A quality-control reviewer flags a case because a borrower asks whether the company will file a suspicious activity report. What correction is appropriate?
Correct Answer
D) Do not tell the borrower that a SAR may be filed
Why this is correct: The correction must align with the SAR confidentiality requirement. The rule prohibits disclosing SAR filing information to the subject. Therefore, the appropriate action is to ensure no one tells the borrower a SAR may be filed. Why the other choices are wrong: "Treat the rule as waived because all parties want the file to move faster" is wrong because regulatory requirements cannot be waived by mutual agreement. "Assume another jurisdiction approval automatically cures this file" is wrong because SAR rules are federal and not superseded by state or other approvals. "Handle records, reports, and required notices with a sales script rather than the required file action" is wrong because a sales script cannot replace the mandatory legal action of maintaining SAR confidentiality. Exam tip: In quality control, flag any communication that risks SAR confidentiality. The fix is always to stop the disclosure.
Why This Is the Correct Answer
The correct response is "Do not tell the borrower that a SAR may be filed". SAR rules include confidentiality; the borrower should not be tipped off about a SAR filing or potential filing.
Why the Other Options Are Wrong
Option A: Treat the rule as waived because all parties want the file to move faster.
Treat the rule as waived because all parties want the file to move faster. is not correct because it bypasses the rule supported by the explanation.
Option B: Assume another jurisdiction approval automatically cures this file.
Assume another jurisdiction approval automatically cures this file. is not correct because it bypasses the rule supported by the explanation.
Option C: Handle records, reports, and required notices with a sales script rather than the required file action.
Handle records, reports, and required notices with a sales script rather than the required file action. is not correct because it bypasses the rule supported by the explanation.
Memory Technique
For SAR questions, no tipping is almost always the tested ethics point.
Exam Tip
For SAR questions, no tipping is almost always the tested ethics point.
Common Mistakes to Avoid
- -Customer service transparency does not include disclosing SAR activity to the subject.
More Ethics & Fraud Questions
In a closing-readiness check, a disclosure specialist sees facts tied to Appraisal Fraud Detection. What should the file reflect?
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A branch manager asks about a loan file because marketing proposes a rate the company is not prepared to offer. What should happen?
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The loan team is resolving Privacy and Confidentiality during a quality-control sample. Which action best fits the rule?
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Before closing, the team discovers that a loan officer wants different terms because of a protected applicant characteristic. What is the safest compliant answer?
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