Friday morning at the request of Mr. Smith by crediting the Smiths joint checking account with the loan proceeds. On Friday afternoon Mrs. Smith has a change of heart concerning the transaction and deposits a rescission notice in the mail to the bank. The bank receives the notice on Tuesday morning. All funds have been withdrawn from the account. What should the bank do?
A. Notify the Smiths that the loan proceeds are immediately due and payable and that once the funds are repaid, the lien on the property will be released
B. Release the lien on the property immediately, then refund to the Smiths the amounts they spent for the title policy and appraisal, and then demand repayment of the loan (without interest)
C. Release the lien on the property immediately, and then send a written request to the Smiths asking for repayment of the loan proceeds (without interest)
D. Send a letter to the Smiths explaining that because the rescission notice was not sent within the proper time period, it is ineffective and the loan is still valid
B
When comparing closing costs on the Loan Estimate form to the Closing Disclosure, which fees are subject to the zero tolerance?
a. Prepaid interest
b. Fees paid to unaffiliated third parties for services that the consumer is permitted to shop for
c. Origination charges
d. Recording fees
C
Marie Fosse has a mortgage with lender-required PMI. Her loan is covered by the Homeowners Protection Act of 1998. On March 15, 2004, the principal on her loan was at 78 percent of the value of her home. She was 30 days past due on her loan on March 15. On July 15, 2004, her loan will be at the half-way point of its amortization schedule. On May 15 she catches up with her payments and is current on her loan at that time. Which of the following statements is true?
A. The lender should have terminated the PMI on March 15.
B. The lender should terminate the PMI by May 15.
C. The lender should terminate the PMI by June 1.
D. The lender should terminate the PMI by July 15.
C
When credit card checks accessing open-end accounts (not home secured) are sent to a borrower and the finance charge terms are different than originally disclosed, when must the disclosures be displayed prominently on the front page of the checks?
A. When provided at the time the account is opened
B. When provided more than 30 days after the account is opened
C. When provided in the same envelope as the credit card
D. When provided more than 10 days after the account is opened
B
ABC Lender is located in a state with a consumer protection law requiring lenders to limit the APR on vehicle title loans to 24 percent. Which of the following is true for ABC Lender?
A. ABC Lender must abide by state law and limit its vehicle title loans to 24 percent to servicemembers
B. The federal regulation preempts state law and ABC may charge up to 36 percent since it is governed primarily by state law
C. ABC has a choice of law; it may choose either the federal regulations or the state law
D. ABC may charge up to 36 percent for nonservicemember borrowers
A
Which of the following practices is NOT prohibited by RESPA?
A. A lender requiring the borrower to pay a fee for the preparation of a HUD 1 settlement statement
B. A seller conditioning a property sale (that involves a federally related mortgage) on the buyer’s purchase of title insurance from a certain title company
C. A lender requiring a consumer to pay for the preparation of documents by a certain attorney
D. A bank paying a referral fee to an independent real estate agent who has generated new mortgage loan customers
C
For which of the following deposits is a bank required to give next-day availability (assume that all checks are deposited into the account of the payee)?
A. A deposit of pesos
B. A deposit of a Social Security check by mail
C. A deposit of a U.S. Postal Money Order by mail
D. The deposit of a cashier’s check through the night deposit box
B
For how long must a lender retain evidence of compliance with the Truth in Lending Act?
A. One year following consummation of the transaction for all transactions
B. Twenty-five months from the date of the application, except for mortgages, which have a five year retention requirement
C. Six months from the date the loan is repaid, except for mortgages, which have a five year retention requirement
D. Two years after the disclosures are required to be made, except for mortgages, which have a five year retention requirement
D
For what do ECOA and Regulation B extend coverage?
A. All types of credit
B. Only consumer credit
C. Only consumer credit of $25,000 or less
D. Only consumer and business credit with gross revenues of $1 million or less
A
Hector Martinez is a loan officer in a non-community property state. He receives a verbal request for a small business working capital loan from Leon Rogers for his technology consulting business. The business is a sole proprietorship. Mr. Rogers gives Hector a written business plan for his business, a financial statement for the business for the past two years, and a personal financial statement that includes information on himself and his wife. Can Hector assume that the application is a joint application from Mr. Rogers and his wife?
A. Yes. Because the financial statement is signed by both Mr. and Mrs. Rogers and includes joint information, the application can be considered to be from both spouses.
B. Yes. Because the business is a sole proprietorship, the spouse’s financial information is important.
C. No. The bank cannot assume the application is a joint one simply on the basis of submission of joint financial information.
D. No. Because the business is a sole proprietorship, the bank should assume the application is for individual credit.
C
First State Bank, a state nonmember bank, is auditing its recordkeeping procedures for compliance with the FDIC Fair Housing regulations. Which loan should be reviewed?
A. A loan to purchase a mobile home to be used as a vacation home
B. A home equity line of credit
C. A loan to purchase vacant land for the construction of a residence
D. A home purchase loan
D
Records regarding compliance with Regulation M must be kept for how long?
A. Five years following consummation of the lease
B. Two years after the disclosures are made
C. Twenty-five months from consummation
D. One year from the time the disclosures are made
B
Mr. Hilliard applied to First National Bank for a car loan. The bank requested a credit report on Mr. Hilliard from the local credit reporting agency and found that he had almost no credit. No negative items were on the report. In addition, Mr. Hilliard had been employed at his job for four months and his previous work experience was difficult to verify. The bank denied his application for a loan and sent him an adverse action notice. What should the bank do under the Fair Credit Reporting Act?
A. Notify Mr. Hilliard that a credit report was obtained and give him the name and address of the credit bureau.
B. Nothing. The bank has no responsibilities under the Fair Credit Reporting Act because the credit report contained no adverse items.
C. In person or over the telephone, explain to Mr. Hilliard that, although the credit report had no negative items, he has too little credit history.
D. Give Mr. Hilliard a copy of the credit report.
A
Which of the following actions is most likely to be prohibited under the Fair Debt Collection Practices Act?
A. Pursuant to a corporate policy, individual collectors using an alias when contacting consumers
B. Calling a consumer’s neighbors to leave messages when the consumer has a telephone
C. Telling a consumer that a lawsuit would cause the consumer inconvenience and embarrassment
D. Referring to the fact that a consumer could be subjected to criminal prosecution for issuing bad checks
B
