Ultimate Guide to the CFE-Financial-Transactions-and-Fraud-Schemes - Latest Dec 04, 2025 Edition Available Now
2025 Updated Verified Pass CFE-Financial-Transactions-and-Fraud-Schemes Exam - Real Questions and Answers
The CFE-Financial-Transactions-and-Fraud-Schemes exam covers a wide range of topics related to financial transactions and fraud schemes, including financial statement fraud, money laundering, bribery and corruption, and cybercrime. CFE-Financial-Transactions-and-Fraud-Schemes exam consists of multiple-choice questions and is designed to assess the candidate's knowledge and skills in identifying and investigating financial fraud.
NEW QUESTION # 79
In Cressey's fraud triangle, its three of the legs are Opportunity, Pressure and
- A. Violation
- B. None of the above
- C. Isolation
- D. Rationalization
Answer: D
NEW QUESTION # 80
Which of the following is TRUE regarding financial reporting practices and accounting frameworks, such as
U.S. generally accepted accounting principles (GAAP) and International Financial Reporting Standards (IFRS)?
- A. Both U.S. GAAP and IFRS are considered to be principle-based accounting frameworks.
- B. Management determines which accounting framework an organization will adhere to for financial reporting.
- C. All organizations must use IFRS as their accounting framework if they conduct business internationally.
- D. Publicly traded companies must adhere to the specific financial reporting practices in their jurisdiction.
Answer: D
Explanation:
Explanation/Reference: https://www.investopedia.com/terms/g/gaap.asp
NEW QUESTION # 81
Which of the following is TRUE regarding pyramid schemes?
- A. None of the above
- B. The goal that participants of pyramid schemes have is to sell worthless products to friends and family
- C. All pyramid organizational structures are illegal
- D. An illegal pyramid scheme is modeled to pay off its earliest investors but not its later investors
Answer: D
NEW QUESTION # 82
Blue borrowed her employer's snowplow for her own snow removal business, which she operates on the side.
Blue only used the snowplow on the weekends or after hours, when her employer was not open for business.
Blue falsified the mileage and usage logs for the snowplow so that no one would know she had been using it.
The snowplow was returned unharmed. Which of the following statements is MOST ACCURATE?
- A. Blue committed larceny of a noncash asset.
- B. Blue did not commit occupational fraud.
- C. Blue committed a fictitious sales scheme.
- D. Blue committed misuse of a noncash asset.
Answer: D
NEW QUESTION # 83
A scheme is classified as a Conflict of interest:
- A. when a purchaser must have some kind of ownership or employment interest in the vendor submitting the purchase.
- B. when a salesman must have some kind of ownership or employment interest in the vendor submitting the sales.
- C. when a dealer must have some kind of dealership interest in the vendor submitting the stock.
- D. when an employee must have some kind of ownership or employment interest in the vendor submitting the invoice.
Answer: D
NEW QUESTION # 84
Fraud in financial statements generally takes the form of _______ assets or revenue and _______ liabilities and expenses.
- A. Overstated; overstated
- B. Understated; understated
- C. Understated; overstated
- D. Overstated; understated
Answer: D
NEW QUESTION # 85
Which of the four basic measures, if properly installed and implemented may help prevent inventory fraud?
- A. prenumbered affiliations, segregation of duties, independent checks and physical safeguards
- B. Proper documentation, segregation of duties, independent checks and inventory control
- C. Proper documentation, physical padding, independent checks and physical safeguards
- D. Proper documentation, segregation of duties, independent checks and physical safeguards
Answer: D
NEW QUESTION # 86
Which of the following method is NOT used to detect conflicts of interest?
- A. Underbillings of assets
- B. Review of vendor ownership files
- C. Tips & Complaints
- D. Interviews with purchasing personnel
Answer: A
NEW QUESTION # 87
To help prevent fraudulent billing schemes, it is recommended that companies combine the purchasing and payment functions.
- A. False
- B. True
Answer: A
Explanation:
Explanation/Reference: https://www.acfe.com/uploadedFiles/ACFE_Website/Content/review/cpf/07-Performance-Schemes.pdf
NEW QUESTION # 88
Any expenses that are incurred but not paid by the end of the year are counted in our records of profit and loss, are called:
- A. Depreciations
- B. Accruals
- C. Expenses
- D. Financial record
Answer: B
NEW QUESTION # 89
Which of the following scenarios is MOST indicative of a loan fraud scheme?
- A. A change order for a large project
- B. No missing documents in the loan file
- C. A draw request for a construction loan
- D. High turnover in the developer's personnel
Answer: A
NEW QUESTION # 90
Natalie, a Certified Fraud Examiner (CFE), is tasked with overseeing cybersecurity protocols for her employer, including identifying potential indicators of intrusion, or unauthorized access, to the organization's computer network. Which of the following could potentially indicate that the organization's network has been accessed or compromised?
- A. The network is transmitting much more data than usual to recipients outside the country in which the organization is located.
- B. When logging into the computer network, employees are reminded to change their log-in passwords before they expire.
- C. Updates to the operating systems of computers on the network are automatically installed to patch vulnerabilities.
- D. Users are being denied access to network files they do not typically use in the normal course of business.
Answer: A
NEW QUESTION # 91
In which phase of competitive bidding process, fraudsters attempt to influence the selection of a contractor by restricting the pool of competitors from whom bids are sought?
- A. Solicitation
- B. False specification
- C. Submission
- D. Need recognition
Answer: A
NEW QUESTION # 92
Which of the following scenarios describes a card skimming or shimming scheme?
- A. After processing a customer's payment, a server returns with the receipt but keeps the payment card hoping that the customer does not notice.
- B. None of the above.
- C. An imitation website is created to deceive users into providing their payment card information.
- D. While processing a payment concealed from the customer's view, a retail employee uses a small device to scan and record the customer's payment card information.
Answer: D
NEW QUESTION # 93
Several people who work in real estate collude to obtain a loan for the construction of a residential building on a property that does not exist. The co-conspirators divide the proceeds among themselves and leave the lender with no collateral to seize when loan payments are not made. Which of the following BEST describes this scheme?
- A. Air loan
- B. Phantom lien
- C. Property flopping
- D. Daisy chain
Answer: A
NEW QUESTION # 94
The principle behind full disclosure is:
- A. Any material deviation from GAAP must be explained to the reader of the financial information.
- B. None of above
- C. Any material deviation from SAS must be explained to the writer oh the financial information.
- D. Any material deviation from GAAP must be explained to writer of the financial information.
Answer: A
NEW QUESTION # 95
Which of the following actions would balance the accounting equation to conceal the misappropriation of cash?
- A. Creating fictitious revenue
- B. Increasing owners' equity
- C. Increasing a liability
- D. Increasing another asset
Answer: D
NEW QUESTION # 96
Which of the following would NOT be considered a conflict of interest?
- A. Ernest hires his brother, John, to provide vending services to his employer's lunch areas, but he does not disclose their relationship.
- B. Robert works for Muir's Printing Services on weekdays and Winsted Cafe on weekends, but he does not tell either employer about the other job.
- C. Jennifer is on the board of directors of two companies that compete in the retail market, but she does not tell either company about her role at the other.
- D. Harriet owns a significant amount of stock in a company she regularly buys her employer's office supplies from, but her employer is unaware of this fact.
Answer: B
NEW QUESTION # 97
Which of the following is the MOST ACCURATE statement about the phases of procurements involving open and free competition among contractors?
- A. In the solicitation phase, the procuring entity identifies its needs and develops the criteria used to award the contract.
- B. In the bid evaluation and award phase, the procuring entity issues the solicitation document.
- C. In the post-award and administration phase, the parties that were contracted perform their contractual obligations.
- D. In the presolicitation phase, prospective contractors prepare and submit their bids.
Answer: D
NEW QUESTION # 98
Which of the following is a reason why prepaid debit and gift card fraud schemes are attractive to fraudsters?
- A. Prepaid cards can only be purchased from financial institutions.
- B. All of the above are reasons why prepaid cards are attractive to fraudsters.
- C. Prepaid cards are difficult for authorities to track after the cards have been purchased and activated for use.
- D. Prepaid cards are often not accepted by online retailers and can only be used in transactions where the cards must be physically present.
Answer: C
Explanation:
Explanation/Reference: https://www.acfe.com/article.aspx?id=4294980869
NEW QUESTION # 99
Which of the following is a recommended activity that organizations should engage in to protect their proprietary information from threats?
- A. Practicing data maximization to limit the information available during a data breach
- B. Prohibiting all nonemployees from entering the organization's premises
- C. Enlisting a company task force to identify areas most at risk for theft by a competitor
- D. Strong devices containing sensitive data in specially constructed quiet rooms
Answer: C
Explanation:
Explanation/Reference: https://www.acfe.com/uploadedfiles/acfe_website/content/documents/managing-business-risk.pdf
NEW QUESTION # 100
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