Preview Questions Compliance Officer | Role Specific Skill

Question 1: How does the Volcker Rule restrict financial institutions in the BFSI sector?

Which action should you take?

Choose only one option

Limits proprietary trading

Prohibits retail banking

Reduces investment in mutual funds

Imposes capital reserve requirements

Question 2: How would you address operational risks arising from inadequate internal controls?

Which action should you take?

Choose only one option

Increase capital reserves

Strengthen internal policies

Outsource key functions

Conduct third-party audits

Question 3: How can financial institutions address deficiencies identified during a regulatory audit?

Which action should you take?

Choose only one option

Develop a corrective action plan

Conduct additional audits

Adjust annual financial statements

Escalate to senior management

Question 4: What is the maximum exposure to market risk a financial institution can take according to Basel III?

Which action should you take?

Choose only one option

There is no explicit limit defined under Basel III

It is fixed at 2% of the institution's total assets

It should be equivalent to 100% of its capital base

It is determined by the institution's internal risk management framework

Question 5: During an investigation of potential bribery or corruption within a bank, what is the most relevant evidence to review?

Which action should you take?

Choose only one option

Staff attendance records and schedules

Internal job performance metrics of employees

Communication records, such as emails or phone records, showing irregular transactions

Records of customer feedback and complaints

Question 6: Which document is required to be filed annually by banks under the Community Reinvestment Act (CRA) to report their lending practices?