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Reg CC Flashcards

(60 cards)

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1
Q

How many subparts are included in Reg cc

A

4
Subpart A,B,C and D

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2
Q

What does Subpart A cover?

A

Authority and purpose
Definitions

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3
Q

What does Subpart B cover?

A
  • funds availability and disclosure requirements
  • joint jurisdiction with consumer financial protection bureau (CFPB)
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4
Q

What does Subpart C cover?

A

Definition of electronic checks/electronic returns checks

Check collection

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5
Q

What does Subpart D cover?

A

Substitute Checks and Consumer awareness (Check 21)

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6
Q

Is Reg CC Federal or State?

A

Federal

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7
Q

What is the reconverting bank?

A

Bank that creates the substitute check (takes electronic image and makes it into a paper check-substitute check)

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8
Q

What is the truncating bank?

A

Bank that removes the original check from the collection process (first bank transfers, presents or returns a substitute check in lieu or original check

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9
Q

What is a depositary bank?

A

First bank to which a check is transferred aka BOFD (bank of first deposit) may also be paying bank

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10
Q

What is a returning bank?

A

Bank handling a returned check or notice (will not be paying to depositary bank

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11
Q

Does Reg CC cover savings accounts?

A

No, Reg CC for checking amounts (DDA account)

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12
Q

What is the term ‘bank’ used to refer to generically?

A

A bank, credit union, savings association, etc. or financial institutions

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13
Q

What is the role of a Collecting Bank?

A

Any bank handling a check for forward collection, except the Paying Bank

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14
Q

What is a Depositary Bank?

A

The first bank to which a check is transferred, also known as Bank of First Deposit (BOFD)

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15
Q

Fill in the blank: A _______ is defined as any bank handling a check for forward collection, except the Paying Bank.

A

Collecting Bank

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16
Q

What does BOFD stand for?

A

Bank of First Deposit

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17
Q

True or False: A Depositary Bank can also be referred to as the Paying Bank.

A

True

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18
Q

What is a Paying Bank?

A

The bank that pays the check upon presentation

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19
Q

What is a checking (deposit) account?

A

A deposit account at a bank from which the account holder makes transfers or withdrawals by negotiable instrument or other similar means to make payments or transfer funds to third persons.

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20
Q

What does ‘availability’ refer to?

A

The time from the day of deposit until funds are available for withdrawal or other use.

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21
Q

Fill in the blank: Funds deposited in a checking account are available for _______.

A

[withdrawal or other use]

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22
Q

True or False: A checking account allows for transfers or withdrawals only through cash transactions.

A

False

Transfers or withdrawals can be made through negotiable instruments or similar means.

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23
Q

What is a common abbreviation for a checking account?

A

DDA

DDA stands for Demand Deposit Account.

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24
Q

What is the significance of the bank’s office hours in relation to a checking account?

A

It indicates when the office of the bank is open to the public for transactions.

This affects when account holders can access their funds or make transactions.

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25
What is a Banking Day?
Business day on which office of bank is open to public for substantially all banking functions ## Footnote This includes services such as deposits, withdrawals, and loan processing.
26
Define Business Day.
Calendar day other than a Saturday or a Sunday, or FRB legal holidays ## Footnote FRB stands for Federal Reserve Bank.
27
Why are banking and business day distinctions important?
Consider timing for returns: Number of days from day of presentment for returns are based on banking vs. business day considerations ## Footnote Understanding these distinctions can affect transaction processing and customer service.
28
Fill in the blank: A _______ is a calendar day other than a Saturday or a Sunday, or FRB legal holidays.
Business Day
29
True or False: A Banking Day is the same as a Business Day.
False ## Footnote A Banking Day specifically refers to when the bank is open for operations.
30
What is a check?
A document that orders a bank to pay a specific amount of money from a person's account. ## Footnote Checks can be used for various transactions, including payments and remittances.
31
What is a negotiable demand draft?
A draft drawn on or payable through a bank. ## Footnote This includes drafts drawn on the Federal Reserve Bank (FRB) or Federal Home Loan Bank (FHLB).
32
What types of drafts are included under demand drafts?
* Drawn on U.S. Treasury * Drawn on a state or unit of general local government, not payable through a bank * U.S. Postal Service money orders * Traveler's checks * An original check and a substitute ## Footnote These instruments are used for various payment purposes.
33
What is an image cash letter?
A standard for transmitting images of checks along with their MICR line data. ## Footnote It includes images of checks and is used for electronic check processing.
34
True or False: A check can only be issued by a bank.
False ## Footnote Individuals and businesses can also issue checks, but they must be drawn on a bank account.
35
What is a Postal Service money order?
A payment instrument issued by the postal service ## Footnote Used for secure transactions without a bank account.
36
What are the types of checks mentioned?
Traveler's check, original check, substitute check ## Footnote Different forms of checks used for transactions.
37
What does the term 'Electronic Check' refer to?
An electronic image and electronic information derived from a paper check ## Footnote Must conform with X9.100-187 standard.
38
What is required for an item to meet the definition of an Electronic Check?
Must have both the image of the item and the MICR line information ## Footnote MICR stands for Magnetic Ink Character Recognition.
39
What does the term 'Electronic Returned Check' imply?
An electronic image and information from a paper check that is returned ## Footnote Sent pursuant to an agreement between sender and Receiving Bank.
40
What are Electronically-Created Items (ECI)?
Check-like items created in electronic form that never existed in paper form ## Footnote These do not meet the definition of an electronic check.
41
True or False: An ECI can create a substitute check.
False ## Footnote ECIs do not meet the definition of electronic checks.
42
Fill in the blank: An electronic check must conform with _______.
X9.100-187 standard ## Footnote This standard outlines the requirements for electronic checks.
43
What does MICR stand for?
Magnetic Ink Character Recognition ## Footnote MICR is used to read and process checks.
44
What types of checks are defined under X9 standards?
* Original check * Substitute check * Electronic check / Electronic returned check ## Footnote These standards include X9.100-160, X9.100-140, and X9.100-187 respectively.
45
What is printed near the bottom of a check in magnetic ink?
Routing number, account number, check number, check amount, and other information ## Footnote This information is crucial for the processing of checks.
46
Fill in the blank: The MICR line is printed in _______.
magnetic ink
47
True or False: The MICR line must comply with ANS standards.
True ## Footnote Compliance with ANS standards ensures consistency in check processing.
48
What is the purpose of the X9.100-187 standard?
For Electrome Check / Electronic Returned Check ## Footnote This standard is specified for subparts C and D.
49
What is the purpose of X9.100-140 standard
For substitute checks
50
What is the purpose for X9-160 (aka X9.13)
For original checks
51
What is printed near the bottom of a check?
Magnetic ink character recognition (MICR) line ## Footnote This includes information in accordance with ANSI standards.
52
What ANS standards apply to the original check?
X9.100-160 (aka X9.13) ## Footnote This standard outlines the requirements for original checks.
53
What ANS standard applies to substitute checks?
X9.100-140 ## Footnote This standard specifies requirements for substitute checks.
54
What ANS standard applies to electronic checks?
X9.100-187 ## Footnote This standard is relevant for electronic checks and electronic returned checks.
55
Is magnetic ink in the MICR line required for all checks?
Yes ## Footnote According to Reg CC, all checks must have routing number in magnetic ink.
56
When is magnetic ink not required for checks?
When an IRD is created for a paid item returned as a property paid item ## Footnote This refers to items returned to the issuing customer's account.
57
What font is used for MICR characters?
E-138 font ## Footnote MICR characters may also be printed in non-magnetic ink according to section 6.1 of X9.100-140.
58
What must a substitute check conform to?
All other requirements of X9.100-140 standard ## Footnote This ensures the substitute check meets necessary specifications.
59
Does a customer need a copy of an already paid item printed in magnetic ink?
No ## Footnote The Clearing House Payments Company states it does not need to be printed in magnetic ink.
60

Ncp (13 decks)

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