Unfair, Deceptive, Or Abusive Acts Or Practices

9 Questions | Total Attempts: 44

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Unfair, Deceptive, Or Abusive Acts Or Practices

Under the Dodd-Frank Act, it is unlawful for any provider of consumer financial products or services or a service provider to engage in any unfair, deceptive or abusive act or practice. So TAKE your time on this one.


Questions and Answers
  • 1. 
    What does UDAAP stand for?
    • A. 

      Unfair, Discrimination, or Abusive Acts or Practices

    • B. 

      Unintended, Discrimination, or Abusive Acts or Prictices

    • C. 

      Unfair, Deceptive or Abusive Acts of Practices

  • 2. 
    Unfair, deceptive, or abusive acts and practices (UDAAPs) can cause significant financial injury to consumers, erode consumer confidence, and undermine the financial marketplace.
    • A. 

      True

    • B. 

      False

  • 3. 
    Under what Act was UDAAP born?
    • A. 

      Truth in Lending Act

    • B. 

      CFPB Act

    • C. 

      Dodd-Frank Act

    • D. 

      FHFA

  • 4. 
    The standard for unfairness in the Dodd-Frank Act is that an act or practice is unfair when: Which one is most correct?
    • A. 

      (1) It causes or is likely to cause substantial injury to consumers;

    • B. 

      (2) The injury is not reasonably avoidable by consumers;

    • C. 

      (3) The injury is not outweighed by countervailing benefits to consumers or to competition

    • D. 

      (4) All of the above

  • 5. 
    A representation, omission, actor practice is deceptive when.... (1) The representation, omission, act, or practice misleads or is likely to mislead the consumer; (2) The consumer’s interpretation of the representation, omission, act, or practice is reasonable under the circumstances; and (3) The misleading representation, omission, act, or practice is material
    • A. 

      True

    • B. 

      False

  • 6. 
    Deception is not limited to situations in which a consumer has already been misled. Instead, an act or practice may be deceptive if it is likely to mislead consumers.
    • A. 

      True

    • B. 

      False

  • 7. 
    The FTC’s “four Ps” test can assist in the evaluation of whether a representation, omission, act, or practice is likely to mislead:
    • A. 

      Is the statement prominent enough for the consumer to notice?

    • B. 

      Is the information presented in an easy-to-understand format that does not contradict other information in the package and at a time when the consumer’s attention is not distracted elsewhere?

    • C. 

      Is the placement of the information in a location where consumers can be expected to look or hear?

    • D. 

      The information in close proximity to the claim it qualifies?

    • E. 

      None of the above

  • 8. 
    The Dodd-Frank Act makes it unlawful for any covered person or service provider to engage in an “abusive act or practice.”15 An abusive act or practice: Materially interferes with the ability of a consumer to understand a term or condition of a consumer financial product or service
    • A. 

      True

    • B. 

      False

  • 9. 
    The Dodd-Frank Act makes it unlawful for any covered person or service provider to engage in an “abusive act or practice.”15 An abusive act or practice: Takes unreasonable advantage of: o A lack of understanding on the part of the consumer of the material risks, costs, or conditions of the product or service; o The inability of the consumer to protect its interests in selecting or using a consumer financial product or service; or o The reasonable reliance by the consumer on a covered person to act in the interests of the consumer.
    • A. 

      True

    • B. 

      False

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