R8-Pt5-8 Flashcards Preview

REG > R8-Pt5-8 > Flashcards

Flashcards in R8-Pt5-8 Deck (15)
Loading flashcards...

What is considered the biggest change to financial regulation since the Great Depression of the 1930s?

The Dodd-Frank Wall Street Reform Act of 2010


What is the goal of the Volcker Rule?

Banking Institutions maintain healthy capitalization ratios


How does the Volcker Rule limit banking institutions?

Limits banking institutions from owning more than 3% of a hedge fund's total ownership interest

Limits banking institutions from owning interests in hedge funds that exceed 3% of their Tier 1 Capital (Common Stock + Retained Earnings + non-redeemable; non-cumulative Preferred Stock)


What does the Volcker Rule require banking institutions to disclose?

Relationships with hedge funds must be fully disclosed to regulators


What are the 3 Independent Steps that can occur simultaneously in Money Laundering?

- Placement: Putting proceeds of illegal activites into the financial system
- Layering: Move Funds around to make it difficult to follow
- Integration: Movement of Money into Legitimate-Looking Transactions


What is the $ Threshold for All Financial Institutions that will have to file a Report?

-Transactions of more then $10,000


What is a Financial Institution?

- Not only Banks
- Credit Unions
- Pawn Brokers
- Casinos
- Brokerages
- Travel checks, Credit Cards companies


BSA Regulations require Banks to maintain Records for?

- 5 Years at $3,000
- Identifying with: name, adrs, birth date, tax ID


At a Minimum, a Bank's Internal Compliance Program must be?

- Written, Approved by the Board of Directors, & Noted as such board minutes in meetings


What is the Sherman Act?

- Prohibits Restraints of Trade & Monopolies
- Impact on interstate commerce: Fed. law applies


What is Section 1 of the Sherman Act?

- Restraints of Trade:
- Rule of Reason Test: Balance Anti-competitive & Competitive Effects
- Per Se Violations: Inherently illegal & Without Legal Justification
- Horizontal Restraints: Agreements Between Competitors
- Vertical Restraints: Agreements by those at Different Marketing Levels


What is Section 2 of the Sherman Act?

- Monopolies & Attempts to Monopolize

- Illegal Monopoly: Power & Power achieved unfairly


Monoloply power exists when ?

- A Firm has sufficient market power to Control Prices or Exclude Competition
- Market Share of more 70%


What is the Clayton Act?

- Aimed at Anti-competitive Behavior NOT covered by Sherman Act
- Stop activities in their Incipiency


What is the Robinson- Patman Act?

- Amended & Strengthen Section 2 of the Clayton Act that prohibited Price Discrimination

- Only apply to price discrimination of commodities of like grade & quality