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Flashcards in RFPA Deck (18):
1

What requests are covered under the Right to Financial Privacy Act?

Requests from agencies of the FEDERAL government regarding information on individuals or small partnerships (5 or fewer individuals) customers.

2

How do banks respond to informal requests for information from a federal government agency?

The bank must require a formal request before complying, either in the form of a subpoena, warrant, or other formal written request.

3

What provision in the written request notifies the Bank that the federal government agency has complied with RFPA?

There must be a certification that the agency has requested the records from the customer previously, and that the customer has not responded or moved for the request to be legally quashed.

4

If the request for information is coming as a result of a grand jury proceeding, does the federal government agency need to comply with RFPA?

No, this is an exception to the rule.

5

A bank received a search warrant from the FBI for financial records relating to a customer. Initially what is the BEST way for the bank to handle the search warrant?

a. Immediately reject it and return it to the FBI
b. Mail a copy of the search warrant with the notice prescribed by the Right to Financial Privacy Act to the customer within 90 days
c. Obtain a written certification from the FBI that it has complied with the Right to Financial Privacy Act
d. Assemble the requested records and mail them to the bank's primary supervisory agency, which will determine whether the records can be released to the FBI

c. Obtain a written certification from the FBI that it has complied with the Right to Financial Privacy Act

If the FBI can give the bank a certificate of compliance with the Right to Financial Privacy Act, the bank can rely on it. This is the easiest way to comply.

6

In order to properly release records on the basis of a customer authorization, which of the following must the bank do?

a. Make sure that statement is signed and notarized
b. Record the statement in the official records of the county where the bank is located
c. State that the customer may revoke the authorization at any time before the records are released
d. Have the statement acknowledged by the government agency requesting the records

c. State that the customer may revoke the authorization at any time before the records are released

7

Which of the following is NOT an acceptable method of obtaining information under the Right to Financial Privacy Act?

a. A request with customer authorization
b. An administrative subpoena
c. An informal letter
d. A search warrant

c. An informal letter

There is no provision for an informal request.

8

A federal government agency may obtain customer financial records from a financial institution immediately if it presents which of the following to the financial institution?

a. Written request
b. Valid search warrant
c. Certified bench warrant
d. IRS administrative letter

b. Valid search warrant

Of the alternatives, a valid search warrant is the only one by which the bank can immediately turn over the records requested.

9

Of the following situations, which situation does NOT qualify as an exception to the Right to Financial Privacy requirements?

a. When the U.S. attorney is seeking customer records pursuant to the Federal Code of Civil Procedure in a case where the customer and the government are parties
b. When the bank believes that an officer has committed a crime against the bank and supplies information to the FDIC
c. When the OCC is conducting an examination of the financial institution
d. When the Federal Trade Commission (FTC) is seeking financial information on a customer as part of a large investigation for which no charges have yet been issued

d. When the Federal Trade Commission (FTC) is seeking financial information on a customer as part of a large investigation for which no charges have yet been issued

Certain exceptions apply to the Right to Financial Privacy Act. The agencies that regulate a financial institution may obtain records in the course of an examination. Anytime a bank insider is suspected of committing a crime against the bank, the provisions of the Right to Financial Privacy Act do not apply. The act also does not apply to requests for information pursuant to the Federal Code of Criminal or Civil Procedure if both the government and the customer are parties to the action.

10

First National Bank requires all its professional and executive customers when opening an account to sign a statement authorizing the release of financial information to government agencies on request. Is this type of authorization effective for purposes of the act?

a. No, such a statement cannot be required as a condition of doing business
b. Yes, with proper disclosures to the customer
c. Yes, if the bank requires the customer to sign a new authorization statement every three months
d. Yes, if the customer is notified within 30 days of each release of records to a government agency

a. No, such a statement cannot be required as a condition of doing business

The law does not allow the bank to require a customer to sign an authorization as a requirement of doing business.

11

If the Department of Homeland Security requests information from a bank for purposes of combating terrorism, which of the following is true?

a. The bank may require a subpoena
b. The bank may inform the customer of the release of information, if asked
c. The bank may request a certificate of compliance with the Right to Financial Privacy Act before providing the information
d. The bank does not have to provide the information until a federal court requires it

c. The bank may request a certificate of compliance with the Right to Financial Privacy Act before providing the information

The bank may require a certificate of compliance, even when the purpose of the request is to prevent terrorism

12

If records are obtained pursuant to a search warrant, when must the government agency notify the customer of its receipt of the customer’s financial records?

a. Within 10 days after serving the search warrant
b. Within 30 days after serving the search warrant
c. Within 60 days after serving the search warrant
d. Within 90 days after serving the search warrant

d. Within 90 days after serving the search warrant

13

In cases of a judicial subpoena, administrative subpoena, and formal written request, how long after mailing the customer notice must the government agency wait before proceeding to obtain the records?

a. 14 days
b. 20 days
c. 30 days
d. 15 days

a. 14 days

14

In order to improve the efficiency and effectiveness of its Right to Financial Privacy Act compliance program, what should a bank do FIRST?

a. Centralize the receipt and handling of all government agency requests for customer records with a designated officer
b. Include in the bank's loan application an authorization for customers to sign, giving the bank permission to disclose financial records to government agencies as needed
c. Simplify the bank's handling process by adopting a policy that the bank will accept only judicial subpoenas for customer financial records
d. Create an ongoing training program on the Right to Financial Privacy Act for all bank officers and employees

a. Centralize the receipt and handling of all government agency requests for customer records with a designated officer

The bank should also implement a training program, but centralizing the requests is the best way to make the compliance program effective and efficient. Having all customers sign an authorization would not be effective in the long term.

15

The Veterans Administration requested some information from First National Bank regarding a customer’s loan records. The VA provided the bank with a customer authorization form signed by the customer on March 1. The authorization gave the VA the right to review loan records only from March 1 until June 30. The VA requested records on March 15, April 17, May 22, and June 12. The bank complied with each request and supplied the records. Has the bank complied with the Right to Financial Privacy Act?

a. Yes, provided the records provided relate only to the customer's loans.
b. Yes, provided the customer has the right to revoke the authorization at any time.
c. No, the authorization was for too lengthy a time period.
d. No, the VA is not covered by the law.

c. No, the authorization was for too lengthy a time period.

The customer authorization can authorize disclosure for up to three months only.

16

An officer at First National Bank has reason to believe that one of the bank’s customers may be involved in illegal activities for which funds are regularly deposited into the customer’s account. The officer does not know whether to notify the proper government agency or to notify the customer first. Under the Right to Financial Privacy Act what can the bank do?

a. The bank must notify the government agency, state that it has information concerning a possible violation of law, and provide the name and account number of the person involved.
b. The bank must notify the government agency that a possible crime has been committed and supply the customer's name, but it also must notify the customer at the same time.
c. The bank cannot notify the government agency until it notifies the customer and gives the customer a reasonable period of time to explain the account activity.
d. The bank must notify the government agency and supply all records that support its claim that a law was violated.

a. The bank must notify the government agency, state that it has information concerning a possible violation of law, and provide the name and account number of the person involved.

If the bank believes a crime may have been committed, it must notify the government agency and give only the customer's name and account number and the nature of the suspected activity. It should not notify the customer. The Right to Financial Privacy Act permits such a disclosure, and the suspicious activity reporting (SAR) regulations require it. Under the SAR regulations the customer may not be notified.

17

As a general rule under the Right to Financial Privacy Act, what must be provided to a bank before information can be released to the requesting party?

a. A copy of the customer's driver's license, passport, or other suitable identification
b. The customer's telephone number, so oral authorization to release information can be obtained easily
c. A copy of the customer's written authorization to release information
d. A letter from a government official requesting the information

c. A copy of the customer's written authorization to release information

There are many ways to legally obtain information; however of the alternatives provided, a customer authorization is the best method.

18

According to the Right to Financial Privacy Act, when a call is received from the Social Security Administration requesting verification of whether an individual has an account at an institution in order to prevent a fraud from occurring, what should the employee taking the call do?

a. Refuse to answer because it would be a violation of the Right to Financial Privacy Act
b. Provide full information on the individual's account
c. Confirm the existence of the individual's account, but provide no further information
d. Tell the caller it is necessary to obtain the individual's written permission to provide any information

c. Confirm the existence of the individual's account, but provide no further information

The bank may disclose this information to the Social Security Administration to prevent fraud.