ACFE CFE-Investigation - Certified Fraud Examiner (CFE) - Investigation

Observing signs of wealth (sports car, home remodeling) may raise suspicion, but by itself it does not provide sufficient predication to accuse or notify management of fraud. The proper next step is to conduct discreet inquiries to determine if further evidence exists before escalating.

Textual analytics is used to extract investigative insight from unstructured data—communications and documents that are not stored in standard database fields—such as emails, chats, memos, and other narrative text. CFE investigative guidance explains that textual analysis applies linguistic methods and statistical techniques to identify themes, anomalies, and linkages within large volumes of text. Its purpose is not to determine truthfulness or deception with certainty (Option A), because text analytics cannot reliably “detect lies” in a definitive way. Nor is its primary objective to guarantee discovery of a confession (Option B); admissions can appear, but that is not the defining function of the approach. Option C aligns more with flow-of-funds visualization or link/relationship charting for financial movements rather than analyzing language content. Instead, textual analysis is performed to categorize and structure text so patterns, sentiments, recurring topics, and relationships between people and events become visible—helping examiners prioritize leads, identify risk indicators, and focus investigative testing on communications most indicative of potential fraud.

The 2014 International Fraud Examiners Manual states:

“The information contained on a wire transfer generally will include the following items:

• The amount of the transfer

• The date of the transfer

• The name of the sender or originator

• The routing number of the originating bank or financial institution.”

Therefore, the correct answer is C.

The organizational filings with the government of the jurisdiction in which the company is incorporated

Organizational filings (e.g., articles of incorporation) are generally public records and include ownership information, initial shareholders, and the location of the principal office.

The CFE Prep Guide clarifies:

“A fraud response plan outlines the actions… when suspicions of fraud have arisen. Because every fraud is different, the response plan should not outline how a fraud examination should be conducted. Instead, response plans should help organizations manage their responses and create environments to minimize risk and maximize the potential for success”.

Thus, statement D is false.

“Introductory questions should be designed to establish rapport… the interviewer must establish some common ground with the respondent before he begins the fact-gathering portion of the interview. Interviewers usually establish rapport by spending a few minutes with the respondent in an informal dialogue”.

Thus, Vishal’s small talk about ties and sports is rapport-building.

Body language alone (e.g., avoiding eye contact) cannot be taken as proof of deception. The Manual warns against drawing conclusions from a single behavioral cue:

“Avoiding eye contact is not directly linked to deception. Such behavior could stem from cultural norms, nervousness, or personality traits. Examiners should consider clusters of behavior, context, and corroborating evidence before concluding deception”.

Therefore, C is correct.

Link analysis is described as a visual analytic tool that:

“Tracks the movement of money,”

“Demonstrates complex networks,”

“Helps identify indirect relationships with several degrees of separation,” and

“Discovers communications, patterns, and trends.”

It does not display financial ratios—that belongs to traditional financial statement/ratio analysis.

The manual states:

“When seizing a computer that is running, the party seizing the system should not, in most situations, search the computer for evidence because doing so might damage and taint relevant evidence.”

Thus, B is the least accurate statement.

The best practices for signed statements include:

Adding omitted facts as an addendum.

Preparing separate statements for unrelated offenses.

Having witnesses to the signing.

But:

“The signed statement should be reduced to a short and concise written statement. The interviewer should prepare the statement and present it to the confessor for his signature” .

Thus, requiring the suspect to handwrite the entire statement is not a best practice.