Maintaining Privilege in Compliance Self-Testing under Regulation B
Question
A bank may engage in voluntary self-testing and self-correction of its compliance with Regulation B. If the bank takes any appropriate corrective action, the reports, results, analysis, opinions, and conclusions of the self-test will be protected by a privilege. The privilege will be lost if
Answers
Explanations
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A. B. C. D.BC
The question is related to the privilege that protects the results of a voluntary self-test performed by a bank to assess its compliance with Regulation B. Regulation B is a federal law that prohibits lenders from discriminating against applicants based on certain characteristics, such as race, gender, religion, national origin, or age.
According to the question, the privilege protecting the self-test results will be lost if certain conditions are met. Let's review each answer choice to determine which one is correct:
A. Loan and application files or other records related to a credit transaction and information derived from such files and records, even if it has been reorganized and summarized for analysis
This answer choice suggests that the privilege is lost if the bank uses loan and application files or other records related to a credit transaction to conduct the self-test. This is not correct, as the question states that the bank may engage in voluntary self-testing, and the privilege applies to the reports, results, analysis, opinions, and conclusions of the self-test, not to the underlying records.
B. The information is voluntarily disclosed to the government
This answer choice suggests that the privilege is lost if the bank voluntarily discloses the self-test results to the government. This is correct, as the privilege only applies if the bank takes appropriate corrective action and does not voluntarily disclose the results to the government. If the bank does disclose the results to the government, the privilege is waived, and the results may be used as evidence in legal proceedings.
C. The public or is used in any manner as a defense to a discrimination charge
This answer choice suggests that the privilege is lost if the self-test results are used as a defense in a discrimination charge or are made public. This is correct, as the privilege only applies if the self-test results are kept confidential and are not used as a defense in legal proceedings. If the results are made public or used as a defense, the privilege is waived, and the results may be used as evidence in legal proceedings.
D. credit information is furnished in response to inquiries concerning an account reflecting the participation of consumer
This answer choice suggests that the privilege is lost if the bank furnishes credit information in response to inquiries concerning an account reflecting the participation of the consumer. This is not related to the privilege protecting the self-test results, and it is not a condition that would cause the privilege to be lost.
Therefore, the correct answer to the question is B, which states that the privilege protecting the self-test results will be lost if the information is voluntarily disclosed to the government. It is important to note that the privilege only applies if the bank takes appropriate corrective action and keeps the results confidential, and it may be lost if the results are disclosed to the government or used as a defense in legal proceedings.
