Certified Regulatory Compliance Manager (CRCM) — Question 155

The sender agrees to indemnify each Reserve Bank for:

Answer options

• A. Any loss or expense resulting from sender's lack of authority
• B. Any action taken by the Reserve Bank within the scope of its authority in the handling of the item
• C. An electronic item that is not a substitute check is not liable for any amount paid by a Reserve Bank that is attributable to the Reserve Bank's own lack of good faith or failure to exercise ordinary care
• D. Any warranty made by the Reserve Bank under Regulation J, Regulation CC, or the UCC

Correct answer: A, B, D

Explanation

The correct answer is A, as it directly addresses the sender's responsibility for losses due to their own lack of authority. Option B is also correct, but does not relate to indemnification, while C discusses liability issues unrelated to indemnification. Option D pertains to warranties rather than indemnification, making it incorrect in this context.