Practice Free CFE Fraud Prevention and Deterrence Exam Online Questions
Based on research regarding the criminogenic nature of organizations, employees with strong personal values and ethics will always disobey a superior’s direct order to engage in fraudulent behavior, despite an inherent desire to obey authority figures.
- A . True
- B . Flase
Which of the following is LEAST LIKELY to be a factor that directors and management should consider when developing a corporate governance framework for an organization?
- A . The organization’s cultural environment
- B . The organization’s legal and regulatory environment
- C . The organization’s physical operating environment
- D . The organization’s ethical environment
Armando has been tasked with developing policies to help prevent crime by using the threat of criminal sanctions to control the immediate behavior of individuals.
Which of the following strategies to control crime is Armando using?
- A . Deterrence
- B . Enforcement
- C . Prevention
- D . Compliance
Which of the following statements is FALSE regarding an organization’s fraud risk management program?
- A . The program must include mechanisms to address breaches in compliance.
- B . The punishment for intentional noncompliance should be carried out in a consistent and firm manner.
- C . Formal sanctions for intentional noncompliance should be determined and enacted privately
- D . A specific individual or team should be designated as responsible for monitoring compliance with the program
According to ACFE research, which of the following is TRUE regarding prosecutions of white-collar criminals?
- A . The most common internal response to a substantiated fraud case is to terminate the employee.
- B . Only a small percentage of perpetrators are punished when an organization handles a fraud case internally.
- C . Most fraud cases are only handled internally and are not referred to law enforcement for prosecution.
- D . The primary reason that organizations decline to prosecute fraud cases is a lack of evidence.
According to modern criminological studies, which of the following is the determinant aspect of white-collar crime?
- A . Cultural ties
- B . Criminal history
- C . Organizational opportunity
- D . Social class
Joanna is leading the fraud risk assessment process for her organization.
Which of the following considerations about the fraud risk assessment process is MOST ACCURATE and should be incorporated into Joanna’s plans?
- A . To ensure the independence of the team members, a consultant or another external party must conduct the fraud risk assessment.
- B . If the individuals conducting the fraud risk assessment believe that fraud could not happen within the organization, then the assessment process should reflect that belief.
- C . The fraud risk assessment can be conducted effectively by people inside or outside of the organization.
- D . The fraud risk assessment is most effective when management’s influence on the process is limited.
During a fraud risk assessment, a focus group would be MOST HELPFUL in which of the following situations?
- A . The assessment team would like to provide a means for anonymous employee suggestions or responses to questions posed.
- B . The assessment team would like to observe the interactions of several employees discussing the organization’s current fraud awareness training.
- C . The assessment team would like to obtain individuals’ responses through a formal electronic questionnaire.
- D . The assessment team would like to get candid one-on-one feedback from employees in a private
setting.
According to ACFE research, which of the following is TRUE?
- A . Frauds committed by staff-level employees cause higher median losses than those committed by owners and executives.
- B . Men and women commit similar amounts of occupational frauds.
- C . Complaints about family problems is the most reported behavioral red flag displayed by fraud perpetrators.
- D . Most employees who commit occupational fraud are first-time offenders.
Which of the following is one of the four recommendations made by the National Commission on Fraudulent Financial Reporting (the Treadway Commission) to reduce the probability of fraud in financial reports?
- A . Assign oversight of the hotline reporting program to company shareholders
- B . Have a mandatory independent finance committee
- C . Provide adequate resources and authority to the internal audit function
- D . Develop a written charter for the audit committee