100 Q&As in UPDATED CFE-Financial-Transactions-and-Fraud-Schemes Exam Questions Certification Test Engine to PDF
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NEW QUESTION # 10
False billing scheme states that:
- A. employees cause their company to sale merchandise that the company does not need.
- B. employees do not cause their company to purchase merchandise that the company does not need.
- C. employees do not cause their company to sale merchandise that the company does not need.
- D. employees cause their company to purchase merchandise that the company does not need
Answer: D
NEW QUESTION # 11
According to a survey, in principal perpetrator, males in a majority of cases, accounting for ___ percent of frauds versus ___ percent in which a female was the primary culprit.
- A. 62 versus 37
- B. 62 versus 36
- C. 61 versus 39
- D. None of the above
Answer: C
NEW QUESTION # 12
Which of the following situations MOST LIKELY constitutes health care fraud committed by an insurance company?
- A. Instituting procedures to detect fraudulent claims when acting as an intermediary for a government health care program
- B. Submitting cost data to health care regulators to justify rate increases
- C. Negotiating discounts with medical providers and then failing to apply those discounts toward consumers' medical bills
- D. Failing to pay a claim because the claim is missing required information
Answer: C
NEW QUESTION # 13
Which of the following scenarios is MOST indicative of a loan fraud scheme?
- A. A draw request for a construction loan
- B. No missing documents in the loan file
- C. A change order for a large project
- D. High turnover in the developer's personnel
Answer: C
NEW QUESTION # 14
Which of the following is a red flag that might indicate that someone is attempting to commit insurance fraud?
- A. A theft claim includes recently purchased items with their receipts.
- B. The insured made one other insurance claim within the past five years.
- C. A fire loss claim includes numerous personal items and family heirlooms.
- D. A claim is made a short time after a change in policy coverage.
Answer: D
Explanation:
Explanation/Reference: https://www.acfe.com/uploadedfiles/acfe_website/content/documents/insurance-fraud-handbook.pdf
NEW QUESTION # 15
Geoffrey, a homeowner, has decided to add a patio to the back of his house. Geoffrey hires a contractor who insists on receiving payment up front so that he can pay for the materials required to complete the construction.
The following week, Geoffrey is surprised to learn that the contractor has not arrived and is not answering his phone calls. Geoffrey has MOST LIKELY been victimized by which of the following frauds?
- A. Advance-fee scheme
- B. Deposit scheme
- C. Block hustle scheme
- D. Scavenger scheme
Answer: A
Explanation:
Explanation/Reference: https://www.linkedin.com/pulse/advance-fee-schemes-kabir-ibrahim-cisa-cfe-c
NEW QUESTION # 16
Larceny by Fraud or deception means that:
- A. Creates or reinforce a false impression
- B. Fails to correct a false impression
- C. Fails to disclose a known lien, adverse claim or other legal impediment
- D. All of the above
Answer: D
NEW QUESTION # 17
Another way to eliminate competition in the solicitation phase of the selection process is to:
- A. Solicit bid from fictitious suppliers
- B. Solicit bid-splitting from fictitious vendors
- C. Solicit transaction from fictitious vendors
- D. None of the above
Answer: A
NEW QUESTION # 18
Green was a salesperson whose job required frequent travel. When Green went on a trip with her family that was not business related, she saved the receipts from her flight, hotel, and restaurant expenses. She turned in these receipts to her manager along with an expense report that described the expenses as business related.
Green's company reimbursed her for the expenses. This is an example of what type of expense reimbursement scheme?
- A. A mischaracterized expense scheme
- B. A fictitious expense scheme
- C. An overstated expense scheme
- D. A multiple reimbursement scheme
Answer: A
Explanation:
Explanation/Reference: https://www.bakertilly.com/insights/expense-reimbursement-schemes
NEW QUESTION # 19
A shell company scheme in which actual goods or services are sold to the victim company is known as:
- A. Maintenance scheme
- B. Distribution scheme
- C. Pass-through scheme
- D. Allocation scheme
Answer: C
NEW QUESTION # 20
Theft of incoming checks usually occurs when ________ is (are) in charge of opening the mail and recording the receipt of payments.
- A. Two employees
- B. Single employee
- C. None of the above
- D. More then two employees
Answer: B
NEW QUESTION # 21
Which of the following scenarios is an example of upcoding?
- A. Margot inflates a medical bill she is seeking reimbursement for by adding an additional digit to the amount charged.
- B. Dr. Johnson, a psychiatrist, regularly sees patients for sessions lasting less then forty minutes, but she submits the claims with a code that indicates the sessions were sixty minutes long.
- C. Victor receives payment in exchange for undergoing an unnecessary medical procedure that is then billed to his health care program.
- D. Dr. Hernandez uses four procedure codes when submitting a claim for a coronary bypass he performed that is supposed to be billed using a single procedure code.
Answer: B
Explanation:
Explanation/Reference: https://www.acfeinsights.com/acfe-insights/2018/12/12/health-care-fraud-5-common-billing-schemes
NEW QUESTION # 22
Which of the following is not the skimming scheme?
- A. Understand sales and receivables
- B. Theft of checks through the mail
- C. Fraud & Cost
- D. Unrecorded sales
Answer: C
NEW QUESTION # 23
June, a 76-year-old woman, receives a phone call from a man impersonating one of her relatives. He claims to have a lot of debt and asks her to secretly send him money so that the rest of the family will not find out. June has MOST LIKELY been victimized by which of the following schemes?
- A. Missing-heir scheme
- B. Pretexting fraud
- C. Grandparent scheme
- D. Affinity fraud
Answer: B
Explanation:
Explanation/Reference: https://www.acfe.com/article.aspx?id=504
NEW QUESTION # 24
Which of the following is true for Red flags associated with fictitious revenues?
- A. A significant volume of sales to entries whose substance and ownership is not known.
- B. Slow growth or usual profitability, when not compared to other companies in the same industry.
- C. Usual growth in the number of days purchase in receivables
- D. A usual surge in purchase by a majority of units within a company, or of purchase recorded by corporate headquarters.
Answer: A
NEW QUESTION # 25
According to accounting principles, ________ and ________ should be recorded or atched in the same accounting period; failing to do so violates the matching principle of AAP.
- A. Capitalized expenses and Liabilities
- B. Revenue and Income statement
- C. Revenue and corresponding expenses
- D. Income statement and Long-term contracts
Answer: C
NEW QUESTION # 26
Verify supporting documentation on outstanding checks written for a material amount is a test used to conduct for:
- A. Check disbursement
- B. Bank confirmation
- C. Cut-off statements
- D. Bank confirmation
Answer: D
NEW QUESTION # 27
A tangible asset is one which is:
- A. Both A & B
- B. capable of being perceived
- C. Neither A nor B
- D. capable of being appraised
Answer: A
NEW QUESTION # 28
The forms that allow noncash assets to be moved from one location in a company to another can be used to facilitate the misappropriation of those assets are called:
- A. Asset requisition
- B. Fake sales
- C. All of the above
- D. Inventory usages
Answer: A
NEW QUESTION # 29
Financial statement fraud can BEST be describes as:
- A. The misstatement or omission of financial information for the purpose of personal gain
- B. The intentional understatement of assets or overstatement of liabilities on the balance sheet
- C. The deliberate misrepresentation of a company's financial condition
- D. The intentional or accidental misstatement of amounts in the financial statements
Answer: B
Explanation:
Explanation/Reference: https://www.investopedia.com/articles/financial-theory/11/detecting-financial-fraud.asp
NEW QUESTION # 30
Which of the following is NOT a distinguishing feature of a Ponzi scheme?
- A. Participants believe that they are making a legitimate investment.
- B. Previous investors are paid with money from new members.
- C. Promoters of Ponzi schemes engage in little or no valid commerce or investments.
- D. Participants attempt to recruit as many new members as possible.
Answer: B
Explanation:
Explanation/Reference: https://www.acfe.com/ponzi-schemes.aspx#:~:text=A%20Ponzi%20scheme%20is%20an,actually%20a%20distribution%20of%20capital
NEW QUESTION # 31
Which of the following method is NOT used to detect conflicts of interest?
- A. Review of vendor ownership files
- B. Interviews with purchasing personnel
- C. Tips & Complaints
- D. Underbillings of assets
Answer: D
NEW QUESTION # 32
The difference between assets and liabilities is called:
- A. Income statement
- B. Equity
- C. Revenue
- D. Expense
Answer: B
NEW QUESTION # 33
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The Association of Certified Fraud Examiners (ACFE) Certified Fraud Examiner - Financial Transactions and Fraud Schemes (CFE-Financial-Transactions-and-Fraud-Schemes) certification exam is designed to test the knowledge and skills of individuals who are involved in the prevention, detection, and investigation of financial fraud. Certified Fraud Examiner - Financial Transactions and Fraud Schemes Exam certification is a globally recognized credential that demonstrates a high level of expertise in detecting and preventing financial fraud.
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