UDAAP

Question 1

Taking advantage of a consumer’s inability to understand the terms or conditions of a financial services product would be considered:
a. Deceptive
b. Abusive
c. Unfair
d. Unproductive

Answer 1

b. Abusive

Question 2

Acme Bank published an advertisement for its new deposit account that has no service charge. The bank advertised the account as a “free” account since there are no charges associated with maintaining the account. If an accountholder overdraws their balance, an overdraft fee will be charged, and if the overdrawn amount is outstanding for more than five days, an additional continuing overdraft charge will be added. What UDAAP issue, if any, is a concern?
a. Deception
b. Unfairness
c. Abusiveness
d. None

Answer 2

a. Deception

Question 3

Which of the following is a key to the “unfairness” standard in UDAAP?
a. The term or condition involved must be material to the consumer
b. It must cause substantial injury
c. It must take advantage of the reasonable consumer
d. It must be published in print or digital form

Answer 3

b. It must cause substantial injury