CFE Ethical Obligations & Professional Conduct 4

Question 1

A CFE learns during an engagement that the client is engaged in ongoing money laundering. The CFE should first:

Accepted Answer

Consult with legal counsel about reporting obligations and disengage if necessary

Answer

Upon discovering ongoing crimes, a CFE should consult legal counsel to understand reporting obligations and consider withdrawing from the engagement.

Question 2

Which situation most clearly represents a violation of the CFE's duty of due diligence?

Accepted Answer

Failing to follow up on red flags identified during fieldwork

Answer

Ignoring identified red flags without follow-up is a failure of due diligence and violates the CFE's professional standards.

Question 3

Under the ACFE's ethical framework, a CFE who is also an attorney must:

Accepted Answer

Comply with both sets of standards, with stricter rules governing

Answer

A CFE who is also an attorney must comply with both the ACFE Code and bar association rules, adhering to whichever imposes the stricter obligation.

Question 4

A CFE is pressured by a client to exclude an unfavorable finding from a report. The ethical response is to:

Accepted Answer

Include the finding or withdraw from the engagement

Answer

A CFE must include all material findings or withdraw from the engagement; omitting them at a client's request compromises professional integrity.

Question 5

The concept of 'independence in appearance' for a CFE means:

Accepted Answer

Avoiding situations that would cause a reasonable person to question objectivity

Answer

Independence in appearance means avoiding relationships or circumstances that could lead a reasonable observer to doubt the CFE's objectivity.

(CFE) Certified Forensic Examiner Practice Test