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ACFE Certified Fraud Examiner (CFE) - Fraud Investigations and Legal Issues Sample Questions:

1. Callie is an employee at Red Incorporated, a private company in a jurisdiction in which the public has the legal right to be free from unreasonable search and seizure by government authorities. Steven, an investigator employed by Red, searches Callie's office and discovers several personal items that other employees have reported missing. Steven seizes the items and gives them to law enforcement. By failing to obtain a search warrant before conducting his search, Steven has violated Callie's rights.

A) False
B) True

2. Which of the following statements is MOST ACCURATE regarding covert operations?

A) Most jurisdictions provide protections for investigators conducting covert operations so that they do not incur reputational, financial, or legal consequences.
B) Covert operations rarely result in irreparable damage to an investigation, even when an investigator fails to plan properly or take appropriate precautions.
C) For best results, fraud examiners should conduct covert operations at the same time that they are pursuing conventional methods of gathering evidence.
D) Although covert operations can be beneficial to an investigation, mistakes made during the investigation can result in physical harm to the investigator.

3. Clara is a fraud examiner investigating a potentially fraudulent misrepresentation made in the sale of a security. Which of the following questions should Clara ask to determine if the misrepresentation was material?

A) " Would a reasonable investor want to know the information to make an informed decision? "
B) " Were potential investors promised guaranteed returns in the misrepresentation? "
C) " Is the person who made the misrepresentation registered as a broker-dealer? "
D) " Did the person who made the representation have authorization to make the statements that are in dispute? "

4. Anne used Will as a confidential informant in her investigation Anne listed information provided by Will in her final report, referring to him using his initials. She paid Will in cash and obtained a receipt for the transaction. Which of Anne ' s methods was NOT considered a best practice when using informants?

A) Referring to Will using his initials
B) Using information provided by Will in her report
C) Using cash to pay Will
D) Obtaining a receipt from Will

5. A fraud examiner contacts a witness for an interview regarding a financial statement fraud case, but the witness responds by saying that they are too busy to be interviewed. It is MOST APPROPRIATE for the fraud examiner to respond by:

A) Mentioning that all of the witness's coworkers have already agreed to be interviewed about the case.
B) Telling the witness that their refusal to be interviewed will be documented in their personnel file.
C) Assuring the witness that the interview will not take a long time and will not be difficult.
D) Offering to conduct the interview after work hours to better accommodate the witness's schedule.

Solutions: