CFCI Certified Financial Crimes Investigator - Exam Prep, Practice Questions & Verified Answers
According to the ACFE, what is fraud? Illegal acts characterized by deceit, concealment, or violation of trust.
How does the AICPA define fraud compared to error? Fraud is distinguished from error by whether the action is intentional.
What two core categories encompass nearly all fraudulent Theft and Deception.
activity?
What percentage of overall frauds are committed by Approximately 67%.
insiders according to Kroll?
How does internal fraud differ from external fraud? Internal fraud is committed by employees; external is committed by outsiders.
Define embezzlement in legal terms. Conversion of title by misappropriating assets lawfully in one's possession.
How does larceny differ from embezzlement? Larceny involves taking property without ever having lawful possession.
What internal control failure allowed the $30M Koss Entrusting all financial activities to a single unsupervised individual.
Corporation embezzlement?
What is financial statement fraud commonly called? Cooking the books.
What audit discipline is required to investigate financial Forensic accounting and specialized financial statement analysis.
reporting fraud?
What is skimming in accounts receivable? Stealing cash before it is recorded in the accounting system.
What is a shell company billing scheme? Creating a fake vendor to submit bogus invoices for personal gain.
Which internal control helps detect matching vendor and Data analytic audit tests.
employee addresses?
Stuvia 2026-2027
, CFCI Certified Financial Crimes Investigator - Exam Prep, Practice Questions & Verified Answers
What is Positive Pay? An anti-check fraud service matching presented checks against an issued list.
What characterizes an employee reimbursement scheme? Submitting inflated, fictitious, or duplicate business expense claims.
What is the key difference between bribery and an illegal Bribery influences future decisions; gratuities reward past decisions.
gratuity?
What does the Foreign Corrupt Practices Act (FCPA) Bribing foreign government officials to obtain or retain business.
prohibit?
What is passive bribery as defined by the 2010 UK Bribery The act of requesting, agreeing to receive, or accepting a bribe.
Act?
How can an effective compliance program benefit a It can reduce penalties and lead to deferred or non-prosecution agreements.
company under FCPA enforcement?
What is a kickback scheme? A corrupt arrangement where an employee receives a portion of inflated vendor
invoices.
What is a credit card bust-out scheme? Opening card accounts using stolen/fake identity, maxing credit lines, and
abandoning debt.
What primary security technology reduced counterfeit card EMV chip-and-PIN technology.
fraud in retail transactions?
What shift in card fraud occurred after the introduction of Fraud shifted heavily online to Card-Not-Present (CNP) transactions.
EMV chips?
What are nominee loans in financial fraud? Loans made to bogus straw borrowers to secretly funnel money to insiders.
What is a 'liar's loan' in mortgage lending? A stated-income loan approved without verifying income, assets, or employment.
What main regulatory act was passed in 2010 to reform Dodd-Frank Wall Street Reform and Consumer Protection Act.
Wall Street?
What provision in Dodd-Frank restricts banks from The Volcker Rule.
proprietary trading?
Average percentage of gross annual revenue Five percent.
organizations lose to fraud worldwide:
Stuvia 2026-2027
, CFCI Certified Financial Crimes Investigator - Exam Prep, Practice Questions & Verified Answers
What is the single most common method by which Whistleblower tips.
organizational fraud is detected?
What percentage of detected fraud cases originate from Over 40 percent.
tips?
By what percentage can entity-wide fraud awareness By 41 percent.
training cut fraud losses?
Average loss per financial reporting fraud vs asset $800,000 for financial reporting vs $114,000 for asset misappropriation.
misappropriation incident:
How long does the average fraud scheme go undetected? An average of 16 months.
What is Business Email Compromise (BEC)? Social engineering scams impersonating executives/vendors via email to transfer
funds.
Why is 'We have very little fraud here' considered a Unmonitored assumptions allow undetected fraud to cause massive financial harm.
dangerous myth?
Why does standard ethics training fail to prevent financial Ethics training targets general workplace behavior, not specific fraud detection/red
fraud? flags.
Are unethical workplace actions always illegal frauds? No; while all fraud is unethical, not all unethical behavior violates criminal law.
According to research, what proportion of employees are About 80 percent.
fundamentally honest?
Explain the 20-60-20 rule regarding workplace honesty. 20% never steal, 60% might steal if pressured/given opportunity, 20% seek to steal.
How do management-level frauds compare to employee- Management frauds occur less frequently but cause vastly higher financial losses.
level frauds in financial impact?
Who developed the Fraud Triangle theory in the 1940s? Criminologist Donald Cressey.
What term did Cressey use to describe individuals who Trust violators.
embezzle?
What are the three sides of the Fraud Triangle? Pressure, Opportunity, and Rationalization.
Stuvia 2026-2027
According to the ACFE, what is fraud? Illegal acts characterized by deceit, concealment, or violation of trust.
How does the AICPA define fraud compared to error? Fraud is distinguished from error by whether the action is intentional.
What two core categories encompass nearly all fraudulent Theft and Deception.
activity?
What percentage of overall frauds are committed by Approximately 67%.
insiders according to Kroll?
How does internal fraud differ from external fraud? Internal fraud is committed by employees; external is committed by outsiders.
Define embezzlement in legal terms. Conversion of title by misappropriating assets lawfully in one's possession.
How does larceny differ from embezzlement? Larceny involves taking property without ever having lawful possession.
What internal control failure allowed the $30M Koss Entrusting all financial activities to a single unsupervised individual.
Corporation embezzlement?
What is financial statement fraud commonly called? Cooking the books.
What audit discipline is required to investigate financial Forensic accounting and specialized financial statement analysis.
reporting fraud?
What is skimming in accounts receivable? Stealing cash before it is recorded in the accounting system.
What is a shell company billing scheme? Creating a fake vendor to submit bogus invoices for personal gain.
Which internal control helps detect matching vendor and Data analytic audit tests.
employee addresses?
Stuvia 2026-2027
, CFCI Certified Financial Crimes Investigator - Exam Prep, Practice Questions & Verified Answers
What is Positive Pay? An anti-check fraud service matching presented checks against an issued list.
What characterizes an employee reimbursement scheme? Submitting inflated, fictitious, or duplicate business expense claims.
What is the key difference between bribery and an illegal Bribery influences future decisions; gratuities reward past decisions.
gratuity?
What does the Foreign Corrupt Practices Act (FCPA) Bribing foreign government officials to obtain or retain business.
prohibit?
What is passive bribery as defined by the 2010 UK Bribery The act of requesting, agreeing to receive, or accepting a bribe.
Act?
How can an effective compliance program benefit a It can reduce penalties and lead to deferred or non-prosecution agreements.
company under FCPA enforcement?
What is a kickback scheme? A corrupt arrangement where an employee receives a portion of inflated vendor
invoices.
What is a credit card bust-out scheme? Opening card accounts using stolen/fake identity, maxing credit lines, and
abandoning debt.
What primary security technology reduced counterfeit card EMV chip-and-PIN technology.
fraud in retail transactions?
What shift in card fraud occurred after the introduction of Fraud shifted heavily online to Card-Not-Present (CNP) transactions.
EMV chips?
What are nominee loans in financial fraud? Loans made to bogus straw borrowers to secretly funnel money to insiders.
What is a 'liar's loan' in mortgage lending? A stated-income loan approved without verifying income, assets, or employment.
What main regulatory act was passed in 2010 to reform Dodd-Frank Wall Street Reform and Consumer Protection Act.
Wall Street?
What provision in Dodd-Frank restricts banks from The Volcker Rule.
proprietary trading?
Average percentage of gross annual revenue Five percent.
organizations lose to fraud worldwide:
Stuvia 2026-2027
, CFCI Certified Financial Crimes Investigator - Exam Prep, Practice Questions & Verified Answers
What is the single most common method by which Whistleblower tips.
organizational fraud is detected?
What percentage of detected fraud cases originate from Over 40 percent.
tips?
By what percentage can entity-wide fraud awareness By 41 percent.
training cut fraud losses?
Average loss per financial reporting fraud vs asset $800,000 for financial reporting vs $114,000 for asset misappropriation.
misappropriation incident:
How long does the average fraud scheme go undetected? An average of 16 months.
What is Business Email Compromise (BEC)? Social engineering scams impersonating executives/vendors via email to transfer
funds.
Why is 'We have very little fraud here' considered a Unmonitored assumptions allow undetected fraud to cause massive financial harm.
dangerous myth?
Why does standard ethics training fail to prevent financial Ethics training targets general workplace behavior, not specific fraud detection/red
fraud? flags.
Are unethical workplace actions always illegal frauds? No; while all fraud is unethical, not all unethical behavior violates criminal law.
According to research, what proportion of employees are About 80 percent.
fundamentally honest?
Explain the 20-60-20 rule regarding workplace honesty. 20% never steal, 60% might steal if pressured/given opportunity, 20% seek to steal.
How do management-level frauds compare to employee- Management frauds occur less frequently but cause vastly higher financial losses.
level frauds in financial impact?
Who developed the Fraud Triangle theory in the 1940s? Criminologist Donald Cressey.
What term did Cressey use to describe individuals who Trust violators.
embezzle?
What are the three sides of the Fraud Triangle? Pressure, Opportunity, and Rationalization.
Stuvia 2026-2027
