American Bankers Association Exam CRCM Topic 1 Question 103 Discussion

Actual exam question for American Bankers Association's CRCM exam

Question #: 103
Topic #: 1

First National Bank advises Country A, a boycotting country, on various U.S. investments. Country A instructs First National Bank not to recommend for investment any shares of certain blacklisted companies. First National Bank follows this instruction. Has First National Bank participated or cooperated in an international boycott under the IRS regulations by this action?

AYes. The companies are the subject of a boycott.

BNo. The bank may agree not to recommend certain companies.

CYes, if the companies are part of a boycott.

DNo, but the bank must report this action to the IRS.

Show Suggested Answer

Suggested Answer: B

by Dierdre at Nov 13, 2024, 09:24 AM

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Audrie

2 days ago

Haha, this question is a real head-scratcher! I'm going to go with D. The bank should report this to the IRS, just to cover their bases. You never know when the tax man might come knocking.

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Shawnee

7 days ago

But the companies are blacklisted, so it does seem like a boycott.

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Quentin

11 days ago

I disagree, the bank is just following Country A's instructions.

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Jimmie

18 days ago

Hmm, I'm not so sure. I think C is the correct answer. If the companies are part of an international boycott, then the bank is cooperating in that boycott by following the instructions. Seems like a gray area to me.

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Shawnee

21 days ago

I think the bank has participated in a boycott.

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Rebeca

23 days ago

I think the answer is B. The bank has the right to decide which companies to recommend, even if it's based on a boycott. As long as they aren't actively participating in the boycott, they're in the clear.

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