CFE Exam Law Questions With Correct
Answers
U.S. Foreign Corrupt Practices Act's (FCPA) - CORRECT ANSWER✔✔-prohibits the
| | | | | | | | | |
payment or offer of anything of value to a foreign official for the purpose of
| | | | | | | | | | | | | | |
obtaining or retaining business. Promises to pay are considered items of value.
| | | | | | | | | | | |
Furthermore, foreign companies are within the reach if they have registered
| | | | | | | | | | |
securities or are otherwise required to file under the U.S. Securities Exchange Act
| | | | | | | | | | | | |
of 1934 (the Exchange Act).
| | | |
The Financial Action Task Force (FATF) - CORRECT ANSWER✔✔-an
| | | | | | | | |
intergovernmental body that was established at the G-7 Summit in 1989. Its | | | | | | | | | | | |
purpose is to develop and promote standards and policies to combat money
| | | | | | | | | | | |
laundering and terrorist financing at both the national and international levels.
| | | | | | | | | | |
The Recommendations, revised in 2012, created the most comprehensive
| | | | | | | | |
standard with which to measure a country's anti-money laundering (AML),
| | | | | | | | | |
counterterrorism, & nuclear proliferation laws and policies. serve as a basic | | | | | | | | | | |
framework of laws that its members should have. While the FATF
| | | | | | | | | | |
Recommendations are not req by the FATF's members, and the FATF | | | | | | | | | | |
acknowledges that following each rule might not be possible, members often
| | | | | | | | | | |
adopt them.|
Civil Law Systems - CORRECT ANSWER✔✔-apply laws from an accepted set of
| | | | | | | | | | | |
codified principles or compiled statutes. Individual cases are then decided in
| | | | | | | | | | |
accordance w/ these basic tenets. Under this system, judges/judicial
| | | | | | | | |
administrators are bound only by the civil code, not by the previous decisions of
| | | | | | | | | | | | | |
other courts. In deciding legal issues, a civil law judge applies the various codified
| | | | | | | | | | | | | |
principles to each case. | | |
,False Imprisonment - CORRECT ANSWER✔✔-the unlawful restraint by one person
| | | | | | | | |
of the physical liberty of another without consent or legal justification.
| | | | | | | | | | | |
There are no precise rules as to when a false imprisonment occurs, but factors
| | | | | | | | | | | | | |
such as the length, nature, and manner of the interview might determine
| | | | | | | | | | | |
whether liability arises. | |
Jury Trials - CORRECT ANSWER✔✔-While jury trials are typically used in criminal
| | | | | | | | | | | |
proceedings in common law jurisdictions, this is not always the case. For some
| | | | | | | | | | | | |
cases, usually minor criminal offenses, a jury trial might not be available. In
| | | | | | | | | | | | |
serious cases, however, jury trials are typically available. Additionally, many
| | | | | | | | | |
common law jurisdictions allow the defendant to waive the right to trial by jury.
| | | | | | | | | | | | | |
When no jury is present, the judge serves as the fact finder.
| | | | | | | | | | |
Chain of Custody - CORRECT ANSWER✔✔-the primary reason for maintaining this
| | | | | | | | | |
on an item of evidence is to establish that the evidence has not been
| | | | | | | | | | | | | |
altered/changed. If evidence is subject to change over time or susceptible to
| | | | | | | | | | | | |
alteration, the offering party might need to establish that the evidence hasn't
| | | | | | | | | | | |
been altered or changed from the time it was collected through its production in
| | | | | | | | | | | | | |
court. Can be an important factor in establishing authenticity. this is both a
| | | | | | | | | | | | |
process & a document that memorializes (1) who has had possession of an object
| | | | | | | | | | | | |
& (2) what they have done w/ it.
| | | | | | | |
Exhibits in Common Law Systems - CORRECT ANSWER✔✔-the tangible objects
| | | | | | | | | |
presented as evidence—are inadmissible unless they are relevant and established
| | | | | | | | |
as authentic. Thus, to be admissible at trial, evidence, other than testimonial
| | | | | | | | | | | | |
evidence, must be properly authenticated; that is, the party offering the item
| | | | | | | | | | | |
must produce some evidence to show it is, in fact, what the party says it is and to
| | | | | | | | | | | | | | | | |
,show it is in the same condition as when it was seized. If an exhibit can't be
| | | | | | | | | | | | | | | | | |
authenticated, it won't be admitted even if it's plainly relevant. | | | | | | | | |
Both the UK Bribery Act and the U.S. Foreign Corrupt Practices Act (FCPA) make it
| | | | | | | | | | | | | | |
a crime to: - CORRECT ANSWER✔✔-offer foreign public officials bribes or to
| | | | | | | | | | | |
accept bribes from them in connection with international business transactions,
| | | | | | | | | |
and their prohibitions on bribing foreign government officials are broadly
| | | | | | | | | |
comparable. Thus, like the FCPA, the UK Bribery Act seeks to punish corruption on
| | | | | | | | | | | | |
a global level, but the UK Bribery Act has an even broader application than the
| | | | | | | | | | | | | | | |
FCPA.
Lay Witness - CORRECT ANSWER✔✔-is anyone who provides nonexpert
| | | | | | | | |
testimony. Note, however, that an expert witness might also provide lay
| | | | | | | | | | |
testimony. Typically, a fraud examiner who worked on a case will be capable of
| | | | | | | | | | | | | |
providing lay testimony based on observations made during the investigation.
| | | | | | | | | |
When a trial involves issues that are complex or unfamiliar to most people, as is
| | | | | | | | | | | | | | |
common in incidents of fraud, expert testimony is appropriate to help the fact
| | | | | | | | | | | | |
finder understand these issues.
| | |
Lay Testimony - CORRECT ANSWER✔✔-(sometimes called factual testimony),
| | | | | | | |
where witnesses testify about what they have experienced firsthand & factual
| | | | | | | | | | |
observations.
United Nations' (UN) International Covenant on Civil and Political Rights (ICCPR) -
| | | | | | | | | | | |
CORRECT ANSWER✔✔-commits signing countries to recognizing various rights of
| | | | | | | | |
citizens. Part III of the ICCPR includes the rights of those accused of crimes. As
| | | | | | | | | | | | | | |
one of these rights, the ICCPR states that all people accused of crimes are entitled
| | | | | | | | | | | | | |
to a fair hearing before a court or other tribunal and that the results of the trial
| | | | | | | | | | | | | | | | | |
, should be made public to protect the criminal justice system's transparency. This
| | | | | | | | | | | |
right includes: |
- Adequate time to prepare a defense
| | | | | |
- The ability to be represented by legal counsel of the defendant's choosing and
| | | | | | | | | | | | | |
to freely communicate with counsel
| | | |
- The right to have accusations and the procedures explained through a translator
| | | | | | | | | | | |
|for free, if necessary
| | |
- The right to be tried for charges without undue delay
| | | | | | | | | |
- The right to examine or have examined the witnesses against the accused
| | | | | | | | | | | |
- Freedom from testifying against oneself or compelled confessions
| | | | | | | |
Intrusion into an individual's private matters (often referred to as intrusion upon
| | | | | | | | | | | |
seclusion) - CORRECT ANSWER✔✔-a common law invasion of privacy civil wrong
| | | | | | | | | | |
that occurs when an individual intentionally encroaches into an area where
| | | | | | | | | | |
another individual has a reasonable expectation of privacy and the encroachment
| | | | | | | | | |
|would be highly offensive or objectionable to a reasonable person
| | | | | | | | |
Recommendation on Combating Bribery in International Business | | | | | | |
(Recommendation) - CORRECT ANSWER✔✔-published by the Organisation for | | | | | | | |
Economic Co-operation and Development (OECD) in 1994, urges member states
| | | | | | | | | |
to deter and penalize the bribery of foreign public officials by taking "concrete
| | | | | | | | | | | | |
and meaningful steps" to improve the following areas within their respective
| | | | | | | | | | |
infrastructures:
- Criminal, civil, commercial, and administrative laws
| | | | | |
- Tax systems and regulations
| | | |
- Banking and accounting requirements and practices
| | | | | |
Answers
U.S. Foreign Corrupt Practices Act's (FCPA) - CORRECT ANSWER✔✔-prohibits the
| | | | | | | | | |
payment or offer of anything of value to a foreign official for the purpose of
| | | | | | | | | | | | | | |
obtaining or retaining business. Promises to pay are considered items of value.
| | | | | | | | | | | |
Furthermore, foreign companies are within the reach if they have registered
| | | | | | | | | | |
securities or are otherwise required to file under the U.S. Securities Exchange Act
| | | | | | | | | | | | |
of 1934 (the Exchange Act).
| | | |
The Financial Action Task Force (FATF) - CORRECT ANSWER✔✔-an
| | | | | | | | |
intergovernmental body that was established at the G-7 Summit in 1989. Its | | | | | | | | | | | |
purpose is to develop and promote standards and policies to combat money
| | | | | | | | | | | |
laundering and terrorist financing at both the national and international levels.
| | | | | | | | | | |
The Recommendations, revised in 2012, created the most comprehensive
| | | | | | | | |
standard with which to measure a country's anti-money laundering (AML),
| | | | | | | | | |
counterterrorism, & nuclear proliferation laws and policies. serve as a basic | | | | | | | | | | |
framework of laws that its members should have. While the FATF
| | | | | | | | | | |
Recommendations are not req by the FATF's members, and the FATF | | | | | | | | | | |
acknowledges that following each rule might not be possible, members often
| | | | | | | | | | |
adopt them.|
Civil Law Systems - CORRECT ANSWER✔✔-apply laws from an accepted set of
| | | | | | | | | | | |
codified principles or compiled statutes. Individual cases are then decided in
| | | | | | | | | | |
accordance w/ these basic tenets. Under this system, judges/judicial
| | | | | | | | |
administrators are bound only by the civil code, not by the previous decisions of
| | | | | | | | | | | | | |
other courts. In deciding legal issues, a civil law judge applies the various codified
| | | | | | | | | | | | | |
principles to each case. | | |
,False Imprisonment - CORRECT ANSWER✔✔-the unlawful restraint by one person
| | | | | | | | |
of the physical liberty of another without consent or legal justification.
| | | | | | | | | | | |
There are no precise rules as to when a false imprisonment occurs, but factors
| | | | | | | | | | | | | |
such as the length, nature, and manner of the interview might determine
| | | | | | | | | | | |
whether liability arises. | |
Jury Trials - CORRECT ANSWER✔✔-While jury trials are typically used in criminal
| | | | | | | | | | | |
proceedings in common law jurisdictions, this is not always the case. For some
| | | | | | | | | | | | |
cases, usually minor criminal offenses, a jury trial might not be available. In
| | | | | | | | | | | | |
serious cases, however, jury trials are typically available. Additionally, many
| | | | | | | | | |
common law jurisdictions allow the defendant to waive the right to trial by jury.
| | | | | | | | | | | | | |
When no jury is present, the judge serves as the fact finder.
| | | | | | | | | | |
Chain of Custody - CORRECT ANSWER✔✔-the primary reason for maintaining this
| | | | | | | | | |
on an item of evidence is to establish that the evidence has not been
| | | | | | | | | | | | | |
altered/changed. If evidence is subject to change over time or susceptible to
| | | | | | | | | | | | |
alteration, the offering party might need to establish that the evidence hasn't
| | | | | | | | | | | |
been altered or changed from the time it was collected through its production in
| | | | | | | | | | | | | |
court. Can be an important factor in establishing authenticity. this is both a
| | | | | | | | | | | | |
process & a document that memorializes (1) who has had possession of an object
| | | | | | | | | | | | |
& (2) what they have done w/ it.
| | | | | | | |
Exhibits in Common Law Systems - CORRECT ANSWER✔✔-the tangible objects
| | | | | | | | | |
presented as evidence—are inadmissible unless they are relevant and established
| | | | | | | | |
as authentic. Thus, to be admissible at trial, evidence, other than testimonial
| | | | | | | | | | | | |
evidence, must be properly authenticated; that is, the party offering the item
| | | | | | | | | | | |
must produce some evidence to show it is, in fact, what the party says it is and to
| | | | | | | | | | | | | | | | |
,show it is in the same condition as when it was seized. If an exhibit can't be
| | | | | | | | | | | | | | | | | |
authenticated, it won't be admitted even if it's plainly relevant. | | | | | | | | |
Both the UK Bribery Act and the U.S. Foreign Corrupt Practices Act (FCPA) make it
| | | | | | | | | | | | | | |
a crime to: - CORRECT ANSWER✔✔-offer foreign public officials bribes or to
| | | | | | | | | | | |
accept bribes from them in connection with international business transactions,
| | | | | | | | | |
and their prohibitions on bribing foreign government officials are broadly
| | | | | | | | | |
comparable. Thus, like the FCPA, the UK Bribery Act seeks to punish corruption on
| | | | | | | | | | | | |
a global level, but the UK Bribery Act has an even broader application than the
| | | | | | | | | | | | | | | |
FCPA.
Lay Witness - CORRECT ANSWER✔✔-is anyone who provides nonexpert
| | | | | | | | |
testimony. Note, however, that an expert witness might also provide lay
| | | | | | | | | | |
testimony. Typically, a fraud examiner who worked on a case will be capable of
| | | | | | | | | | | | | |
providing lay testimony based on observations made during the investigation.
| | | | | | | | | |
When a trial involves issues that are complex or unfamiliar to most people, as is
| | | | | | | | | | | | | | |
common in incidents of fraud, expert testimony is appropriate to help the fact
| | | | | | | | | | | | |
finder understand these issues.
| | |
Lay Testimony - CORRECT ANSWER✔✔-(sometimes called factual testimony),
| | | | | | | |
where witnesses testify about what they have experienced firsthand & factual
| | | | | | | | | | |
observations.
United Nations' (UN) International Covenant on Civil and Political Rights (ICCPR) -
| | | | | | | | | | | |
CORRECT ANSWER✔✔-commits signing countries to recognizing various rights of
| | | | | | | | |
citizens. Part III of the ICCPR includes the rights of those accused of crimes. As
| | | | | | | | | | | | | | |
one of these rights, the ICCPR states that all people accused of crimes are entitled
| | | | | | | | | | | | | |
to a fair hearing before a court or other tribunal and that the results of the trial
| | | | | | | | | | | | | | | | | |
, should be made public to protect the criminal justice system's transparency. This
| | | | | | | | | | | |
right includes: |
- Adequate time to prepare a defense
| | | | | |
- The ability to be represented by legal counsel of the defendant's choosing and
| | | | | | | | | | | | | |
to freely communicate with counsel
| | | |
- The right to have accusations and the procedures explained through a translator
| | | | | | | | | | | |
|for free, if necessary
| | |
- The right to be tried for charges without undue delay
| | | | | | | | | |
- The right to examine or have examined the witnesses against the accused
| | | | | | | | | | | |
- Freedom from testifying against oneself or compelled confessions
| | | | | | | |
Intrusion into an individual's private matters (often referred to as intrusion upon
| | | | | | | | | | | |
seclusion) - CORRECT ANSWER✔✔-a common law invasion of privacy civil wrong
| | | | | | | | | | |
that occurs when an individual intentionally encroaches into an area where
| | | | | | | | | | |
another individual has a reasonable expectation of privacy and the encroachment
| | | | | | | | | |
|would be highly offensive or objectionable to a reasonable person
| | | | | | | | |
Recommendation on Combating Bribery in International Business | | | | | | |
(Recommendation) - CORRECT ANSWER✔✔-published by the Organisation for | | | | | | | |
Economic Co-operation and Development (OECD) in 1994, urges member states
| | | | | | | | | |
to deter and penalize the bribery of foreign public officials by taking "concrete
| | | | | | | | | | | | |
and meaningful steps" to improve the following areas within their respective
| | | | | | | | | | |
infrastructures:
- Criminal, civil, commercial, and administrative laws
| | | | | |
- Tax systems and regulations
| | | |
- Banking and accounting requirements and practices
| | | | | |
