CFE-Law Certified Fraud Examiner (CFE) - Law Questions and Answers
Which of the following schemes involves disguising money from illegal nonbusiness sources by recording more income on a business's books than the business actually generates?
Nora, a health care provider b convicted of health care fraud in criminal court After her conviction, the national health agency begins a proceeding to prohibit Nora from seeking reimbursement from government health care programs for five years Which type of administrative penalty is the national health agency seeking?
Aliyah is an employee at Chatham, a publicly traded corporation, and she owns shares of Chatham's stock. Aliyah learns that Chatham is going to publicly announce low earnings, so she sells her shares of Chatham's stock. If her conduct is illegal in the jurisdiction where she works and resides, then what type of crime did Aliyah MOST LIKELY commit?
Leslie, a business owner, submits tax information regarding her company's finances to her country's taxing authority. The taxing authority allows companies to subtract the cost of production from their gross sales to determine the taxable income. To reduce her tax liability, Leslie inflates the costs of production on her tax forms. Which of the following schemes has Leslie MOST LIKELY committed?
Acme Inc. is the debtor in a bankruptcy case that will enable the organization to continue conducting business after the proceeding. Which of the following is one of the preferred approaches to governance and management of the proceeding under the World Bank Principles for Effective Insolvency and Creditor/Debtor Regimes (World Bank Principles)?
Greta is convicted of white-collar crime. However, her sentence is suspended in return for her promise of good behavior. Which of the following BEST describes Greta's sentence?
A custodial arrest occurs when a law enforcement officer informs the suspect of their rights as a criminal defendant
Raj is an employee who works in a jurisdiction that prohibits unreasonable workplace searches and surveillance in areas or items where employees have a reasonable expectation of privacy. In which of the following is Raj MOST LIKELY to have a reasonable expectation of privacy?
Which of the following is a requirement of the European Union's (EU) General Data Protection Regulation (GDPR)?
The________________requires that an employee act solely in the best interest of their employer, free of any serf-dealing, conflicts of interest, or other abuse that results in a personal advantage
Paul is convicted of embezzlement. However, his sentence is suspended in return for his promise of good behavior. Which of the following BEST describes Paul’s sentence?
In most common law jurisdictions, which of the following BEST describes when the duty to preserve evidence begins?
Which of the following statements concerning fact finders in criminal trials in common law jurisdictions is MOST ACCURATE?
Claude stole a large amount of cash from his employer and then deposited the funds into a domestic bank account Next, he wired the illicit funds to a foreign bank account and engaged m several other transactions using foreign accounts to make them difficult to trace Finally, he transferred the funds back to a domestic account and then spent the money. Which of the following actions was the layering stage of Claude's money laundering scheme?
John deliberately understated his income so that he could pay a lesser amount on his tax bill. This is an example of tax avoidance.
IBC Manufacturing is 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. An investigator at IBC searches the desk of Denise an IBC employee and finds illegal narcotics. The investigator seizes the narcotics and turns them over to members of law enforcement. The investigator violated Denises rights by failing to obtain a search warrant before conducting the search
Which of the following statements regarding civil lawsuits in most jurisdictions is CORRECT?
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.
Which of the following is the MOST ACCURATE statement about the litigation privilege in common law jurisdictions?
Which of the following statements concerning examinations of expert witnesses in most inquisitorial jurisdictions is accurate?
Which of the following typically does NOT have to be present for communications between an attorney and the attorney's client to be protected by a legal professional privilege?
The concealment of assets occurs most commonly in which of the following types of fraud schemes?
__________ insurance is a type of insurance under which an insured entity is covered against losses caused by the dishonest or fraudulent acts of its employees.
A business files for bankruptcy with the goal of obtaining relief from creditors so that it can rearrange its financial affairs and continue as a going concern. Which of the following describes this type of bankruptcy proceeding?
Which of the following is a legal element that the government must show to prove a conspiracy claim?
Bob receives a memorandum from his attorney that is protected by a legal professional privilege Bob emails the memorandum to a third party who has no need to know the information in the memorandum Which of the following statements is MOST ACCURATE?
The same customer comes into a casino each day and deposits a large amount of cash into an account but after very little gambling the customer withdraws the funds The casino employees suspect that the customer may be engaged in money laundering activity Assuming that the anti-money laundering (AML) regulations that govern the casino’s activities correspond to the Financial Action Task Force (FATF) Recommendations the casino:
Grant, a fraud examiner is investigating Beatrice for embezzlement on his employer's behalf. During his investigation. Grant learns that Beatrice has cheated on her spouse and he tells several of Beatrice's coworkers about it Beatrice discovers that Grant revealed the unflattering (albeit true) information about her and decides to file a claim of defamation against Grant. Which of the following is the BEST explanation of why Beatrice will not win her defamation case?
Robert, a Certified Fraud Examiner (CFE), wants to ensure that the authenticity of the evidence he collected during his investigation is not compromised. His main objective should be to:
A company files a civil lawsuit against one of its directors for insider trading. At the end of the trial, a court orders the director to refrain from purchasing or obtaining the stock of a particular corporation. Which of the following BEST describes this type of remedy?
Freya, a government contractor, has been convicted of colluding with other contractors to manipulate the competitive bidding process. After her conviction, Freya's name is added to a list of individuals who are prohibited from bidding on government contracts for a period of five years. The administrative penalty that Freya received is BEST described as:
At the end of a civil proceeding, the court finds the defendant, a company, liable and orders it to pay a large sum of money to compensate for the plaintiffs losses. Which of the following BEST describes this type of remedy?
Which of the following choices is a method of pretrial civil discovery that is often found in common law jurisdictions?
Which of the following can affect the rights that employees may have during an internal investigation?
Which of the following is a red flag that might be indicative of an entity operating a security business without the proper license or registration?
Which of the following is NOT required for a contract transaction or scheme to be classified as an investment contract?
In jurisdictions that allow criminal bargaining agreements the defendant's counsel generally has the discretion to determine whether a bargaining agreement is available to the defendant.
Which of the following statements regarding using front businesses as a method of laundering money is MOST ACCURATE?
Alicia has been charged with tax evasion. As a defense, Alicia claims that she made an honest mistake due to the complexity of the tax law and did not intentionally violate the jurisdiction's tax laws. If the court finds that her mistake was made in good faith, then she will most likely NOT be found to have willfully engaged in fraudulent actions to avoid reporting or paying her taxes.
Consents to searches by government agents that are obtained by force, duress, or bribery are NOT effective under the law and do NOT eliminate the need for a search warrant.
Under the World Bank Principles for Effective Insolvency and Credit/Debtor Regimes (World Bank Principles), which of the following parties should administer the debtor's estate in liquidation bankruptcy proceedings?
Which of the following is a legal element that must be shown to prove a claim for commercial bribery?
The Financial Action Task Force (FATF) Recommendations advise countries to do all of the following EXCEPT:
When perpetrating a bustout scheme, an individual or business typically performs which of the following actions?
Ethan a U S resident, is running a Ponzi scheme As part of the scheme, he uses the U S mail system to send promotional materials to potential victims in France If the US government decides to prosecute Ethan, which of the following would provide the MOST LIKELY basis for the charges?
Evidence that tends to make some tact at issue more or less likely than it would be without the evidence is called:
The Organisation for Economic Co-operation and Developments (OECD) Recommendation on Combating Bribery m International Business (Recommendation) urges member states to combat the bribery of foreign public officials by taking steps to improve which of the following primary areas within their respective infrastructures?
Which of the following statements is TRUE regarding criminal proceedings and discovery in adversarial jurisdictions?
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