The Dodd-Frank Act: O A regulatory bill meant to guard against the irresponsibility that caused the subprime mortgage crisis. OA bill that imposed new, strict, regulations on mortgage companies and investment banks. O An act that dispersed additional funds to aid in the recovery of the troubled financial institutions (Fls) O Created a program that monitors both mortgage issuers and borrowers, preventing unethical and predatory lending. O Does all of the above

The Dodd-Frank Act: O A regulatory bill meant to guard against the irresponsibility that caused the subprime mortgage crisis. OA bill that imposed new, strict, regulations on mortgage companies and investment banks. O An act that dispersed additional funds to aid in the recovery of the troubled financial institutions (Fls) O Created a program that monitors both mortgage issuers and borrowers, preventing unethical and predatory lending. O Does all of the above

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter4: Professional Legal Liability

Section: Chapter Questions

Problem 7RQSC: Refer to the Focus on Fraud feature “Moss Adams and the Meridian Mortgage Funds Fraud.” a. Why was...

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Discuss the advantages and disadvantages of regulatory forbearance in banking. How useful has it been in mitigating COVID-19 stress on banks? Give some examples
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The Sarbanes-Oxley Act was a market response to accounting fraud, and the Dodd-Frank act was a command response to the mortgage crisis. True False
What provisions in the Dodd-Frank Wall Street Reform andConsumer Protection Act are designed to prevent a futurefinancial crisis?
Which of the following is not true regarding the Financial Reform Act of 2010? O It required banks to maintain a stake in the mortgage portfolios that they sell. O It created Volcker Rule which enables and encourages proprietary trading by banks. O It established a Consumer Financial Protection Bureau to regulate consumer finance products and services offered by commercial banks and cther financial institutions. O It set more stringent standarcls for mortgage applicants.
4. Investment bank controversies Which of the following is true regarding the "revolving door" between the investment banking industry and the organizations tasked with regulating and overseeing investment banks? Check all that apply. The "revolving door" only goes one way. That is, former investment bankers often go on to work for government organizations, but government employees do not go on to work for investment banks. The "revolving door" only goes one way. That is, government employees often go on to work for investment banks, but former investment bankers do not go on to work for government organizations. The "revolving door" was largely a problem in the 1960's and does not pose any issues in today's financial industry. The "revolving door" can potentially create conflicts of interest among current and former employees of the investment banking industry.
Consumer credit laws have been implemented over the years to protect consumers against creditor abuses. Match the following consumer credit issues with the appropriate consumer credit law: a. Controls debt collection procedures and practice. b. Prohibits credit discrimination because of race, age, or national origin. c. Establishes the APR and requires the disclosure of all credit-related costs. d. Requires credit contracts to be written in plain English. e. Requires a "rejection letter" or written explanation of any adverse action taken. f. Limits marketing of credit cards to the mailing of application packets and prohibits the mailing of unrequested credit cards. g. Allows payment for defective goods purchased with a credit card to be legally withheld. h. Limits fraudulent card use to $50 payment by the cardholder. i. Ensures that divorced individuals can receive credit. j. Provides annual access to one free credit report from each of the major credit bureaus. k. Reduces credit…
2) To reduce moral hazard problems, banks include restrictive covenants in loan contracts. In order for these restrictive covenants to be effective, banks must also A) monitor and enforce them. B) be willing to rewrite the contract if the borrower cannot comply with the restrictions. C) trust the borrower to do the right thing. D) be prepared to extend the deadline when the borrower needs more time to comply.
Governments require some banks to conduct stress tests of their financial situation. What type of financial regulation is this requirement? A. Disclosure requirements B. Assessment of risk management C. Restrictions on competition D. Consumer protection
To minimize systemic risk in the banking system, which prudential measure has been put in place in the General Banking Law and the Manual of Regulations for Banks to safeguard them from too large a risk exposure to a particular borrower or corporate group?* Reserves Single Borrower's Limit DOSRI (directors, officers, stockholders and their related interests) Limit Equity Investment Limit Loan Loss provisioning
Which of the following was part of the U.S. government’s response to the credit crisis? a) Troubled Asset Relief Program (TARP) b) Housing and Economic Recovery Act c) Homeowners’ Mortgage Guarantee Act d) Troubled Asset Relief Program (TARP) AND Housing and Economic Recovery Act
overturned the section of the Banking Act of 1933 that prohibited commercial banks from selling insurance or performing the functions of investment banks. O The Sarbanes-Oxley Act of 2002 O The Securities and Exchange Act of 1934 O The Financial Services Modernization Act of 1999 O The Securities Act of 1933