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ABA CRCM Practice Test - Questions Answers, Page 46

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List of questions

Question 451

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A bank that is a government securities broker accepts money from a customer for the purchase of securities on Monday and does not purchase the securities by the end of the day on Tuesday. Does the b

Question 452

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Which of the following elements is NOT required to be in a repurchase agreement between a bank that is a government securities dealer and a counterparty?

Question 453

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What is the maximum number of government securities transactions a bank may have and still remain exempt from the Government Securities Act?

Question 454

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Transactions with which of the following government securities would NOT subject a bank to the registration requirements of the Government Securities Act?

Question 455

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In which of the following situations is the bank NOT required to report lost or stolen securities?

Question 456

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Jayne Logan, a loan officer at State National Bank, has recently recruited Mr. David Roberts as a new loan customer. She has known Mr. Roberts for 10 years and handled his lending transactions at an

Question 457

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Generally, a financial institution is required to ascertain if securities certificates they have taken by pledge, transfer, or otherwise have been reported as missing, lost, counterfeit, or stolen.

Question 458

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How long after discovery does a bank have to report any lost or missing securities when criminal activity is suspected?

Question 459

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A compliance officer receives a call from a loan officer who asks for adv ice on what she should do with a stock certificate (1,437 shares of IBM) from a new loan customer who wants to pledge it in

Question 460

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A recent audit revealed that the bank's personal trust division was failing to determine whether securities being accepted from new trust customers have been reported as lost or stolen. To address t

Related questions

Which of the following customers may be exempted under Phase II of the Bank Secrecy Act?

Martha Whitmire, the BSA Compliance Officer for First National Bank, is responsible for monitoring the bank's daily currency activity and wire transfers, for compliance with information retention and reporting requirements. Ms. Whitmire notices during her review on March 10 that, during the previous two weeks, a transaction occurred on the same account several times during the week. The activity appeared at one branch office as cash deposits in dollar amounts under the reporting thresholds. Ms. Whitmire discusses this activity with the branch manager and determines that this same deposit activity occurred several times during the previous six weeks. She then conducts a more extensive examination of the account's activity for several months and discovers that cash deposits were made at one branch office and purchases of bank cashiers checks were made by withdrawals from the same account at a different branch office. All withdrawals and purchases of cashier's checks were for the identical amount as the cash deposits.Which statement best describes Ms. Whitmire's responsibility?

Fastfood, InC. , a nationwide restaurant chain, opened an account at First National Bank last year. Fastfood is making daily deposits in amounts of $15,000 to $20,000. First National needs to determine if this company is an exempt person. What should the bank do first?

Banks must establish and maintain effective risk management and control processes over its DCCs and DSAs, including:

Bob's wife is HIV-positive due to a blood transfusion during an appendectomy 15 years ago. She is not yet sick, but takes medication to prevent the onset of AIDS. Bob occasionally needs to take time off from work to take her for testing at Johns Hopkins in Baltimore. Because of complaints about Bob's exposure to this disease, employees have asked HR to limit his contact with them and with customers. The bank has asked Bob not to eat in the lunchroom with the other employees and has placed Bob in a position where he has limited customer contact. Does this company have any potential ADA liability?

In April Lillian Redmond, the teller supervisor for First National Bank, discovers five counterfeit $20 bills in several teller drawers. In May and in June she discovers two additional counterfeit $20 bills. She has no knowledge of criminal activity on the part of any of the bank's employees or customers. She does not suspect any particular person in this transaction. Which of the following statements is true?

A financial institution may provide a customer with a short form initial notice at the same time as it delivers an opt-notice. The short form notice must:

What insurance disclosures are required in the lease disclosure statement?

The compliance program should address plans to verify adherence to applicable regulations through:

A compliance officer receives a call from a loan officer who asks for adv ice on what she should do with a stock certificate (1,437 shares of IBM) from a new loan customer who wants to pledge it in support of a loan that has been approved at your bank. What should the compliance officer tell her FIRST?

Question 451

A bank that is a government securities broker accepts money from a customer for the purchase of securities on Monday and does not purchase the securities by the end of the day on Tuesday. Does the bank have any responsibilities under the Government Securities Act?

No. The bank has fulfilled its responsibilities under the Act.

Yes. The bank must purchase the securities before the close of business on Wednesday.

Yes. The bank must deposit the money in an account of the customer at the close of business on Tuesday.

No. The bank has until the close of business on Wednesday to purchase the securities before being liable to the customer for failure to effect a purchase.

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Question 452

Which of the following elements is NOT required to be in a repurchase agreement between a bank that is a government securities dealer and a counterparty?

A statement that the funds are not insured by the FDIC

A list of the specific securities that are the subject of the agreement

A provision for substitution of securities if they can be substituted

A statement that the bank is a regulated government securities dealer

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Question 453

What is the maximum number of government securities transactions a bank may have and still remain exempt from the Government Securities Act?

100 per year

250 per year

400 per year

499 per year

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Question 454

Transactions with which of the following government securities would NOT subject a bank to the registration requirements of the Government Securities Act?

Obligations of the Farm Credit System

GNMA securities

U.S. Savings Bonds

FNMA obligations

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Question 455

In which of the following situations is the bank NOT required to report lost or stolen securities?

When bonds were expected to be delivered in person from the local Federal Reserve Bank and were not received

When stock traded on the over-the-counter exchange (OTC) was expected to be received through the mail from a customer's broker

When securities with no CUSIP numbers were expected from another financial institution

When stock traded on the New York Stock Exchange (NYSE) was expected to be delivered by the issuer's agent

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Question 456

Jayne Logan, a loan officer at State National Bank, has recently recruited Mr. David Roberts as a new loan customer. She has known Mr. Roberts for 10 years and handled his lending transactions at another bank where she previously worked. As his first transaction with State National Bank, Mr. Roberts pledges stock that is traded on the NYSE. The stock is received directly from Mr. Roberts, who has his secretary personally deliver it to the bank. Is the bank required, in this instance, to send a lost or stolen securities inquiry regarding the stock? Why or why not?

No. Because Ms. Logan has known Mr. Roberts for more than five years, no inquiry must be sent.

Yes. Because Mr. Logan is a new customer to the bank, the inquiry must be sent.

No. Because Mr. Logan's secretary personally delivered the stock certificates, no inquiry must be sent.

Yes. All stock pledged against a loan that is traded on the NYSE must have an inquiry sent.

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Question 457

Generally, a financial institution is required to ascertain if securities certificates they have taken by pledge, transfer, or otherwise have been reported as missing, lost, counterfeit, or stolen. When is it NOT required to take such actions?

When the securities certificate is received directly from the issuer or issuing agent at issuance.

When the bank officer personally knows the individual pledging the certificate.

When the securities certificate received as part of a transaction has a face value of $20,000 or less.

When the securities certificate is received directly from an insured delivery service.

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Question 458

How long after discovery does a bank have to report any lost or missing securities when criminal activity is suspected?

90 calendar days

1 business day

Never. Law enforcement must report

10 business days

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Question 459

Retain a copy of the certificate in the loan file

Retain the original certificate in the branch vault for the term of the loan

Record the certificate information and give the original back to the customer

Contact the SIC to determine if the certificate was reported as lost, counterfeit, or stolen

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Question 460

A recent audit revealed that the bank's personal trust division was failing to determine whether securities being accepted from new trust customers have been reported as lost or stolen. To address the root cause of this problem, what should the compliance officer do FIRST?

Inquire with the SIC about all securities noted in the audit

Contact the bank's primary regulator to determine the best course of action

Retrain all personal trust administrators on the lost and stolen securities requirements

Review the policies and procedures for accepting securities in new personal trust relationships to ensure securities verification

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