CFE Fraud Schemes and Financial Crimes Exam Guide
This CFE Fraud Schemes and Financial Crimes exam focuses on practical knowledge and real-world application scenarios related to the subject area. It evaluates your ability to understand core concepts, apply best practices, and make informed decisions in realistic situations rather than relying solely on memorization.
This page provides a structured exam guide, including exam focus areas, skills measured, preparation recommendations, and practice questions with explanations to support effective learning.
Exam Overview
The CFE Fraud Schemes and Financial Crimes exam typically emphasizes how concepts are used in professional environments, testing both theoretical understanding and practical problem-solving skills.
Skills Measured
- Understanding of core concepts and terminology
- Ability to apply knowledge to practical scenarios
- Analysis and evaluation of solution options
- Identification of best practices and common use cases
Preparation Tips
Successful candidates combine conceptual understanding with hands-on practice. Reviewing measured skills and working through scenario-based questions is strongly recommended.
Practice Questions for CFE Fraud Schemes and Financial Crimes Exam
The following practice questions are designed to reinforce key CFE Fraud Schemes and Financial Crimes exam concepts and reflect common scenario-based decision points tested in the certification.
Question#1
Which of the following scenarios is an example of upcoding?
A. Hope is diagnosed with an ear infection. Hope's doctor writes her a prescription for a name brand medication instead of prescribing a less expensive generic medication.
B. Dr. Smith performed a hysterectomy on Roberta. Dr. Smith submits an insurance claim using three procedure codes instead of the single code normally used for a hysterectomy.
C. Dr. Catz spends 15 minutes with a patient. She later submits a bill to the patient's insurance company using a code that corresponds to an office visit lasting 60 minutes.
D. Steven receives medical services prior to his new insurance going into effect. Before submitting the claim, he changes the service date on his bill so that it will be covered by insurance.
Explanation:
Rationale for Correct Answer
Upcoding occurs when a provider bills for a higher level of service than what was actually provided.
Billing a 15-minute visit as a 60-minute visit is a classic upcoding scheme.
Analysis of Incorrect Options:
A. Name brand prescription C Not upcoding; this is prescribing choice, not billing fraud.
B. Multiple codes instead of one C This is unbundling, not upcoding.
D. Changing service date C This is falsifying service dates, not upcoding.
Key Concept: Health care billing fraud ― upcoding vs. unbundling.
Reference: ACFE Fraud Examiners Manual (2020), Fraudulent Disbursements: Health Care Fraud.
Question#2
Which of the following measures would be MOST EFFECTIVE in preventing a skimming scheme?
A. Implementing regular rotation of employee job responsibilities
B. Separating the duties of collecting cash and accessing the accounts receivable journal
C. Comparing sales records to the amount of cash that is received
D. Reviewing the amount of time between when cash is initially received and deposited
Explanation:
The correct answer is B. Skimming involves stealing cash before it is recorded in the organization’s accounting system. Separating the duties of collecting cash and accessing or posting to the accounts receivable journal is an effective preventive control because it prevents one employee from both taking funds and manipulating records to conceal the theft. Job rotation can help, but it is less direct. Comparing sales records to cash received and reviewing deposit timing are more detective than preventive in nature. The strongest control is segregation of duties between custody of cash and recordkeeping authority. The ACFE cash receipts materials emphasize receipt-level controls, general controls, and separation of duties as primary measures for preventing skimming schemes.
Question#3
Guillermo has received a grant to study the effectiveness of school lunch programs on students’ mental health. Guillermo’s results are inconclusive, causing him to be concerned that he will lose funding for his project.
As a result, Guillermo creates some data points that support his research and show that he is making progress.
Guillermo’s actions can BEST be described as:
A. Research misconduct
B. Fraudulent concealment
C. Fictitious claims fraud
D. Inducement fraud
Explanation:
Guillermo’s conduct is best described as research misconduct because he fabricated data points to make his research appear more successful and to preserve grant funding. Research misconduct commonly includes fabrication, falsification, or plagiarism in proposing, performing, reviewing, or reporting research. The key fact is that Guillermo created data that did not exist and presented it as research support. Fraudulent concealment generally involves hiding material facts, not creating false research data. Fictitious claims fraud involves submitting false claims for payment, usually to a government or program, but the question focuses on the falsification of research results. Inducement fraud is broader and less precise. Because the false data directly affects the integrity of a funded study, research misconduct is the best answer.
Disclaimer
This page is for educational and exam preparation reference only. It is not affiliated with ACFE, Certified Fraud Examiner, or the official exam provider. Candidates should refer to official documentation and training for authoritative information.
