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Q:
Which of the following is considered a nondischargeable bankruptcy debt?
A. Credit card debts
B. Negligence claims
C. Medical expenses
D. Personal loans
E. Intentional torts
Q:
In a bankruptcy proceeding, which of the following debts will have the highest creditor priority?
A. Government tax claims.
B. Employees who are owed wages earned within 90 days of filing.
C. Consumers who have paid deposits or prepayments for undelivered goods or services up to $1,800 per consumer.
D. Creditors with claims in the ordinary course of business incurred after the bankruptcy was filed.
E. General creditors.
Q:
In a bankruptcy proceeding, which of the following debts will have the lowest priority?
A. Government tax claims.
B. Employees who are owed wages earned within 90 days of filing.
C. Consumers who have paid deposits or prepayments for undelivered goods or services up to $1,800 per consumer.
D. Creditors with claims in the ordinary course of business incurred after the bankruptcy was filed.
E. Creditors with claims that arise from the costs of preserving and administering the debtor's estate.
Q:
The Truth-in-Lending Simplification Act:
A. permits debt collectors to contact third parties but the debt collector may not state that the consumer owes a debt.
B. redefines the necessary items to be included in a finance statement.
C. requires the First Bank of the United States to issue model disclosure forms.
D. requires the imposition of fines for technical breaches of the Act.
E. eliminates statutory penalties for purely technical violations of the Act.
Q:
The Fair Debt Collection Practices Act:
A. forbids class-action suits but permits individual ones against the debt collectors.
B. permits debt collectors to contact third parties; the collectors must disclose that they are pursuing a debt against the consumer but may not disclose the nature or amount of the debt.
C. permits debt collectors to contact third parties; the collectors must disclose that they are pursuing a debt against the consumer and may also disclose the nature or amount of the debt.
D. forbids debt collectors from contacting third parties regardless of the disclosure or nondisclosure of the existence of the consumer's debt.
E. permits debt collectors to contact third parties but the debt collector may not state that the consumer owes a debt.
Q:
_____ refers to the efforts of a debt collector to locate the debtor which may require that the collector contact third parties who know of the debtor's whereabouts.
A. Bright-line rule
B. Judicial restraint
C. Prior restraint
D. Redlining
E. Skip-tracing
Q:
Violations of the FDCPA entitle the debtor to sue the debt collector for:
A. contemptuous damages, plus court costs and attorney's fees.
B. punitive damages, plus court costs and attorney's fees.
C. actual damages, plus court costs and attorney's fees.
D. speculative damages, plus court costs and attorney's fees.
E. nominal damages, plus court costs and attorney's fees.
Q:
Shauna is delinquent on her car loan payment. The debt collector hired by the bank visits Shauna and verbally abuses her using highly offensive language. Shauna is annoyed. However, she has suffered no actual damages. Under the Fair Debt Collection Practices Act, the debt collector:
A. may not be ordered to pay Shauna any money because she suffered no injury.
B. may be ordered to pay up to $1,000 for using obscene language.
C. may be ordered to pay up to $10,000 for having made a house visit.
D. is not liable to Shauna, but the bank that hired the collector is liable to her.
E. is allowed to use intimidatory tactics for habitual offenders.
Q:
The Consumer Financial Protection Bureau applies to:
A. businesses regulated by the Securities and Exchange Commission.
B. Internet service providers.
C. real estate agents and brokers.
D. insurance companies.
E. banks.
Q:
The Federal Truth-in-Lending Act:
A. sets minimum and maximum interest rates for various types of loans.
B. mandates that a financing statement be prepared when credit is extended by a business to a consumer.
C. applies to personal property loans such as car or education loans, but does not apply to real property loans such as a purchase of a house.
D. regulates the advertising used by lenders to attract loan customers.
E. establishes dischargeable debts in cases of bankruptcy.
Q:
The total cost of money to a consumer is called the:
A. annual percentage rate.
B. funding charge rate.
C. commercial charge.
D. service charge.
E. finance charge.
Q:
Which of the following is included in the finance charge?
A. Application fees charged to all applicants for credit.
B. Charges for unanticipated late payments, exceeding a credit limit, or delinquency.
C. Charges imposed by a financial institution for paying items that overdraw an account.
D. Fees charged for participation in a credit plan.
E. Fees for appraisals.
Q:
The Truth-in-Lending Act gives consumers the right to rescind certain transactions for a period of:
A. seven business days from the date of the transaction or from the date that notice of the right to rescind is given, whichever comes first.
B. three business days from the date of the transaction or from the date that notice of the right to rescind is given, whichever comes first.
C. three business days from the date of the transaction or from the date that notice of the right to rescind is given, whichever is later.
D. seven business days from the date of the transaction or from the date that notice of the right to rescind is given, whichever is later.
E. five business days from the date of the transaction or from the date that notice of the right to rescind is given, whichever is later.
Q:
Which of the following is true about the penalties and remedies under the Truth-in-Lending Act?
A. There are no civil penalties for violation of Truth-in-Lending.
B. The criminal liability provisions make creditors liable to debtors for an amount equal to twice the finance charge.
C. Creditors may avoid liability in the event they make an error, provided they notify the debtor within 30 days after discovering the error.
D. If creditors avoid liability in making an error by notifying the debtor within 60 days after discovering and correcting the error, the law allows for corrections in favor of the debtor only.
E. Creditors are, in certain cases, allowed to collect finance charges in excess of those actually disclosed.
Q:
A subprime mortgage refers to a mortgage securing a loan that is issued:
A. to consumers at an interest rate lower than the prime interest rate established by the treasury.
B. on property that cannot pass a reasonable safety inspection.
C. to customers with excellent creditworthiness at a lower than ordinary market rate.
D. to consumers who do not qualify for ordinary market rates due to a lack of creditworthiness.
E. to consumers with excellent creditworthiness at a zero rate of interest.
Q:
If there are violations of the Equal Credit Opportunity Act (ECOA), affected consumers:
A. have the right to file a petition to the president to seek redressal.
B. cannot seek public enforcement by the FTC but have the right to sue under private remedies provided in the Act.
C. have to depend on public enforcement by the FTC as they do not have the right to sue.
D. have the right to sue as well as the right to seek public enforcement by the FTC.
E. have the right to resort to intimidatory tactics against the guilty party.
Q:
The "_____" provisions of the FCRA requires that consumers who are seeking credit for personal, family, or household purposes be informed if their application is denied because of an adverse credit report.
A. server
B. subscriber
C. access
D. content
E. user
Q:
_____ reports refer to reports on a customer's character, general reputation, mode of living, and so on, obtained by personal interviews in the consumer's community.
A. Credit
B. Policy
C. Market research
D. Demographic
E. Investigative consumer
Q:
Investigative consumer reports detailing a consumer's character, general reputation, and mode of living are:
A. allowed under the FCRA without restriction should the consumer apply for credit, insurance, or a job.
B. allowed under the FCRA with three days' advance notice to the consumer should the consumer apply for credit, insurance, or a job.
C. allowed under the FCRA with five days' advance notice to the consumer should the consumer apply for credit, insurance, or a job.
D. expressly prohibited under the FCRA because these are not credit-related issues.
E. expressly prohibited under the FCRA because it violates the right to privacy of the consumer.
Q:
Under the FCRA, an injured consumer may only recover:
A. actual damages, attorney's fees, and in some instances speculative damages.
B. actual damages.
C. punitive damages and the attorney's fees but no actual damages.
D. actual damages, attorney's fees, and in some instances punitive damages.
E. actual damages and the attorney's fees but no punitive damages.
Q:
Which of the following statements holds true for the term "redlining"?
A. It refers to the practice in which real estate brokers guide prospective home buyers toward or away from certain neighborhoods based on their race.
B. It refers to the perceived business practice of a company providing a product or a service to only the high-value or low-cost customers of that product or service.
C. It refers to a way of encouraging white property owners to sell their houses at a loss by implying that racial minorities were moving into their previously racially segregated neighborhood, thus depressing real estate property values.
D. It refers to an organization targeting minority consumers by charging them more than would be charged to a similarly situated majority consumer.
E. It refers to the refusal of an organization to make loans at all in certain areas where property values are low.
Q:
The Fair Credit Reporting Act applies to anyone who prepares or uses a credit report in connection with:
A. opening a bank account.
B. promoting an employee.
C. selling real estate.
D. granting a business license.
E. extending credit.
Q:
Which of the following regulates the consumer credit reporting industry?
A. The Equal Credit Opportunity Act
B. The Fair Credit Reporting Act
C. The Truth-in-Lending Act
D. The Fair Debt Collection Practices Act
E. The Uniform Consumer Leases Act
Q:
Although the Equal Credit Opportunity Act protects each of the following from discrimination, special emphasis is aimed at preventing discrimination regarding:
A. race.
B. age.
C. sex
D. marital status.
E. religion.
Q:
Which of the following prevents discrimination in credit extension based on sex, age, race, religion, national origin, marital status, and receipt of welfare payments?
A. The Federal Trade Commission Act
B. The Fair Credit Reporting Act
C. The Truth-in-Lending Act
D. The Fair Debt Collection Practices Act
E. The Equal Credit Opportunity Act
Q:
Big Prime is a major lender licensed to lend only in Delaware. Big Prime finds that customers in Sussex County perform far below customers in the other counties. Assume that the county which is heavily into farming and low-paying industrial jobs is 25 percent African-American and has a 40 percent population of legal and illegal immigrants. Big Prime finds that while it is profitable overall, it is losing money on the Sussex County loans. Further research reveals that Sussex County is one of the poorest-performing customer bases nationwide and most companies doing business there are losing money. The board of directors decides not to make any more loans in Sussex County. Big Prime is violating provisions of the:
A. Federal Trade Commission.
B. Fair Credit Reporting Act.
C. Truth-in-Lending Act.
D. Fair Debt Collection Practices Act.
E. Equal Credit Opportunity Act.
Q:
Private remedies for violation of the Equal Credit Opportunity Act include:
A. actual and punitive damages up to $10,000.
B. actual and punitive damages up to $10,000 and attorney's fees.
C. actual damages, punitive damages up to $10,000, and attorney's fees and legal costs.
D. attorney's fees and legal costs.
E. actual damages up to $10,000.
Q:
Infro, Inc., is a major lender licensed to lend only in Delaware. Infro tracks the payment history of its customers and finds that customers in Sussex County perform far below customers in the other counties. Assume that the county which is heavily into farming and low-paying industrial jobs is 25 percent African-American and has a 40 percent population of legal and illegal immigrants. Infro finds that while it is profitable overall, it is losing money on the Sussex County loans. Further research reveals that Sussex County is one of the poorest-performing customer bases nationwide and that most companies doing business in the county are losing money. The board of directors decides not to make any more loans in Sussex County. Which of the following is true?
A. Before Infro implements its decision, it must get permission from the FTC to do so.
B. If Infro goes through with its decision, it is engaging in redlining which is illegal.
C. If Infro goes through with its decision, it is engaging in reverse redlining which is illegal.
D. Infro, as a private company, is free to make business decisions that are advantageous to the company and has done nothing wrong.
E. If Infro goes through with its decision, it is engaging in liquorlining which is legal.
Q:
ECNAL Corp. manufactures bicycle parts and equipment. One of their new products, the Slipstream tire, is advertised to be 5 percent faster than the competition due to a new rubber compound used that reduces road drag and friction significantly. After receiving complaints of fraud, the FTC determines that the tire is made from rubber similar to that found in most bicycle tires and it does not, in fact, reduce road drag and friction any more than other tires on the market. The FTC has ordered ECNAL to include in their advertising the truth about the tire materials and their quality and specifically state that the Slipstream tire does not improve speed or performance. The FTC has ordered ENCAL to engage in:
A. corrective advertising.
B. cease and desist advertising.
C. comparative advertising.
D. parody advertising.
E. social advertising.
Q:
In advising advertisers about how it determines deceptive trade practices, the Federal Trade Commission looks at all of the following EXCEPT:
A. the ad in context rather than focusing on certain words in the ad.
B. implied claimsthose that are literally made in the ad.
C. what the ad does not say.
D. whether the claim would be "material."
E. whether the advertiser has sufficient evidence to support the claims in the ad.
Q:
Although the FTC is an independent regulatory agency, the FTC commissioners often reflect the views of:
A. lawmakers of the upper house of Congress.
B. the common public who elected them to their positions.
C. the consumer products companies.
D. the executive head of the Bureau of Consumer Protection.
E. the president who appointed them.
Q:
Upon request by the FTC, the federal courts may assess fines for each of the following EXCEPT:
A. when companies violate the cease and desist order.
B. when companies agree to fines as part of a cease and desist order.
C. when companies knowingly violate a prior FTC order against others.
D. when companies violate a trade regulation rule.
E. when companies agree to fines as part of a consent order.
Q:
The courts may assess fines against those found to have engaged in deceptive advertising upon request from the:
A. Bureau of Consumer Protection only.
B. Bureau of Consumer Protection and/or the Home Department.
C. Bureau of Consumer Protection, the FTC, and the Justice Department.
D. FTC or the Justice Department.
E. FTC and the Home Department.
Q:
The regulatory center for federal consumer protection is the:
A. United States Consumer Product Safety Commission.
B. Bureau of Consumer Protection.
C. Federal Consumer Protection Agency.
D. Bureau of Consumer Trade.
E. Department of Consumer Affairs.
Q:
The national "Do Not Call" list was created by a(n):
A. Congressional statute.
B. FTC trade regulation.
C. executive order.
D. uniform statute established on the state's level.
E. procedural law.
Q:
When the Bureau of Consumer Protection prosecutes a violator for violation of the FTC, the violator is called a(n):
A. respondent.
B. claimant.
C. appellant.
D. plaintiff.
E. pursuer.
Q:
Most cases brought by the Bureau of Consumer Protection are settled using:
A. cease and desist orders.
B. arbitration.
C. mediation.
D. injunction.
E. consent orders.
Q:
Section 5 of the _____ Act prohibits unfair or deceptive acts or trade practices.
A. Equal Credit Opportunity
B. Fair Credit Reporting
C. Truth-in-Lending
D. Fair Debt Collection Practices
E. Federal Trade Commission
Q:
The Federal Food, Drug and Cosmetic Act is administered by the FTC.
Q:
Most of the laws which apply the concepts of privacy protect the individual from being overwhelmed by the intrusive power of the government and other large organizations.
Q:
Under the Right to Financial Privacy Act of 1978, the individual depositor has the right to challenge an agency's legal basis for seeking the financial records.
Q:
In the past, courts have mainly used:
A. statutory law to resolve consumer disputes.
B. constitutional law to resolve consumer disputes.
C. administrative regulations to resolve consumer disputes.
D. principles of common law to resolve consumer disputes.
E. principles of procedural law to resolve consumer disputes.
Q:
The Fair Credit Billing Act limits a customer's liability for a thief's use of a stolen credit card to a maximum of $500.
Q:
With regard to the Magnuson-Moss Warranty Act, under full warranties, a warrantor must replace a defective product within a reasonable time and at no charge, barring the shipping costs.
Q:
In a bankruptcy proceeding against an individual, debts are adjusted under Chapter 13 of the bankruptcy law.
Q:
The trustee in a bankruptcy is elected by the debtor to represent the debtor's estate during the bankruptcy.
Q:
Under bankruptcy laws, certain creditors receive priority over others in the distribution of a debtor's assets.
Q:
Voluntary bankruptcy proceedings are filed by the creditor.
Q:
A debt collector is not required to disclose his/her identity as a debt collector to delinquent customers they call when attempting to collect a legitimate, delinquent debt.
Q:
Congress has specified that the Fair Debt Collection Practices Act preempts any state laws regulating debt collection in an effort to standardize enforcement in the industry.
Q:
In a bankruptcy proceeding against an individual, the individual's property is liquidated under Chapter 7 of the bankruptcy law.
Q:
The Consumer Financial Protection Bureau (CFPB) is run by a director appointed by the president with the advice and consent of the Senate.
Q:
Bankruptcy laws are subject to regulatory interpretation.
Q:
A report containing information solely as to transactions between the consumer and the person making the report is not a "consumer report" covered by the Fair Credit Reporting Act (FCRA).
Q:
The Truth-in-Lending Act covers transactions in which the debtor is a corporation or a business entity,
Q:
Recording fees and taxes are not considered in a loan's finance charge.
Q:
The Fair Debt Collection Practices Act applies only to consumer debt collections.
Q:
The Fair Debt Collection Practices Act exempts attorneys who collect consumer debts on behalf of their clients.
Q:
Using zip codes as a factor in denying credit has been determined to be illegal by the FTC due to possible discrimination that could result.
Q:
Marie is a married woman with a good job. If she applies for credit solely in her own name, the credit company may not deny her individual credit if she is creditworthy, but the credit company is permitted to ask if she is married to maintain a complete file on her.
Q:
The basic penalty for trade practice violations under the FTC Act is a civil fine of not more than $10,000 per violation.
Q:
Industry guides issued by the FTC are formal and legally binding.
Q:
Under the cease and desist order issued by the Bureau of Consumer Protection, a party assents to sign an order which restrains the promotional activity deemed offensive.
Q:
The major duty of the Magnuson-Moss Warranty Act is to require the FTC to issue rules regarding consumer product warranties.
Q:
Trade practice regulation ensures fair competition by preventing those who would deceive consumers from diverting trade from those who compete honestly.
Q:
What contributions did Sarbanes-Oxley Act make in the area of corporate governance?
Q:
What provisions have been made by the Sarbanes-Oxley Act to provide protection for whistleblowers?
Q:
Use and transfer of personal property by individuals in the U.S. is unrestricted.
Q:
Consumer protection laws arise when legislatures define an ambiguous legal boundary between certain types of sellers and buyers in ways that favor buyers.
Q:
The Fair Credit Reporting Act regulates credit reports on both consumers and businesses.
Q:
What are the three different forms of registration that apply to a state's application of blue sky laws?
Q:
What are the primary provisions of the Sarbanes-Oxley Act?
The Sarbanes-Oxley Act served to accomplish five major functions. It
increased the SEC budget significantly.
created the Public Company Accounting Oversight Board.
Q:
State the new or proposed rules issued by the SEC post the revitalization process initiated by the Sarbanes-Oxley Act of 2002.
Q:
Under Sarbanes-Oxley, what types of services are auditing firms prohibited from providing to companies?
Q:
When is the use of nonpublic information not considered a violation of the Security Exchange Act of 1934 provisions?
Q:
What is the difference between Section 18 of the 1934 Act and Sections 11 and 12 of the 1933 Act with regard to liability in case of fraud?
Q:
What are the criminal penalties incorporated by the Congress for violating the Securities Exchange Act of 1934?
Q:
What was the purpose of the Private Securities Litigation Reform Act of 1995? What are some of the provisions of the Act?
Q:
What are the four common exemptions from blue sky laws that have been identified?
Q:
Materiality is one of the several defenses that is recognized by the Securities Act of 1933 and may be used to avoid civil liability. Explain "materiality".