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Exam CRCM topic 1 question 30 discussion

Actual exam question from ABA's CRCM
Question #: 30
Topic #: 1
[All CRCM Questions]

Compliance issues related to payday lending are all of the following EXCEPT:

  • A. Payday lending may adversely affect a bank's CRA rating. Any illegal or questionable practices will negatively affect a bank's CRA performance. A payday lending program may be inconsistent with helping to meet the community's credit needs
  • B. The bank (or its third-party partner) must properly disclose all finance charges and fees to payday lending customers. Advertisements of the program are also subject to Truth-in-Lending requirements
  • C. Adverse action disclosures must be provided to applicants of payday loans that are denied if a consumer report (including check tracking services) was used in the credit decision
  • D. The bank may be subject to the FOC's unfair or deceptive practices rules.
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Suggested Answer: D 🗳️

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Dex24
7 months ago
D, page 34
upvoted 1 times
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Cam22
8 months, 3 weeks ago
The correct entity in this context should likely be the FTC (Federal Trade Commission), not the "FOC," as it relates to unfair or deceptive practices. The FTC enforces laws against deceptive or unfair business practices, including in the context of payday lending. Thus, the mention of "FOC" appears to be a typographical or factual error, making option D the correct answer as the exception in the context of compliance issues related to payday lending.
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