Certified Regulatory Compliance Manager (CRCM) — Question 96

The OCC recommends all but one of the following actions to help prevent a national bank's purchasing or acquiring predatory or abusive loans. Which practice is
NOT recommended?

Answer options

• A. Establish policies on the bank's relationship with third-party brokers and originators
• B. Review loan documentation
• C. Audit the third-party broker
• D. Require the broker to establish a reserve account for legal contingencies

Correct answer: D

Explanation

The correct answer is D, as requiring a reserve account for legal contingencies is not a practice recommended by the OCC. The other options, such as establishing policies, reviewing documentation, and auditing brokers, are proactive measures that can help mitigate the risk of engaging with predatory lending practices.