Securities Flashcards
A lender may not lead a consumer to believe that a loan is conditioned on either the purchase of insurance or an annuity from the bank or an affiliate, OR
an agreement by the consumer not to obtain insurance or an annuity from an unaffiliated entity
A bank may not engage in any practice or use any advertisement at any office of, or on behalf of, the bank that could mislead a consumer to believe that:
* the insurance is FDIC insured
* there is no investment risk, including the potential loss of principal
* a loan at the bank in conditioned on the purchase of insurance products
* the consumer is not free to purchase the insurance product from another source
Insurance sales disclosures must be provided before the completion of:
the initial sale of the insurance product or annuity to the consumer
All insurance product required disclosures must be provided:
orally AND in writing
Consumers must acknowledge insurance disclosures in writing, either electronically or in paper format, at the time:
the disclosure is received or the initial purchase is made
What disclosures are required in all advertisements for insurance products or annuities:
not a deposit, not FDIC insured, not insured by any federal agency, not guaranteed by the bank, may go down in value
The area where insurance products are sold must be:
physically segregated from areas where deposits are routinely accepted from the general public
Persons selling insurance products as bank employees or on behalf of the bank must be appropriately qualified and licensed under:
applicable state insurance licensing standards
Generally, banks should ensure that retail NDIP customers are fully informed as to:
the nature and risks associated with the investment
What are the minimum disclosure requirements for NDIP?
* not insured by FDIC
* not deposits or obligations of the institution
* not guaranteed by the bank
* subject to investment risk, including loss of principal
When should NDIP disclosures be provided?
* orally, during any sales presentation
* orally, when investment advice concerning NDIP is given
* orally and in writing before the opening of an investment account
* in all advertisements
NDIP disclosures must be acknowledged by customers in writing with a statement that:
the customer understands the disclosures
What is the allowed abbreviated advertising disclosure for NDIP?
Not FDIC insured, No Bank Guarantee, May Lose Value
A NDIP is not allowed to have a product name that:
is identical to the name of a depository institution
If the NDIP has a name similar to a retail banking product, it should be designed and presented in a sales program in a way that:
minimized the risk of confusion to the customer
