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CIPP-US Valid Test Review, CIPP-US Exam Guide

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IAPP Certified Information Privacy Professional/United States (CIPP/US) Sample Questions (Q49-Q54):

NEW QUESTION # 49
Which statute is considered part of U.S. federal privacy law?

A. The Personal Information Protection and Electronic Documents Act.
B. SB 1386.
C. The e-Privacy Directive.
D. The Fair Credit Reporting Act.

Answer: D

Explanation:
The Fair Credit Reporting Act (FCRA) is considered part of U.S. federal privacy law because it regulates the collection, use, and disclosure of personal information by consumer reporting agencies, such as credit bureaus, background check companies, and tenant screening services. The FCRA aims to protect the privacy, accuracy, and fairness of consumer credit information, and to ensure that consumers have access to and control over their own credit reports. The FCRA also imposes obligations on users and furnishers of consumer reports, such as creditors, employers, insurers, and landlords, to obtain consent, provide notice, and correct errors when using consumer reports for various purposes. The FCRA is enforced by the Federal Trade Commission (FTC) and other federal agencies, as well as by private lawsuits and state attorneys general. The FCRA was enacted in 1970 and has been amended several times, most notably by the Fair and Accurate Credit Transactions Act of 2003 (FACTA), which added provisions on identity theft prevention, fraud alerts, free credit reports, and disposal of consumer information. References:
* Fair Credit Reporting Act - Wikipedia
* Fair Credit Reporting Act | Federal Trade Commission
* Fair Credit Reporting Act (FCRA) - Consumer Information
* Fair Credit Reporting Act (FCRA) | Privacy Rights Clearinghouse

NEW QUESTION # 50
What type of material is exempt from an individual's right to disclosure under the Privacy Act?

A. Material used to determine potential collaboration with foreign governments in negotiation of trade deals.
B. Material requires by statute to be maintained and used solely for research purposes.
C. Material reporting investigative efforts to prevent unlawful persecution of an individual.
D. Material reporting investigative efforts pertaining to the enforcement of criminal law.

Answer: D

Explanation:
The Privacy Act allows agencies to exempt certain records from some of its provisions, including the right to disclosure, if the records fall within one of the categories specified in subsections (j) or (k) of the Act. One of these categories is records maintained by an agency or component thereof which performs as its principal function any activity pertaining to the enforcement of criminal laws, including police efforts to prevent, control, or reduce crime or to apprehend criminals, and the activities of prosecutors, courts, correctional, probation, pardon, or parole authorities, and which consists of (A) informationcompiled for the purpose of identifying individual criminal offenders and alleged offenders and consisting only of identifying data and notations of arrests, the nature and disposition of criminal charges, sentencing, confinement, release, and parole and probation status; (B) information compiled for the purpose of a criminal investigation, including reports of informants and investigators, and associated with an identifiable individual; or reports identifiable to an individual compiled at any stage of the process of enforcement of the criminal laws from arrest or indictment through release from supervision. 5 U.S.C. § 552a (j) (2). Therefore, material reporting investigative efforts pertaining to the enforcement of criminal law falls within this category and can be exempted from the right to disclosure under the Privacy Act. References:
* Overview of the Privacy Act: 2020 Edition, Ten Exemptions, subsection (j) (2).
* Privacy Act Exemptions, subsection (j) (2).
* IAPP CIPP/US Study Guide, page 66.

NEW QUESTION # 51
Which venture would be subject to the requirements of Section 5 of the Federal Trade Commission Act?

A. A city bus system's frequent rider program
B. An online merchant's free shipping offer
C. A national bank's no-fee checking promotion
D. A local nonprofit charity's fundraiser

Answer: B

Explanation:
Section 5 of the Federal Trade Commission Act (FTC Act) prohibits "unfair or deceptive acts or practices in or affecting commerce." This prohibition applies to all persons engaged in commerce, including banks, but also exempts some entities, such as nonprofit organizations and common carriers, from FTC jurisdiction. Therefore, among the four options, only an online merchant's free shipping offer would be subject to the requirements of Section 5, as it involves a commercial activity that could potentially mislead or harm consumers. For example, if the online merchant fails to disclose the terms and conditions of the offer, or charges hidden fees, or delivers the products late or damaged, it could violate Section 5 by engaging in a deceptive practice.

NEW QUESTION # 52
Which was NOT one of the five priority areas listed by the Federal Trade Commission in its 2012 report, "Protecting Consumer Privacy in an Era of Rapid Change: Recommendations for Businesses and Policymakers"?

A. Do Not Track
B. Large platform providers
C. Promoting enforceable self-regulatory codes
D. International data transfers

Answer: D

NEW QUESTION # 53
Which of the following is NOT one of three broad categories of products offered by data brokers, as identified by the U.S. Federal Trade Commission (FTC)?

A. Research (such as information for understanding consumer trends).
B. Marketing (such as appending data to customer information that a marketing company already has).
C. Location of individuals (such as identifying an individual from partial information).
D. Risk mitigation (such as information that may reduce the risk of fraud).

Answer: C

Explanation:
Data brokers are companies that collect, analyze, and share personal information about consumers for various purposes, such as marketing, risk mitigation, and research. The U.S. Federal Trade Commission (FTC) conducted a study of nine data brokers in 2012 and published a report in 2014, titled "Data Brokers: A Call for Transparency and Accountability". In the report, the FTC identified three broad categories of products offered by data brokers, based on the primary purposes for which the products are used by their customers. The three categories are: 12
* Marketing products: These products help customers target potential customers, tailor marketing offers, measure the effectiveness of marketing campaigns, and improve customer relationships. Marketing products include data elements, segments, scores, lists, and analytics that are derived from consumer data. Data brokers may provide marketing products through direct marketing (such as postal mail,
* e-mail, or phone), online marketing (such as online display ads, social media, or mobile apps), or marketing analytics (such as measuring consumer behavior, preferences, and trends)12
* Risk mitigation products: These products help customers verify and authenticate consumers' identities, prevent fraud, and comply with legal obligations. Risk mitigation products include identity verification, identity authentication, fraud prevention, and compliance products that are based on consumer data. Data brokers may provide risk mitigation products through various methods, such as matching consumer-providedinformation with data broker records, generating questions or challenges based on consumer data, or providing scores or indicators of fraud risk or compliance status12
* Research products: These products help customers understand consumer behavior, preferences, and trends, as well as market conditions, industry developments, and economic factors. Research products include reports, studies, statistics, and insights that are derived from consumer data. Data brokers may provide research products through various formats, such as online portals, dashboards, newsletters, or custom reports12 The FTC report did not include location of individuals as one of the three broad categories of products offered by data brokers. Location of individuals may be a specific type of product or service that some data brokers provide, but it is not a primary purpose for which data brokers use consumer data. Therefore, the correct answer is C. Location of individuals (such as identifying an individual from partial information).
References:
* Data Brokers: A Call For Transparency and Accountability: A Report of the Federal Trade Commission (May 2014)
* IAPP CIPP/US Certified Information Privacy Professional Study Guide, Chapter 5: State Privacy Laws, Section 5.3: Data Broker Laws

NEW QUESTION # 54
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