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The CFE-Financial-Transactions-and-Fraud-Schemes certification exam is a computer-based exam that consists of 125 multiple-choice questions. CFE-Financial-Transactions-and-Fraud-Schemes exam is administered at Pearson VUE testing centers worldwide, and candidates have four hours to complete it. CFE-Financial-Transactions-and-Fraud-Schemes exam is challenging, and candidates are required to demonstrate a high level of knowledge in order to pass. However, the ACFE provides a wealth of resources to help candidates prepare, including study materials, online courses, and review courses.
NEW QUESTION # 36
Which of the following is an example of a corruption scheme?
- A. Two coworkers steal confidential information from their employer and use the stolen data to start a competing business.
- B. A public company omits recurring costs from its financial statements to make the company appear more profitable than it is.
- C. A vendor offers the use of a beach house to a government procurement agent for free after the agent awards a contract to the vendor.
- D. A warehouse manager receives twenty laptops in a shipment but excludes five of the laptops from the records so that they can be sold to third parties.
Answer: C
NEW QUESTION # 37
______________ can be detected by closely examining the documentation submitted with the cash receipts.
- A. Approved transaction
- B. Voided purchases
- C. None of the above
- D. Fictitious refunds
Answer: D
NEW QUESTION # 38
Which of the following is FALSE regarding electronic payment tampering?
- A. ACH blocks allow account holders to notify their banks that ACH debits should not be allowed on specific accounts.
- B. The individual who makes electronic payments on behalf of the company should also set ACH filters to ensure that only designated individuals are paid.
- C. Positive pay is recommended for ACH transactions to ensure their legitimacy.
- D. The lack of physical evidence makes electronic payment tampering more difficult to detect than traditional check tampering.
Answer: B
NEW QUESTION # 39
A journal in which all sales made on credit or cash are listed is:
- A. Accounts receivable journal
- B. Disbursement journal
- C. Accounts payable journal
- D. General journal
Answer: A
NEW QUESTION # 40
Which of the following scenarios does NOT describe a card skimming or shimming scheme?
- A. After processing a customer's payment, a server returns with the receipt but keeps the credit or debit card hoping that the customer does not notice.
- B. When paying for a drink at a vending machine, a customer inserts their credit or debit card into a fraudulent device that scans and records their card information.
- C. A gadget attached to an ATM is used to fraudulently scan and record customers' credit or debit card information while a small camera records their PINs.
- D. While processing a payment outside of the customer's view, a retail employee uses a small device to scan and record the customer's credit or debit card information.
Answer: C
Explanation:
Explanation/Reference: https://www.experian.com/blogs/ask-experian/shimming-is-the-latest-credit-card-scam/#:~:text='Shimming'%20is%20an%20update%20on,number%20on%20the%20dark%20web
NEW QUESTION # 41
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. Enlisting a company task force to identify areas most at risk for theft by a competitor
- C. Prohibiting all nonemployees from entering the organization's premises
- D. Strong devices containing sensitive data in specially constructed quiet rooms
Answer: B
Explanation:
Explanation/Reference: https://www.acfe.com/uploadedfiles/acfe_website/content/documents/managing-business-risk.pdf
NEW QUESTION # 42
A particular back surgery contains two basic components (an incision and muscle repair), but it is supposed to be billed using a single procedure code. Heather performs this back surgery on a patient and submits a claim using three codes: one for the full procedure, one for the incision, and one for muscle repair. Which scheme BEST describes Heather's actions?
- A. Unnecessary services
- B. Upcoding
- C. Unbundling
- D. Over-utilization
Answer: B
Explanation:
Explanation/Reference: https://www.acfeinsights.com/acfe-insights/2018/12/12/health-care-fraud-5-common-billing-schemes
NEW QUESTION # 43
In which approach, fraudsters produce whatever financial statements they wish, perhaps using just a typewriter or a personal computer.
- A. Organized accounting
- B. Beating accounting
- C. Playing the accounting
- D. Outside accounting system
Answer: D
NEW QUESTION # 44
Which of the following is true for Red flags associated with fictitious revenues?
- A. Usual growth in the number of days purchase in receivables
- B. Slow growth or usual profitability, when not compared to other companies in the same industry.
- C. A significant volume of sales to entries whose substance and ownership is not known.
- D. A usual surge in purchase by a majority of units within a company, or of purchase recorded by corporate headquarters.
Answer: C
NEW QUESTION # 45
Which of the following is NOT a justifiable reason to depart from generally accepted accounting principles (GAAP)?
- A. The transaction at issue is considered to be immaterial.
- B. Departing from GAAP will make the company appear more profitable.
- C. It is a common industry practice to give particular transactions a specific accounting treatment.
- D. Adherence to GAAP would produce misleading results.
Answer: C
NEW QUESTION # 46
A fraudster poses as the head of one of XYZ Company's foreign suppliers and sends an email to an XYZ employee requesting that this month's payments be made to an alternate account that the fraudster owns. This is an example of which of the following types of fraud schemes?
- A. Executive email attack
- B. Reverse social engineering
- C. Business email compromise
- D. Electronic piggybacking
Answer: D
Explanation:
Explanation/Reference: https://whatis.techtarget.com/definition/piggybacking
NEW QUESTION # 47
By removing a tangible asset from the business (a debit), the books will be ___________ by the exact amount of the tangible asset misappropriated.
- A. False debits
- B. Out-of-balance
- C. None of all
- D. Journal Entries
Answer: B
NEW QUESTION # 48
The act of an official or fiduciary person who unlawfully and wrongfully uses his station or character to procure some benefit, contrary to duty and rights of others is called:
- A. Bribery
- B. Corruption
- C. Overbilling
- D. Conflict of interest
Answer: B
NEW QUESTION # 49
Statistical sampling enables the examiner to predict the occurrence rate for the population and therefore determine with some accuracy the error rate, or the potential for fraud.
- A. False
- B. True
Answer: B
NEW QUESTION # 50
When a victim company purchases unnecessary goods or services from a supplier at the direction of the corrupt employee, this results in:
- A. Need recognition scheme
- B. Presolicitation scheme
- C. Submission scheme
- D. False sole-source scheme
Answer: A
NEW QUESTION # 51
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