Federal Laws And Regulations Trivia! Quiz Questions

The explanation for the given correct answer is that the Equal Credit Opportunity Act (ECOA) was enacted to ensure that credit is accessible to all individuals who are creditworthy, regardless of their gender or marital status. The ECOA also prohibits credit discrimination based on various factors such as race, color, religion, national origin, gender, marital status, age, or receiving public assistance. Therefore, it is true that the ECOA's purpose is to make credit equally available to all creditworthy customers without regard to gender or marital status.

Debt collectors are prohibited from using obscene or profane language, causing a telephone to ring repeatedly to annoy or harass a person, and using misleading information to collect from a person. These actions are considered unethical and can be seen as harassment or deception.

UDAAP stands for Unfair, Deceptive or Abusive Acts or Practices. This acronym is commonly used in the financial industry to refer to any practices that are considered unfair, deceptive, or abusive towards consumers. UDAAP regulations aim to protect consumers from being taken advantage of by financial institutions or other businesses. These regulations require businesses to be transparent, honest, and fair in their dealings with consumers, and they prohibit any practices that may mislead or harm consumers.

Refusing to release a lien after a consumer makes a final payment would be considered an Unfair, Deceptive or Abusive Acts or Practices (UDAAP) violation. This is because it is unfair and deceptive to hold onto a lien even after the consumer has fulfilled their payment obligations. It goes against the principles of fairness and transparency in consumer transactions.

The Gramm-Leach-Bliley (GLB) Act is a law that mandates financial institutions to protect the security and confidentiality of a customer's personal financial information. This means that companies falling under the definition of "financial institutions" are legally obligated to implement measures and safeguards to prevent unauthorized access or disclosure of customer data. Therefore, the statement "True" is the correct answer as it accurately reflects the requirement stated in the GLB Act.

The correct answer is "All of the above." The Consumer Financial Protection Bureau (CFPB) oversees products and services to ensure that consumers have the necessary information to make informed financial decisions, that prices are transparent and risks are clearly communicated, and that there is no important information hidden in fine print. In other words, the CFPB aims to protect consumers by guaranteeing that they have access to clear and complete information about financial products and services.

The statement is false because it is illegal to decline a loan applicant solely based on the fact that they are receiving public assistance. Discrimination based on someone's source of income is prohibited by fair lending laws. Loan decisions should be based on the applicant's ability to repay the loan, creditworthiness, and other relevant factors, rather than their participation in public assistance programs.

The Fair Debt Collection Practices Act (FDCPA) is a federal law that protects consumers from abusive and deceptive debt collection practices. It sets guidelines for how debt collectors can communicate with customers and prohibits them from using unfair or deceptive tactics. Therefore, it is true that the FDCPA prohibits debt collectors from using abusive, unfair, or deceptive practices to collect from customers.

The given statement suggests that in addition to providing TILA boxes on every loan agreement, Check City also displays the terms, rates, and APR on signs in their lobby and on their website. This indicates that Check City is transparent about the terms and conditions of their loans and ensures that customers have access to this information. Therefore, the statement is true.

The correct answer is 36%. The Military Lending Act provides an interest cap of 36%, meaning that lenders cannot charge military personnel interest rates higher than 36% on certain types of loans. This legislation was put in place to protect military members from predatory lending practices and excessive interest rates. By capping the interest rate at 36%, it ensures that military personnel are not burdened with unmanageable debt and can maintain their financial well-being.

The Fair Credit Reporting Act (FCRA) is indeed a set of laws that protect the information collected by consumer reporting agencies. These agencies, such as CoreLogic/Teletrack, CL Verify, Experian, TransUnion, and Equifax, gather data that is used for credit evaluation purposes. Therefore, the statement "True" accurately reflects this relationship between the FCRA and consumer reporting agencies.

The correct answer is "Electronic Fund Transfer Act." EFTA is a federal law that establishes the rights and liabilities of consumers when they engage in electronic fund transfers, such as using ATMs or making purchases with debit cards. It sets guidelines for financial institutions and requires them to disclose certain information to consumers, such as fees and error resolution procedures. The purpose of EFTA is to protect consumers and promote the efficiency and integrity of electronic fund transfers.

The statement "Check City DOES lend to active members of the military" is false. This means that Check City does not provide loans to active members of the military.

If a customer sets up recurring payments on their past due balance with a debit card, it is indeed required to send the customer a written notice of their payment schedule. This notice must include the dates on which the payments will be made and the corresponding amounts. This ensures transparency and allows the customer to keep track of their payments and plan accordingly.

Adverse Action refers to the action taken by a lender or creditor when they deny credit to a customer. It is a legal term used to describe the decision made by the lender based on the customer's creditworthiness. Therefore, the statement that "Adverse Action simply means the customer has been denied credit" is true.

When a consumer's loan application is denied by Check City, the company is obligated to provide the customer with an Adverse Action Notice. This document informs the consumer of the specific reasons why their application was denied and provides them with information on how to request a free copy of their credit report. Additionally, the Privacy Policy is also provided to ensure that the customer understands how their personal information will be handled and protected by Check City.

The correct answer is The Consumer Financial Protection Bureau (CFPB). The Dodd-Frank and Consumer Protection Act established this federal agency to regulate and enforce consumer financial laws. The CFPB's main goal is to protect consumers by promoting fair and transparent practices in the financial industry. It oversees various financial institutions, such as banks, credit unions, and mortgage lenders, ensuring they comply with regulations and treat consumers fairly. The agency also provides educational resources and handles consumer complaints related to financial products and services.

Paying off a payday loan early with a money order is not an example of an Electronic Funds Transfer because it involves the use of a physical money order instead of an electronic transfer of funds. Electronic Funds Transfer refers to the electronic movement of money from one account to another, such as making a payment through a remote banking program, sending a wire transfer, or using a debit card for a purchase.

The Red Flag Rule is a regulation that requires organizations to have measures in place to detect, prevent, and mitigate identity theft. This includes implementing a written Identity Theft Prevention Program. This program should outline the steps the organization will take to identify and respond to potential red flags or warning signs of identity theft. It should also include procedures for verifying the identity of customers and detecting suspicious activities. By having an Identity Theft Prevention Program, organizations can effectively protect their customers' personal information and prevent identity theft.

Pretexting is a form of social engineering where an attacker deceives someone into providing sensitive information or performing certain actions. It typically involves the attacker impersonating someone else or creating a false identity to gain the target's trust. In this scenario, pretexting would involve the attacker texting the individual and using a false pretense to trick them into sending money. However, the statement suggests that pretexting occurs when someone texts another person and asks for money, which is not an accurate description of pretexting. Therefore, the correct answer is False.

False. According to the Fair Credit Reporting Act (FCRA), if a customer is denied credit based on information from a credit report, they have the right to know the specific reasons for the denial, including their credit score. The adverse action notice must include the credit score used in the decision-making process, as well as the name and contact information of the credit reporting agency that provided the report. Failure to provide this information would be a violation of the FCRA.

The explanation for the correct answer is that the Truth-in-Lending Act (TILA) requires that the customer receive information about the loan terms and cost of a credit transaction as an Annual Percentage Rate (APR), not a Weekly Percentage Rate (WPR). The APR is a standardized way of expressing the cost of credit over a year, making it easier for consumers to compare different loan offers.

The advertisement would be a violation under the Unfair Deceptive Abusive Acts or Practices (UDAAP) rules because it is likely to deceive or mislead consumers. UDAAP prohibits financial institutions from engaging in any unfair, deceptive, or abusive practices that may harm consumers. The advertisement may contain false or misleading information, making it a violation of UDAAP. The Bank Secrecy Act (BSA) is related to anti-money laundering regulations, the Military Lending Act (MLA) protects military personnel from predatory lending practices, and the Federal Truth and Advertising Commission (FTAC) does not exist.

Money laundering does not expose the source of illegal proceeds. In fact, money laundering is the process of making illegally obtained money appear legal by hiding its true source. It involves various methods such as layering, where the money is moved through different accounts and transactions to make it difficult to trace back to its origin. The purpose of money laundering is to make the illicit funds appear legitimate, making it harder for law enforcement agencies to track and seize them. Therefore, the correct answer is false.

The FTC's goal is to PROTECT consumers from fraud, deception and unfair business practices in the marketplace.