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ACFE CFE-Fraud-Schemes-and-Financial-Crimes Exam Questions
- Topic 1: Asset Misappropriation and Internal Fraud: This domain covers schemes involving the theft or misuse of an organization's assets by employees or insiders. It focuses on common occupational fraud methods, concealment techniques, and the financial impact of internal fraud on businesses.
- Topic 2: Corruption and Bribery Schemes: This domain examines fraud involving abuse of authority for personal gain. It includes bribery, conflicts of interest, kickbacks, and other corruption-related activities that compromise business integrity and decision-making.
- Topic 3: Financial Statement Fraud: This domain focuses on intentional misrepresentation of financial information. It covers methods used to manipulate accounting records, overstate assets or revenue, understate liabilities, and deceive stakeholders.
- Topic 4: Fraudulent Financial Transactions and Payment Crimes: This domain addresses crimes involving financial instruments, payment systems, and banking activities. It examines how fraudsters exploit financial processes to obtain funds unlawfully or conceal illicit transactions.
- Topic 5: Money Laundering and Other Financial Crimes: This domain covers the methods used to conceal the origins of illegally obtained funds and other related financial crimes. It focuses on laundering processes, regulatory concerns, and indicators of suspicious financial activity.
Free ACFE CFE-Fraud-Schemes-and-Financial-Crimes Exam Actual Questions
Note: Premium Questions for CFE-Fraud-Schemes-and-Financial-Crimes were last updated On Oct. 19, 2026 (see below)
Which of the following is a red flag that might indicate that someone is attempting to commit insurance fraud?
Rationale for Correct Answer:
Filing a claim shortly after a policy begins is a classic red flag of potential insurance fraud, as it may indicate the loss occurred before coverage or is fabricated.
Analysis of Incorrect Options:
B . One prior claim in five years -- Not unusual by itself.
C . Small electronics/jewelry -- Common theft items, not automatically suspicious.
D . Recently purchased items with receipts -- Strong documentation actually supports legitimacy.
Key Concept: Insurance fraud red flags.
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:
The correct answer is A. David is committing a lapping scheme. Lapping occurs when an employee steals one customer's payment and conceals the theft by applying a later payment from another customer to the first customer's account. The employee must then continue shifting later payments to earlier accounts to keep the shortage hidden. This creates a rolling concealment pattern that can continue until discovered through customer complaints, account confirmations, delayed postings, or independent reconciliation. Padding, substitution, and duplication are not the standard ACFE classifications for this receivables concealment method. Because David is using later customer payments to cover earlier stolen receipts, his conduct fits the classic definition of lapping under cash receipts fraud schemes.
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Which of the following is an example of a corruption scheme?
Rationale for Correct Answer: Corruption schemes involve the misuse of influence in
Analysis of Incorrect Options:
A -- Theft of confidential information = asset misappropriation/intellectual property theft, not corruption.
C -- Excluding laptops from records = inventory theft, not corruption.
D -- Omitting costs = financial statement fraud.
Key Concept: Bribery as a form of corruption.
Skimming is:
Rationale for Correct Answer:
Skimming is defined as the theft of cash before it is recorded in the books. Because the stolen funds are never entered into the accounting system, this is often referred to as an ''off-book'' fraud. It is distinct from cash larceny, which occurs after cash has been recorded.
Analysis of Incorrect Options:
B . The addition of cash -- Incorrect; skimming involves removal, not addition.
C . Removal after entry -- This describes cash larceny, not skimming.
D . None of above -- Incorrect since option A is correct.
Key Concept:
Skimming schemes --- off-book cash theft.
ACFE Fraud Examiners Manual (2020 International Edition), Cash Receipts --- Skimming Schemes.
Which of the following is NOT an example of bribery prevention policies?
Rationale for Correct Answer:
Bribery prevention policies often include:
Reporting gifts (disclosure of items received from vendors),
Discounts (rules about vendor concessions),
Business meetings (clear rules on vendor-sponsored events).
Resource diversions is not a standard bribery prevention policy but a form of fraud.
Analysis of Incorrect Options:
A, B, C -- Legitimate examples of prevention policies.
D . Resource diversions -- Not a preventive measure.
Key Concept:
Anti-bribery policies --- clear rules on gifts, discounts, and vendor relationships.
ACFE Fraud Examiners Manual (2020 International Edition), Corruption --- Prevention of Bribery Schemes.
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