ACFE Updated CFE-Fraud-Prevention-and-Deterrence Exam Questions and Answers by amayah

The ACFE has found that terminating the employee involved in fraud is the most common internal response to substantiated cases. While many fraud cases are handled internally without being referred to law enforcement, this is often due to concerns such as reputational damage or cost considerations rather than a lack of evidence.

Rational choice theory posits that criminal behavior is a result of deliberate decision-making. According to the ACFE manual:

“Rational choice theory assumes that individuals weigh the expected benefits of committing a crime against the possible consequences. If the perceived benefits outweigh the perceived risks, the individual may choose to offend.”

Purpose of the Task:

The team seeks candid feedback on ethical tone, which requires a confidential and direct interaction method.

Comparison of Techniques:

A. Interviews:Effective for obtaining one-on-one feedback in a private setting.

B. Focus groups:Group dynamics may inhibit candid responses due to peer pressure.

C. Anonymous feedback mechanisms:These provide insights but lack the depth and follow-up opportunities of interviews.

D. Surveys:While useful for broad input, surveys are less effective for detailed exploration of ethical tone.

Conclusion:Interviews are the most helpful technique for gathering one-on-one candid feedback.

Fraud Risk Management Program Requirements:

Effective fraud risk management programs ensure transparency, consistency, and fairness.

Sanctions for noncompliance should be transparent and communicated to demonstrate a commitment to accountability.

Analysis of Options:

A. Mechanisms for breaches:Necessary to address compliance issues.

B. Consistent and firm punishment:Ensures a deterrent effect.

D. Designated compliance monitors:Vital for program enforcement.

C. Enacted privately:This is false because transparency is essential to maintain trust and deter similar actions.

Conclusion:Option C is false as formal sanctions should be communicated appropriately to promote deterrence and accountability.