Practice Quiz

Financial Planner

Category - Professional Conduct and Regulation

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When Congress passes a law that affects financial institutions, what is the first thing that happens after the President signs the law?
  1. Regulated institutions make necessary changes to comply with the law
  2. The Federal Reserve drafts regulations to show how the law should be implemented
  3. The American public is invited to comment or make suggestions on the law
  4. The Federal Reserve Banks train examiners on how to evaluate whether financial institutions comply with the law
Explanation
Answer: B - After Congress passes a bill and the President signs it into law, the Federal Reserve takes over. First, the Federal Reserve drafts regulations specifying how the law will be implemented and invites public comment. After that, they consider all public comment and draft final regulations, issuing the regulations to those affected.
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