Certified Fraud Examiner
|This article relies too much on references to primary sources. (February 2008)|
The Certified Fraud Examiner (CFE) is a credential awarded by the Association of Certified Fraud Examiners (ACFE). The ACFE association is the world's largest anti-fraud organization and premier provider of anti-fraud training and education. Together with more than 75,000 members, the ACFE is reducing business fraud world-wide and inspiring public confidence in the integrity and objectivity within the profession. CFEs have a unique set of skills that are not found in any other career field or discipline; they combine knowledge of complex financial transactions with an understanding of forensic methods, law, and how to resolve allegations of fraud. Fraud examiners are also trained to understand not only how fraud occurs, but why.
In order to become a Certified Fraud Examiner (CFE) one must meet the following requirements:
- Be an Associate Member of the ACFE in good standing
- Meet minimum academic and professional requirements (Undergraduate Degree + Masters Degree or Professional Designation(s) and Professional Experience)
- Be of high moral character
- Agree to abide by the Bylaws and Code of Professional Ethics of the Association of Certified Fraud Examiners
Generally, applicants for CFE certification have a minimum of a bachelor's degree or equivalent from an institution of higher education. Two years of professional experience related to fraud can be substituted for each year of college.
At the time of certification, at least two years of professional experience in a field either directly or indirectly related to the detection or deterrence of fraud is required. The ACFE recognizes the following areas as qualified professional experience:
- Accounting and auditing
- Criminology and sociology (sociology is acceptable only if it relates to fraud.)
- Fraud investigation
- Loss prevention (experience as a security guard or equivalent is not acceptable)
- Law relating to fraud
Other experience can qualify, but must be reviewed for applicability.
The ACFE will require references attesting to one's character before granting the certificate.
Adhere to the Code of Ethics
Per the ACFE website, the code of ethics states that a Certified Fraud Examiner shall:
- Demonstrate a commitment to professionalism and diligence in his or her duties.
- Not engage in any illegal or unethical conduct, or any activity which constitutes a conflict of interest.
- Exhibit the highest level of integrity in the performance of all professional assignments and will accept only assignments for which there is reasonable expectation that the assignment will be completed with professional competence.
- Comply with lawful orders of the courts and testify to matters truthfully and without bias or prejudice.
- Obtain evidence or other documentation to establish a reasonable basis for any opinion rendered. No opinion shall be expressed regarding the guilt or innocence of any person or party.
- Not reveal any confidential information without proper authorization.
- Reveal all pertinent material matters discovered during the course of an examination.
- Continually strive to increase the competence and effectiveness of professional services performed under his or her direction.
The CFE Exam consists of 500 questions divided into four sections: Fraud Examination and Investigation, Criminology and Ethics, Financial Transactions, and Legal Elements of Fraud. Each question has a time limit of 75 seconds, and each section contains 125 questions.
The CFE Exam covers the following four areas:
- Fraud Prevention and Deterrence - Tests your knowledge of why people commit fraud and what can be done to prevent it. Topics covered in this section include crime causation, white-collar crime, occupational fraud, fraud prevention, fraud risk assessment, and the ACFE Code of Professional Ethics.
- Financial Transactions - This section tests your knowledge of the types of fraudulent financial transactions incurred in accounting records. To pass this section, you will be required to demonstrate knowledge of these concepts: basic accounting and auditing theory, fraud schemes, internal controls to deter fraud and other auditing and accounting matters.
- Fraud Investigation - This section includes questions in the following areas: interviewing, taking statements, obtaining information from public records, tracing illicit transactions, evaluating deception and report writing.
- Legal Elements of Fraud - This section ensures that you are familiar with the many legal ramifications of conducting fraud examinations, including criminal and civil law, rules of evidence, rights of the accused and accuser and expert witness matters.
- Cynthia Cooper, whistle blower of the WorldCom accounting scandal
- Joseph Gutheinz, Omniplan Task Force Leader, largest count conviction in NASA history
- Harry Markopolos, whistle blower of the Bernard Madoff scandal
- David P. Weber, former U.S. Securities and Exchange Commission (SEC) Chief Investigator, and whistle blower.
- Joseph T. Wells, founder and chairman of the Association of Certified Fraud Examiners