Practice Test Geeks(CCM) Certified Credit Manager Practice Test
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Regulatory Compliance & Governance Flashcards

7 cards from real CCM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Regulatory Compliance & Governance flashcards as text

  1. The CFPB's Regulation B (implementing ECOA) requires creditors to retain records of credit applications for how long?

    Answer: 25 months

    Regulation B generally requires creditors to retain records of credit applications and related actions for 25 months (or 12 months for business credit in some cases).

  2. A credit manager's company operates in California and collects personal data from California residents. Under the California Consumer Privacy Act (CCPA), consumers have the right to:

    Answer: Opt out of the sale of their personal information

    The CCPA grants California consumers the right to opt out of the sale of their personal information to third parties.

  3. Under the Dodd-Frank Act's Whistleblower Program, an employee who reports securities violations to the SEC may be entitled to:

    Answer: A monetary award of 10-30% of sanctions exceeding $1 million

    The Dodd-Frank Whistleblower Program provides monetary awards of 10% to 30% of SEC sanctions collected when the sanctions exceed $1 million.

  4. Which of the following best describes the concept of 'piercing the corporate veil' as it relates to credit risk and governance?

    Answer: A legal doctrine allowing creditors to hold individual shareholders personally liable when corporate formalities are ignored

    Piercing the corporate veil is a legal doctrine that allows courts to hold shareholders personally liable for corporate debts when the corporate form has been abused or corporate formalities have been disregarded.

  5. A company's credit policy requires that all credit decisions over $500,000 be approved by a credit committee. This control is an example of:

    Answer: Authorization and approval controls

    Requiring committee approval for large credit decisions is an authorization and approval control that ensures significant risk-taking decisions receive appropriate oversight.

  6. Under the Foreign Corrupt Practices Act (FCPA), which of the following payments to a foreign official is explicitly permitted as an exception?

    Answer: Facilitating payments to expedite routine governmental actions such as processing permits

    The FCPA contains a narrow exception for facilitating or 'grease' payments made to expedite routine governmental actions, such as processing permits, licenses, or visas.

  7. When a company implements a 'three lines of defense' governance model for credit risk, which line is responsible for setting credit risk policy and appetite?

    Answer: Second line — Risk Management and Compliance

    In the three lines of defense model, the second line (Risk Management and Compliance) is responsible for setting risk policies, frameworks, and appetite, while the first line owns the risks day-to-day.