CFE-LAW Online Practice Questions and Answers

Which of the following is the MOST ACCURATE statement about rules prohibiting securities broker-dealers from making unsuitable recommendations on investments or investment strategies?

A. A suitability violation occurs when a broker recommends an investment or investment strategy that is inconsistent with the client's objectives.

B. A suitability violation occurs when a broker does not carry out a trade requested by or promised to a customer.

C. A suitability violation occurs when a broker enters into transactions and manages a client's account for the purpose of generating excessive commissions.

D. A suitability violation occurs when a broker trades in a client's account without obtaining prior approval for making the transaction(s).

Claude stole a large amount of cash from his employer and then deposited the funds into a domestic bank account. Next, he wired the illicit funds to a foreign bank account and engaged in several other transactions using foreign accounts to make them difficult to trace. Finally, he transferred the funds back to a domestic account and then spent the money. Which of the following actions was the layering stage of Claude's money laundering scheme?

A. When he first deposited the funds into a domestic account

B. When he spent the money

C. When he moved the funds through several transactions using foreign accounts

D. When he first stole the cash from his employer

One of the purposes of securities regulation is to maintain market confidence.

A. True

B. False

Dodd is a Certified Fraud Examiner (CFE) who works for ABC Company, a private company. Dodd suspects that Burton, an ABC Company employee, has embezzled money from the company. Dodd plans to conduct an internal investigation into the missing funds. Based on these facts, which of the following is the MOST ACCURATE statement?

A. Burton can refuse to cooperate with the investigation because he has a fundamental right to privacy.

B. Burton can refuse to cooperate with the investigation because he has a fundamental right to remain silent.

C. Burton likely has a duty to cooperate with the investigation as part of the employer-employee relationship.

D. Burton has a duty to cooperate with the investigation even if what is requested from him is not reasonable.

Which of the following is a legal element that the government must show to prove a criminal conspiracy?

A. The defendant knew all the details or objectives of the conspiracy.

B. The defendant knew the identity of all the participants in the conspiracy.

C. One of the conspirators knowingly committed an overt act in furtherance of the conspiracy.

D. The conspirators accomplished the purpose of the conspiracy that was initially established.

In systems using adversarial processes, an attorney may impeach an opposing party's witness by showing that the witness:

A. Made prior consistent statements

B. Is influenced by bias or self-interest

C. Has a keen ability to observe

D. Testified from personal knowledge

Which of the following statements is TRUE regarding criminal proceedings and discovery in adversarial jurisdictions?

A. The judge is the primary driver of the discovery process in criminal proceedings.

B. Parties typically cannot request evidence from each other until after the trial begins.

C. The majority of criminal discovery usually occurs before the trial begins.

D. Most criminal proceedings are divided into pretrial, investigative, and trial phases.

Which of the following statements concerning the appointment of expert witnesses at trial is accurate?

A. Generally, the court selects the primary expert witnesses in adversarial jurisdictions.

B. Generally, only the parties may select expert witnesses in inquisitorial jurisdictions.

C. Generally, the court appoints the primary expert witnesses in inquisitorial jurisdictions.

D. Generally, only the parties may select experts to introduce testimony in adversarial jurisdictions.

During a trial in an adversarial system, an attorney calls an expert witness to the stand and asks, "Could you please describe the procedures you performed in your examination?" Based on this question, which type of testimony is MOST LIKELY being presented?

A. Request for admission

B. Cross-examination

C. Impeachment

D. Direct examination

In a particular country's judicial process, the judge oversees the investigation of a case, is primarily

responsible for questioning witnesses, and generally plays a larger role in the evidence-gathering process

than the parties' legal counsel.

Which of the following best describes this type of judicial process?

A. Substantive law process

B. Common law process

C. Inquisitorial process

D. Adversarial process