CFE – Fraud Prevention and Deterrence — Question 1

Which of the following statements is FALSE regarding an organization's fraud risk management program?

Answer options

• A. A specific individual or team should be designated as responsible for monitoring compliance with the program
• B. Formal sanctions for intentional noncompliance should be determined and enacted privately
• C. The punishment for intentional noncompliance should be carried out in a consistent and firm manner
• D. The program must include mechanisms to address breaches in compliance

Correct answer: A

Explanation

Option A is correct because it is essential for a specific individual or team to be designated to oversee compliance, ensuring accountability. Options B and C are incorrect as sanctions should be transparent and consistently enforced to deter fraud, and option D is also incorrect because addressing breaches is a critical component of an effective fraud risk management program.