Free CFE-Fraud-Prevention-and-Deterrence: Certified Fraud Examiner - Fraud Prevention and Deterrence Exam Questions and Answers

Last updated: September 19, 2026

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1. Question #1

   Jane, a Certified Fraud Examiner (CFE), was hired to conduct a fraud examination at XYZ Company. Her examination did not reveal any conclusive evidence that fraud had occurred or was occurring. Consequently, XYZ's management asked Jane to state in her official examination report that the company is free of fraud as a means of assuring the board of directors that the company's anti-fraud controls were effective. The ACFE Code of Professional Ethics prohibits Jane from complying with management's request.

   • A. True
   • B. False
   Reveal Answer

2. Question #2

   According to the differential reinforcement theory, behavior is weakened when positive rewards are gained or punishment is avoided

   • A. True
   • B. False
   Reveal Answer

3. Question #3

   Which of the following theories suggests that, when considering the possibility of violating a law, people are likely to ask themselves, "What would my family and friends think if they find out?"

   • A. Cognitive theory
   • B. Social control theory
   • C. Behavioral theory
   • D. Routine activities theory
   Reveal Answer

4. Question #4

   According to the authors of Crimes of the Middle Classes, all of the following factors have contributed to the rising problem of economic crime EXCEPT:

   • A. The continued pressures of a culture that rewards affluence and success
   • B. The economy's increased reliance on credit
   • C. The decrease in funds available from government assistance programs
   • D. The increased opportunity for wrongdoing as a result of advancing information technologies
   Reveal Answer

5. Question #5

   Criminologist Charles McCaghy has stated that profit pressure is the single most compelling factor behind deviance by organizations.

   • A. True
   • B. False
   Reveal Answer

6. Question #6

   Fraud risks related to corruption include all of the following EXCEPT:

   • A. Espionage by competitor
   • B. Aiding and abetting vendor fraud
   • C. Payment of bribes
   • D. Receipt of kickbacks
   Reveal Answer

7. Question #7

   White, a Certified Fraud Examiner (CFE), was hired to conduct a fraud examination. She did not find fraud, but, in White's opinion, there were several internal control deficiencies that, if not remediated, could facilitate the occurrence of fraud. Under the ACFE Code of Professional Ethics, White may include her opinion on the controls in her report to management.

   • A. True
   • B. False
   Reveal Answer

8. Question #8

   As part of her audit of ABC Corp., Rachel, a CPA, is identifying the risks of material misstatement due to fraud. As part of this task, she should evaluate any unexpected relationships that she identified in performing analytical procedures.

   • A. True
   • B. False
   Reveal Answer

9. Question #9

   Which of the following statements about the fraud risk assessment process is MOST ACCURATE?

   • A. To ensure the independence of the team members a fraud risk assessment must be conducted by a consultant or other external party.
   • B. The assessment team must be perceived as independent and objective by others for the assessment to be effective
   • C. If the individuals conducting the fraud risk assessment truly believe that fraud could not happen at the organization the assessment process should reflect that belief.
   • D. The fraud risk assessment is most effective when management's influence on the process is limited.
   Reveal Answer

10. Question #10

    Which of the following is NOT a way that an organization's fraud risk assessment should be incorporated into the audit process?

    • A. It should be used to replace the auditor's own identification and assessment of fraud risks.
    • B. It should be used to assess whether there is a moderate-to-high risk of management override of internal controls within the moderate-to-high fraud risk areas
    • C. It should be used to increase awareness in the development of audit programs for areas that have been identified as having a moderate-to-high risk of fraud.
    • D. It should be used to design audit tests to evaluate whether the controls are operating effectively
    Reveal Answer