CFE – Fraud Prevention and Deterrence — Question 34

Which of the following is FALSE regarding an organization’s anti-fraud policy?

Answer options

• A. In developing the anti-fraud policy, management should check with legal counsel regarding any legal considerations with respect to the policy
• B. One of the most important considerations in developing the anti-fraud policy is to ensure every allegation is handled in a uniform manner
• C. To avoid legal problems in discharging employees, the anti-fraud policy should not include any specific examples of fraud and misconduct
• D. A detailed anti-fraud policy can make it easier to investigate and punish employees who commit fraud and other dishonest acts

Correct answer: A

Explanation

Option A is incorrect because it is essential for management to consult legal counsel when developing an anti-fraud policy to ensure compliance with legal standards. The other options highlight important aspects of the policy, such as uniform handling of allegations (B), the avoidance of legal issues by not detailing fraud examples (C), and the benefits of a detailed policy for investigations (D).