CRCM UPDATED Exam Questions and
CORRECT Answers
Which of the following is not exempt from the rules on reasonable and proportional pricing of
electronic debit transactions? - CORRECT ANSWER - A debit card issued by a
community bank with $7 billion in assets, affiliated with another depository institution with
assets of $5 billion
Which of the following statements is true regarding debt card interchange fees and routing? -
CORRECT ANSWER - An issuer can meet the requirements of the network exclusivity
rule by allowing transactions to be processed on two unaffiliated payment card networks that
don't restrict transactions based on geography, merchant or transaction type.
In order to qualify for the fraud prevention adjustment an issuer must (debt card interchange fees
and routing): - CORRECT ANSWER - Implement fraud prevention and detection policies
ABC Bank has several customers with hearing disabilities. Of the following, which statement is
true? - CORRECT ANSWER - The bank must reasonably provide auxiliary aids and
services to assist in communications with its disabled customers
Which of the following activities is permitted under ADA? - CORRECT ANSWER -
Prohibiting smoking anywhere in the bank building - The bank cannot discriminate against
persons who regularly associate with persons with disabilities. It also cannot charge for auxiliary
devices that are used as a reasonable accommodation. Therefore, it cannot charge for the readers.
The bank may not force a disabled person to use a segregated service, such as a special teller
window. If the disabled person wants to use the regular window, the bank must allow him or her
to do so. The bank may prohibit smoking within the building.
Bank A offers safe deposit services in a vault area that contains a door too narrow for wheelchair
passage. The bank cannot widen the door because of the vault construction. Therefore, when a
customer in a wheelchair needs access to a safe deposit box the customer cannot enter the vault.
The bank provides viewing rooms for all safe deposit customers, and one of these rooms has a
door wide enough for a disabled customer to enter. Which of the following must the bank do to
provide safe deposit box service to wheelchair customers? - CORRECT ANSWER - Bring
the safe deposit box to the customer and provide an accessible area where the customer may
,privately have access to the contents - The bank must make this service available in a manner
that provides equal benefits. Because a nondisabled person would not have to be accompanied by
another individual, the bank cannot require this of a disabled person. Also, the construction of a
new vault is a significantly expensive undertaking, one that would probably impose an undue
burden on the bank. The best alternative is to provide the disabled person with access to a private
location and have bank personnel retrieve and deliver the box.
The mortgage lending department of Bank XYZ received some inquiries from potential
applicants who are visually impaired. The bank would like to comply with ADA concerning
these potential applicants, but it does not want to spend a significant amount of money. Which of
the following statements is true? - CORRECT ANSWER - The bank may have a loan
assistant read each loan application and disclosure document to the applicant and assist in
completion of the forms. - Although the bank may have its documents translated into Braille, it is
not required to do so. The bank cannot require that the applicant bring a nondisabled friend, and
it cannot make a policy that blatantly discriminates against a class of disabled persons.
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? - CORRECT ANSWER - Yes. Because the
manager has associated Bob with this disease, the ''associated with'' rule applies
Which of the following employment practices is NOT legal under ADA? - CORRECT
ANSWER - Establishing a policy that prohibits hiring alcoholic applicants - The bank may
establish a policy that prohibits hiring applicants (or permits the firing of employees) who are
under the influence of alcohol while at work. Because alcoholism is a disability, the bank cannot
have a policy of refusing to hire such persons. However, the bank may hold the employee to the
same performance standards and rules, (including those against being under the influence of
alcohol at work) as the other employees.
Under the ADA, what can an employer do? - CORRECT ANSWER - Inquire about a
disability when offering a job provided the disability is related to the job requirements - The
employer may inquire about a disability that is related to the job function. If necessary, the
employer must provide a reasonable accommodation so that the employee can perform the
necessary job functions.
,Mills Company, Inc., is a manufacturing company with a working capital line of credit from First
National Bank. The credit agreement governing the loan states that Mills cannot obtain
additional unsecured credit without the approval of the bank. Mills believes that such a clause
violates the Bank Holding Company Act's anti-tying clause. Does it? - CORRECT
ANSWER - No, since this clause relates to the soundness of the credit - Banks may not
extend credit, lease or sell property, furnish services, fix, or vary consideration conditioned on
the customer not obtaining credit or services from a bank competitor unless imposed to assure
soundness of the credit.
Roger Jameson is the head of the consumer loan department at First National Bank. He is a
regular participant in a lending committee of a local finance trade association. The committee
meets once a month at a local hotel. After the committee meetings, Roger and several other
committee members who are officers at other banks in town go to a hotel restaurant and talk for a
couple of hours before leaving. During these informal conversations Roger learned that the other
members require the car dealerships in town that sell consumer installment contracts to the banks
to refrain from selling them to local savings and loan associations. Roger believes that this is a
good idea and would like to implement it at First National. Is there a problem with doing so? -
CORRECT ANSWER - Yes. Restricting the dealerships is a restraint of trade. - This
action could be considered both a restraint of trade and a conspiracy to restrain trade.
First National is developing a consumer checking account that can access a line of credit. This is
the first time the bank has ever had such a product, although this type of credit facility has been
popular with other banks in town. To determine what interest rate to charge on this account, an
officer of First National called some of his friends at other local banks offering this type of credit
and asked several questions, including the interest rate charged on this type of account and what
internal factors the banks use to set the rate. After obtaining this information, First National
determines that it could charge approximately 2 percent more than it originally planned. Is there
anything wrong with this course of action? - CORRECT ANSWER - Yes. Communicating
with competitors for purposes of setting prices is wrong. - This scenario is an antitrust price-
setting problem. The bank is blatantly attempting to lessen competition by setting prices based
on the prices of competitors. The whole purpose of the antitrust laws is to prevent this type of
price setting.
First National Bank owns a data processing company that sells financially related data
processing services to various businesses in the community. Daniel Tyler, a loan officer, is
negotiating a loan to a local CPA firm. He would like to make the loan conditional on the CPA
firm's use of the subsidiary data processing firm. May he do so? - CORRECT ANSWER -
, No. It is an illegal tie-in. - No loan can be conditioned on the borrower obtaining services from a
bank subsidiary.
Martha Smith of First National Bank is attempting to close a large commercial loan to a
manufacturing equipment company. In negotiating the interest rate on the loan Martha states that
if the company will move some of its demand accounts to the bank, it could get a lower interest
rate. Is this wrong? - CORRECT ANSWER - No. The bank may condition the loan on the
customer placing a deposit in the bank. - The bank may condition the extension of a loan on the
customer placing a deposit in the bank. Anti-tying provisions stipulate that banks may not extend
credit, lease or sell property, furnish services, fix, or vary consideration conditioned on the
customer obtaining additional credit or service from the bank other than a loan, discount, deposit,
or trust service.
For which of the following business activities must a bank holding company obtain prior
approval of the Federal Reserve Board? - CORRECT ANSWER - Operating an auto club
service
Which of the following activities is NOT a permissible nonbanking activity? - CORRECT
ANSWER - Providing general courier services to the businesses around the bank office -
Courier services may only be provided for banking and other financial records.
Which of the following is NOT a factor considered by the Federal Reserve Board when it
evaluates an application under Regulation Y? - CORRECT ANSWER - The current
nonbanking activities of the applicant. The Fed DOES consider the following: (1) The financial
strength of the applicant, (2) The management strength of the applicant, and (3) The effect of the
transaction on competition.
First National Bancshares, Inc., a bank holding company, filed an application with its Federal
Reserve Bank on March 1 to acquire a subsidiary bank. On March 15 the Federal Reserve Board
asked First National for more information. On April 1 the Federal Reserve Bank received the
completed application and accepted it. On April 5 the Federal Reserve Bank notified First
National of the April 1 acceptance and referred the application to the Federal Reserve Board.
Under the normal rules, by what date must the Federal Reserve Board act on the application? -
CORRECT ANSWER - June 1. The usual time from acceptance is 60 days. However, with
additional notification, the Federal Reserve Board can extend the time up to 91 days from the
date the Federal Reserve Bank accepted the application.
CORRECT Answers
Which of the following is not exempt from the rules on reasonable and proportional pricing of
electronic debit transactions? - CORRECT ANSWER - A debit card issued by a
community bank with $7 billion in assets, affiliated with another depository institution with
assets of $5 billion
Which of the following statements is true regarding debt card interchange fees and routing? -
CORRECT ANSWER - An issuer can meet the requirements of the network exclusivity
rule by allowing transactions to be processed on two unaffiliated payment card networks that
don't restrict transactions based on geography, merchant or transaction type.
In order to qualify for the fraud prevention adjustment an issuer must (debt card interchange fees
and routing): - CORRECT ANSWER - Implement fraud prevention and detection policies
ABC Bank has several customers with hearing disabilities. Of the following, which statement is
true? - CORRECT ANSWER - The bank must reasonably provide auxiliary aids and
services to assist in communications with its disabled customers
Which of the following activities is permitted under ADA? - CORRECT ANSWER -
Prohibiting smoking anywhere in the bank building - The bank cannot discriminate against
persons who regularly associate with persons with disabilities. It also cannot charge for auxiliary
devices that are used as a reasonable accommodation. Therefore, it cannot charge for the readers.
The bank may not force a disabled person to use a segregated service, such as a special teller
window. If the disabled person wants to use the regular window, the bank must allow him or her
to do so. The bank may prohibit smoking within the building.
Bank A offers safe deposit services in a vault area that contains a door too narrow for wheelchair
passage. The bank cannot widen the door because of the vault construction. Therefore, when a
customer in a wheelchair needs access to a safe deposit box the customer cannot enter the vault.
The bank provides viewing rooms for all safe deposit customers, and one of these rooms has a
door wide enough for a disabled customer to enter. Which of the following must the bank do to
provide safe deposit box service to wheelchair customers? - CORRECT ANSWER - Bring
the safe deposit box to the customer and provide an accessible area where the customer may
,privately have access to the contents - The bank must make this service available in a manner
that provides equal benefits. Because a nondisabled person would not have to be accompanied by
another individual, the bank cannot require this of a disabled person. Also, the construction of a
new vault is a significantly expensive undertaking, one that would probably impose an undue
burden on the bank. The best alternative is to provide the disabled person with access to a private
location and have bank personnel retrieve and deliver the box.
The mortgage lending department of Bank XYZ received some inquiries from potential
applicants who are visually impaired. The bank would like to comply with ADA concerning
these potential applicants, but it does not want to spend a significant amount of money. Which of
the following statements is true? - CORRECT ANSWER - The bank may have a loan
assistant read each loan application and disclosure document to the applicant and assist in
completion of the forms. - Although the bank may have its documents translated into Braille, it is
not required to do so. The bank cannot require that the applicant bring a nondisabled friend, and
it cannot make a policy that blatantly discriminates against a class of disabled persons.
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? - CORRECT ANSWER - Yes. Because the
manager has associated Bob with this disease, the ''associated with'' rule applies
Which of the following employment practices is NOT legal under ADA? - CORRECT
ANSWER - Establishing a policy that prohibits hiring alcoholic applicants - The bank may
establish a policy that prohibits hiring applicants (or permits the firing of employees) who are
under the influence of alcohol while at work. Because alcoholism is a disability, the bank cannot
have a policy of refusing to hire such persons. However, the bank may hold the employee to the
same performance standards and rules, (including those against being under the influence of
alcohol at work) as the other employees.
Under the ADA, what can an employer do? - CORRECT ANSWER - Inquire about a
disability when offering a job provided the disability is related to the job requirements - The
employer may inquire about a disability that is related to the job function. If necessary, the
employer must provide a reasonable accommodation so that the employee can perform the
necessary job functions.
,Mills Company, Inc., is a manufacturing company with a working capital line of credit from First
National Bank. The credit agreement governing the loan states that Mills cannot obtain
additional unsecured credit without the approval of the bank. Mills believes that such a clause
violates the Bank Holding Company Act's anti-tying clause. Does it? - CORRECT
ANSWER - No, since this clause relates to the soundness of the credit - Banks may not
extend credit, lease or sell property, furnish services, fix, or vary consideration conditioned on
the customer not obtaining credit or services from a bank competitor unless imposed to assure
soundness of the credit.
Roger Jameson is the head of the consumer loan department at First National Bank. He is a
regular participant in a lending committee of a local finance trade association. The committee
meets once a month at a local hotel. After the committee meetings, Roger and several other
committee members who are officers at other banks in town go to a hotel restaurant and talk for a
couple of hours before leaving. During these informal conversations Roger learned that the other
members require the car dealerships in town that sell consumer installment contracts to the banks
to refrain from selling them to local savings and loan associations. Roger believes that this is a
good idea and would like to implement it at First National. Is there a problem with doing so? -
CORRECT ANSWER - Yes. Restricting the dealerships is a restraint of trade. - This
action could be considered both a restraint of trade and a conspiracy to restrain trade.
First National is developing a consumer checking account that can access a line of credit. This is
the first time the bank has ever had such a product, although this type of credit facility has been
popular with other banks in town. To determine what interest rate to charge on this account, an
officer of First National called some of his friends at other local banks offering this type of credit
and asked several questions, including the interest rate charged on this type of account and what
internal factors the banks use to set the rate. After obtaining this information, First National
determines that it could charge approximately 2 percent more than it originally planned. Is there
anything wrong with this course of action? - CORRECT ANSWER - Yes. Communicating
with competitors for purposes of setting prices is wrong. - This scenario is an antitrust price-
setting problem. The bank is blatantly attempting to lessen competition by setting prices based
on the prices of competitors. The whole purpose of the antitrust laws is to prevent this type of
price setting.
First National Bank owns a data processing company that sells financially related data
processing services to various businesses in the community. Daniel Tyler, a loan officer, is
negotiating a loan to a local CPA firm. He would like to make the loan conditional on the CPA
firm's use of the subsidiary data processing firm. May he do so? - CORRECT ANSWER -
, No. It is an illegal tie-in. - No loan can be conditioned on the borrower obtaining services from a
bank subsidiary.
Martha Smith of First National Bank is attempting to close a large commercial loan to a
manufacturing equipment company. In negotiating the interest rate on the loan Martha states that
if the company will move some of its demand accounts to the bank, it could get a lower interest
rate. Is this wrong? - CORRECT ANSWER - No. The bank may condition the loan on the
customer placing a deposit in the bank. - The bank may condition the extension of a loan on the
customer placing a deposit in the bank. Anti-tying provisions stipulate that banks may not extend
credit, lease or sell property, furnish services, fix, or vary consideration conditioned on the
customer obtaining additional credit or service from the bank other than a loan, discount, deposit,
or trust service.
For which of the following business activities must a bank holding company obtain prior
approval of the Federal Reserve Board? - CORRECT ANSWER - Operating an auto club
service
Which of the following activities is NOT a permissible nonbanking activity? - CORRECT
ANSWER - Providing general courier services to the businesses around the bank office -
Courier services may only be provided for banking and other financial records.
Which of the following is NOT a factor considered by the Federal Reserve Board when it
evaluates an application under Regulation Y? - CORRECT ANSWER - The current
nonbanking activities of the applicant. The Fed DOES consider the following: (1) The financial
strength of the applicant, (2) The management strength of the applicant, and (3) The effect of the
transaction on competition.
First National Bancshares, Inc., a bank holding company, filed an application with its Federal
Reserve Bank on March 1 to acquire a subsidiary bank. On March 15 the Federal Reserve Board
asked First National for more information. On April 1 the Federal Reserve Bank received the
completed application and accepted it. On April 5 the Federal Reserve Bank notified First
National of the April 1 acceptance and referred the application to the Federal Reserve Board.
Under the normal rules, by what date must the Federal Reserve Board act on the application? -
CORRECT ANSWER - June 1. The usual time from acceptance is 60 days. However, with
additional notification, the Federal Reserve Board can extend the time up to 91 days from the
date the Federal Reserve Bank accepted the application.
