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CFE-Fraud-Schemes-and-Financial-Crimes Practice Questions

Certified Fraud Examiner -Fraud Schemes and Financial Crimes

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Question # 61

Which of the following is a recommended method for safeguarding an organization's proprietary information?

Options:

A.  

Changing locks and reprogramming door access codes every three to five years

B.  

Classifying data into security access levels based on the number of years that employees have worked for the company

C.  

Educating employees about nondisclosure agreements when they are hired and during exit interviews

D.  

Requiring employees to make notes and keep drafts related to confidential projects

Discussion 0
Question # 62

Which of the following scenarios BEST illustrates a misrepresentation health care fraud scheme?

Options:

A.  

Gina submits a claim to her insurance company for a dermatological procedure that she canceled before her appointment.

B.  

Marco is a heavy smoker but indicates that he is a nonsmoker on his insurance application so that he will be eligible for full insurance coverage.

C.  

Ada is still on her ex-husband’s health insurance policy and uses it to submit a claim for her hip replacement surgery.

D.  

Xavier is reimbursed for knee surgery by a government health care program and then submits a claim for the procedure under his private insurance policy.

Discussion 0
Question # 63

Skylar messages Timothy on a social media platform even though they have never met and expresses romantic interest. When Timothy responds, Skylar asks him to move the conversation to an outside messaging platform, and they develop a romantic relationship over several months through their communications. During this time, Skylar never requests that Timothy send her money or items of value, but she does convince him to make several large purchases of cryptocurrencies through a new cryptocurrency exchange. When Timothy tries to sell the cryptocurrency at a profit and withdraw his funds, Skylar stops responding to his messages, and he discovers the cryptocurrency exchange did not actually exist. Timothy is a victim of:

Options:

A.  

A Ponzi scheme

B.  

A pump-and-dump scheme

C.  

A pig butchering scheme

D.  

An advance-fee scheme

Discussion 0
Question # 64

David, an accounts receivable clerk at a fitness center, steals a customer’s monthly membership payment. When he receives another customer’s payment a few days later, David applies the payment to the first customer’s account. He then applies payment from a third customer to the second customer’s account. David is MOST LIKELY committing a:

Options:

A.  

Lapping scheme

B.  

Padding scheme

C.  

Substitution scheme

D.  

Duplication scheme

Discussion 0
Question # 65

Which of the following options BEST describes horizontal analysis?

Options:

A.  

A means of measuring the performance of a parent company to one of its subsidiaries

B.  

A means of examining the percentage change in individual line items on a financial statement from one accounting period to the next

C.  

A means of measuring the relationship between two different financial statement amounts

D.  

A means of examining the relationship of items on a financial statement by expressing components as percentages of a specified base value

Discussion 0
Question # 66

Which of the following is NOT a standard of generally accepted accounting principles (GAAP)?

Options:

A.  

Conservatism

B.  

Cost

C.  

Full disclosure

D.  

Quality control

Discussion 0
Question # 67

Which of the following is an example of a cash larceny scheme ?

Options:

A.  

Laura pretends to record a sale on the cash register when Amy makes a purchase, but she steals Amy’s cash instead and gives her the merchandise without recording the sale.

B.  

Anne buys a $500 table from a shop. Olive, the cashier, records a $400 sale on the cash register and steals the excess $100.

C.  

Scott performs a No-Sale transaction on the cash register, opens the register drawer, and takes a $100 bill.

D.  

Michael is a cashier at a store. He records a fictitious return of a $50 jacket and takes $50 from the cash register.

Discussion 0
Question # 68

Which of the following statements describes a best practice for preventing electronic payment tampering?

Options:

A.  

Positive pay for ACH should be declined to stop unauthorized transactions from being withdrawn from bank accounts.

B.  

ACH blocks should be used by account holders to notify their banks which of their accounts should not be used for ACH debits.

C.  

The same individual should be responsible for making electronic payments and applying ACH filters to accounts.

D.  

Companies should use the same bank account for paper checks and electronic transactions to improve their ability to monitor all banking activity.

Discussion 0
Question # 69

The behavior profile of employees who are involved in bribery schemes may include:

Options:

A.  

Gambling habit

B.  

Extravagant lifestyle

C.  

Drug and/or alcohol addiction

D.  

All of the above

Discussion 0
Question # 70

_________ normally are carried on an organization’s books as expenses because they tend to be consumed by the organization within a year of purchase.

Options:

A.  

Supplies

B.  

Expenses

C.  

Assets

D.  

Equity

Discussion 0
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