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    Question

    Which category of operational risk events encompasses

    losses from KYC and guideline breaches?
    A Business disruption and system failure Correct Answer Incorrect Answer
    B Client, product, and business practices Correct Answer Incorrect Answer
    C Execution, delivery and process management Correct Answer Incorrect Answer
    D Internal fraud Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Operational risk is the risk of direct and indirect loss resulting from inadequate or failed internal processes, people, & systems or from external events. KYC and guideline breaches are related to Clients, Products & Business Practices operational risk which means losses arising from an unintentional or negligent failure to meet a professional obligation to specific clients (including fiduciary and suitability requirements), or from the nature or design of a product.

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