CIPS L5M5 Exam - Topic 1 Question 1 Discussion

Actual exam question for CIPS's L5M5 exam

Question #: 1
Topic #: 1

[All L5M5 Questions]

Which of the following is not a fraud risk in a procurement function?

ABid rigging

BDuplicating payments

CPhantom suppliers

DAccepting presents

Show Suggested Answer

Suggested Answer: D

Comprehensive and Detailed Explanation From Exact Extract of Documents:

Fraud risks in procurement typically include practices such as bid rigging (collusion to manipulate tenders), phantom suppliers (fake companies created to siphon money), and deliberate duplicate payments (processing false or repeated invoices). However, accepting presents is classified as bribery, not fraud. The L5M5 study guide (old p.139, new p.50) explains that fraud involves intentional deception for personal gain, while bribery relates to improper inducements or gifts. Procurement professionals must distinguish between fraud and bribery because both undermine ethical procurement but require different controls. For example, fraud prevention requires audit trails and segregation of duties, while anti-bribery policies require clear rules on gifts and hospitality.

Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, old p.139, new p.50

by Stanton at Oct 04, 2025, 06:45 AM

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Jamie

5 days ago

Yeah, C) Phantom suppliers is a clear risk as well.

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Isabella

11 days ago

B) Duplicating payments is definitely a fraud risk.

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Lamar

16 days ago

True, but D) doesn't directly impact procurement.

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Shannon

21 days ago

But A) Bid rigging seems pretty serious too.

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Cathrine

26 days ago

I agree, it feels more like a gray area.

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Demetra

1 month ago

I agree with Sarah, presents can lead to trouble!

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Roxanne

1 month ago

Wait, phantom suppliers? Is that really a thing?

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Audra

1 month ago

No way, all of these can be fraud risks!

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Kindra

2 months ago

I think D) Accepting presents could be risky too.

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Narcisa

2 months ago

Definitely A) Bid rigging is a fraud risk.

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Shelia

2 months ago

Phantom suppliers sounds familiar; I feel like we had a practice question on that. I think it's definitely a fraud risk.

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Raul

2 months ago

Accepting presents? That's just good customer service! What's the big deal?

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Mariann

2 months ago

I think it's D) Accepting presents.

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Dominga

2 months ago

I remember discussing bid rigging in class, but I'm not sure if it's considered a fraud risk or just a common practice.

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Jacinta

3 months ago

I think duplicating payments is definitely a fraud risk, but I can't recall if accepting presents falls under that category.

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Noble

3 months ago

I'm torn between D and A. I feel like accepting presents might not be as serious as the others, but I could be wrong.

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Jonell

3 months ago

C) Phantom suppliers? Sounds like something out of a spy movie. Too good to be true!

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Annice

3 months ago

A) Bid rigging? That's just smart business, right? Gotta stay competitive.

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Whitley

4 months ago

B) Duplicating payments is definitely not a fraud risk. That's just good accounting practice!

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Laticia

4 months ago

D) Accepting presents seems like the obvious choice here. Who doesn't love a little gift now and then?

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Deeanna

4 months ago

Okay, I've got a strategy - I'll eliminate the options that are clearly fraud risks, then choose the remaining one.

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Florinda

4 months ago

Ugh, I'm not sure about this. I'll have to review my notes on procurement fraud to figure this out.

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Kiley

4 months ago

Accepting presents seems like the obvious non-fraud risk here. I'm pretty confident about that one.

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Louann

5 months ago

Hmm, this is a tricky one. I'll need to really consider the different types of fraud risks in procurement.

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Jutta

5 months ago

I think I've seen this type of question before. Let me think through the options carefully.

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