Achieving the Certified Fraud Examiner Certification

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Achieving the Certified Fraud Examiner
Certification
Jerry W. Rainwaters, CIA, CFE, CISA, CISSP ASMC
Mini-PDC March 29, 2005
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What is the ACFE?

• Global professional association providing
  anti-fraud information education to help
  members fight fraud effectively
• 32,000 members in over 110 countries dedicated to
  fighting fraud
• 103 local chapters providing education, outreach
  and networking opportunities
• 50 of members are Certified Fraud Examiners,
  others are associate members

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What is the CFE?

• The Certified Fraud Examiner
• A Certified Fraud Examiner (CFE) is a leader in
  the anti-fraud community, noted as a specialist
  in the prevention and detection of fraud.

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Becoming a CFE?

• At the time you are certified, you must have at
  least two years of professional experience in a
  field either directly or indirectly related to
  the detection or deterrence of fraud.
• Becoming a CFE requires specific qualifications.
• A simple 4 Step Process
• 1. Be an Associate member of the ACFE in good
  standing.
• If you are not already an Associate member of the
  ACFE, you must first become one in order to
  pursue the CFE designation.

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Becoming a CFE (contd)?

• 2. Submit the certification application with
  proof of education and professional
  recommendations.
• 3. Pass the CFE Examination.
• The CFE Examination is a self-administered,
  Windows-based program that tests your knowledge
  and expertise in the four primary areas of fraud
  investigation Fraudulent Financial Transactions,
  Legal Elements of Fraud, Fraud Investigation, and
  Criminology and Ethics.
• 4. Gain final approval from the certification
  committee and become a CFE.
• You will officially become a CFE once your exam
  and credentials are approved by the certification
  committee. Those who have attained the CFE
  designation will be invoiced at the CFE dues rate
  upon annual membership renewal. CFE membership
  dues are US 150.00 annually.

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Becoming a CFE (contd)?

• Provide proof of your education in one of the
  following ways
• A photocopy of transcripts or diploma
  certificates for any degrees earned and
  professional certifications acquired
• A letter from the registrar of your academic
  institution verifying your completion of degree.
• A combination of documents that forms a complete
  record of your education. These documents may
  include
• Marksheets
• Syllabi
• Length of the academic year
• Number of hours spent in class for each course
  taken.
• Grading scale (minimum and maximum grades
  possible).
• Courses taken and grades earned for each course
  OR
• Lists of examinations taken plus marks earned in
  each examination.
• Indications of the receipt of a degree.

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Becoming a CFE (contd)?

• Three letters of professional recommendation are
  required to be submitted along with your
  application. All professional recommendation
  letters must be written in English or translated
  to English. The letters must be individually
  written by someone who has worked with you in a
  professional manner and should include the
  following
• An anecdotal description of your working
  relationship
• Details of your professional background
• Comments on your character, integrity, and
  professional skills
• A recommendation for you to become a CFE

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CFE Exam

• The CFE Exam covers the following four
  topics/areas
• Criminology Ethics - The purpose of this
  section is to test your knowledge of
  criminological concepts and to evaluate your
  understanding of the underlying ethics of the
  fraud examination profession. This part includes
  administration of criminal justice, theories of
  crime causation, theories of fraud prevention,
  crime information sources, and ethical
  situations.
• 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. Details of your
  professional background

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CFE Exam (contd)

• 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.

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CFE Exam (contd)

• Taking the CFE exam
• You may take the CFE Exam any time during the
  year.
• When you are prepared to take the CFE Exam,
  simply request the exam via email at
  exam_at_CFEnet.com. If you have studied with the CFE
  Exam Prep Course, you already have the exam that
  corresponds to your Prep Course installed on your
  computer, and we will send you the code to open
  it on your computer. If you have studied on your
  own with the Fraud Examiners Manual , we will
  send you a disk containing the exam.
• How much time will I need to take the CFE Exam?
• It will take a total of 10 hours to complete the
  exam. Each section is allocated a maximum of 2.6
  hours to complete. Each of the four exam sections
  has 125 questions and you will have a maximum of
  75 seconds to answer each question.
• You have 30 days to complete all four sections of
  the CFE Exam and return it to the ACFE for
  grading. You must complete each section in one
  sitting, but you do not have to complete all four
  sections at once.

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CFE CPE

• Continuing Professional Education (CPE)
• The Association of Certified Fraud Examiners, in
  compliance with its bylaws, requires all
  Certified Fraud Examiners to maintain competence
  through Continuing Professional Education (CPE).
• The minimum required is 20 hours per calendar
  year of which at least 10 hours must relate
  directly to the detection and deterrence of
  fraud.
• CPE hours in excess of the minimum requirements
  may not be carried forward to meet the
  requirements of future years. It is important
  that CFEs obtain CPE of at least the minimum
  required amount every year to stay current in
  their profession.
• CFEs have the option to fulfill their CPE
  requirements for their three-year reporting
  period pending as of August 3, 2003 under the
  rules applicable immediately prior to that date,
  in which case the new requirement for 20 hours
  CPE per calendar year would take effect on the
  January 1st following the expiration of that
  three-year reporting period.

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CFE CPE (contd)

• Sources of CPEs
• One hour of credit is equal to at least 50
  minutes of classroom time.
• College courses may be claimed and computed at
  the rate of 15 hours CPE for each semester hour
  completed. Transcripts must be obtained to
  support the claim for CPE hours. In-house
  training is acceptable, provided that it is
  offered in a formalized setting and meets the
  above criteria. Informal, on-the-job training may
  not be claimed.
• Correspondence and self-study courses are
  acceptable for recommended CPE credit provided
  they (1) require a final examination and (2)
  issue certificates of completion.
• In some publications, the acronym CEU is used,
  which means Certified Education Unit. Normally
  one CEU is equal to (1) 15 classroom hours, (2)
  one college semester hour, or (3) 15 hours of
  Continuing Professional Education.

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CFE CPE (contd)

• Sources of CPEs
• Instructor Credit (Maximum 10 CPE Hours/Year)
• Instructors may claim CPE credit for the number
  of hours actually presented plus a maximum of 2
  hours preparation for each hour of presentation
  for the first time the material is presented.
  Subsequent credit for preparation of the same
  presentation is not allowed. Full teaching credit
  may be claimed in every instance the subject is
  taught.
• Author Credit (Maximum 10 CPE Hours/Year)
• Time spent preparing articles and books related
  to the above-mentioned fields will be accepted
  for a maximum of 10 CPE hours per year. A
  detailed description of the book or article
  should be attached to the reporting form.
• Meeting Credit (Maximum 10 CPE Hours/Year)
• Credit for attending certain meetings may be
  claimed for a maximum of 10 hours per year.
  Meetings must either (1) have a formal speaker or
  (2) relate directly to the competence of the
  Certified Fraud Examiner. Meetings must be at
  least 50 minutes in length for each hour claimed.
  Time for lunches, breaks, social gatherings,
  planning sessions, business meetings, and similar
  activities must be excluded.

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FAQs

• What is a Certified Fraud Examiner (CFE)?
• A Certified Fraud Examiner (CFE) is a leader in
  the anti-fraud community, noted as a specialist
  in the prevention and deterrence of fraud. They
  represent the highest standards held by the ACFE
  and possess expertise in all aspects of the
  anti-fraud profession.
• Who sets the standards for CFE certification?
• The standards are set by the ACFE's Board of
  Regents, who are elected by CFE members and drawn
  from our most experienced members.
• Is the CFE credential acknowledged globally?
• Yes. The CFE designation is acknowledged globally
  and preferred by employers. Becoming a CFE
  immediately sets you apart from the competition
  and launches you to the top of your profession.

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FAQs

• Do other entities offer CFE certification?
• No. CFE certification is a unique aspect of the
  ACFE.
• I already hold other certifications. Does this
  qualify me as a CFE as well?
• No. The Certified Fraud Examiner (CFE) is a
  unique designation with its own requirements and
  standards. Your other certifications will be
  counted as part of the qualifying points system
  but will not automatically make you a CFE.
• How do I know if I am eligible to become a CFE?
• Qualifications for becoming a CFE include having
  high moral character and meeting minimum
  professional and academic requirements.

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FAQs

• I want to attain the CFE certification but I
  don't have two years experience. Can I still take
  the exam?
• Yes. You can study for and take the CFE Exam even
  if you do not have two years of practical
  experience, as long as you reach the 40 point
  minimum on Section 2 of the exam application.
  However, please note that you will not become
  officially certified until you do have at least
  two years of practical experience either directly
  or indirectly related to fraud.
• Why do you need letters of recommendation along
  with your application? What should they include?
• In order to maintain the high standards held by
  the ACFE and ensure the integrity of the CFE
  designation, it is important to ensure all
  candidates are of good moral character who will
  be a strong addition to the CFE profession. Pick
  three individuals who will write original letters
  on your behalf. The letters should include an
  anecdotal description of your working
  relationship, details of your professional
  background, comments on your character,
  integrity, and professional skills, and a
  recommendation for you to become a CFE. Form
  letters or those nearly identical in content and
  wording are not accepted.

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FAQs

• When should I turn in my CFE application? Do I
  need to turn in all my documents at once or can I
  send them separately?
• Your exam application and fee must be submitted
  to the ACFE before you can take your exam, but
  you can mail your supporting documentation in
  separately if you wish. We do recommend that you
  mail in all your documents together at least one
  month prior to taking the CFE Exam to allow for
  processing. You will not receive your official
  certification until the Certification Committee
  has evaluated all of your documents and exam
  scores.
• What do you mean when you ask about
  fraud-related experience?
• Fraud-related experience means that you have
  worked full-time in a position that contributes
  to the prevention, detection or deterrence of
  fraud. Fields related to fraud include
  Accounting and Auditing, Criminology or
  Sociology, Fraud Investigation, Loss Prevention
  and Law. If you are unsure if your experience
  qualifies, please submit a brief summary with
  your application for review or click here for a
  more detailed explanation.

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Research Hypothesis vs. Results Compensation

• Hypothesis CFEs earn a compensation premium of
  5-15 compared with non-CFEs in comparable
  positions, due to the value of their anti-fraud
  skills
• Results CFEs earn an average of 28 more!

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Industry of Participants
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Results by Industry
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Results by Industry (continued)
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Compensation Variances by Type of Government
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ACFE Developments

• Grown from 25,000 to 32,000 members in two years
• Admitted 1,680 new CFEs in 2004
• Expanding globally
• Partnering with chapters, state societies of CPAs
  and other organizations to provide high quality
  anti-fraud training worldwide

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Learn More at the Worlds Premier Fraud Conference

• Washington DC July 10-15, 2005.
• 1,500 participants
• 50 sessions, 10 tracks, expert speakers,
  practical ideas, exhibits and fun!
• PCAOB chairman William J. McDonough
• A major crook!
• An anti-fraud hero

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More Information

• ACFE World Headquarters
• www.CFEnet.com
• [phone]/1 [phone]
• Info_at_CFEnet.com
• Main Phone [phone]Email
  chapter_at_cfedc.orgWebsite www.cfedc.org
• DC Washington Metropolitan Chapter
• Jerry W. Rainwaters, President
• 202 565-5826

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More Information

• DC - Washington Metropolitan Area Chapter
• P.O. Box 44640 Washington, DC 20026
  USAPresident Jerry Rainwaters, CFE, CIA,
  CISA, CISSPPhone [phone]Vice-President
  Richard Williams, CFEPhone (703)
  960-6250Secretary May C. Lee, CFE, CPAPhone
  [phone]Treasurer Keith Neus, CFE, CPA
• Phone [phone]