Internal Control Questionnaires and Verification Procedures

Qualifications and Training

1. Does the bank’s staffing plan consider its nondeposit investment sales program?

2. Does the bank seek to employ dedicated investment specialists and not platform generalists as sales representatives?

3. Does management have written qualification requirements for outside hires of salespeople and sales program managers?

4. Is a system in place to document background inquiries made about new bank sales employees who have previous securities industry experience to check for a possible disciplinary history?

5. Has a bank officer been assigned responsibility for ensuring that adequate training is provided to bank staff?

6. Does the bank have a formal training program for individuals who:

   1. Make customer referrals for nondeposit products?

   2. Are engaged in retail sales of nondeposit investment products?

   3. Are responsible for supervising people who make referrals and/or who engage in selling?

7. Is this training offered as part of:

   1. Initial training?

   2. Continuing training?

8. Is there a training manual showing the objectives of each initial and subsequent training session?

9. Have lesson plans been developed for in-house programs?

10. Are tellers trained:

    1. To not accept orders or sell nondeposit investment products?

    2. To avoid offering investment advice?

    3. To not make recommendations?

    4. To not discuss the merits of any securities with customers?

11. Does the bank provide training that addresses suitability issues?

12. Does suitability training specifically address customer protection issues associated with the most vulnerable classes of investors who may actually prefer the “no investment risk” aspect of insured bank deposits?

13. Is product training provided to:

    1. Compliance staff?

    2. Audit staff?

14. Does the bank have a formal plan to meet future retail nondeposit investment product sales training needs?

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