Certified Fraud Examiner (CFE)

What Is a Certified Fraud Examiner (CFE)?

A Certified Fraud Examiner (CFE) is a professional certification available to fraud examiners. CFEs are subject to periodic continuing professional education requirements (CPE) in the same manner as CPAs.

The CFE designation is issued by the Association of Certified Fraud Examiners (ACFE), the world's largest anti-fraud organization, based in Austin, Texas. 

Key Takeaways

  • A Certified Fraud Examiner (CFE) is a professional certification available to fraud examiners by the world's largest anti-fraud organization.
  • CFE applicants must have at least two years of experience, and have 50 points based on experiences like education and professional affiliations.
  • Candidates must also pass a certification exam to receive the CFE designation.
  • To maintain the credential, there is a continuing education requirement.
  • CFEs have a wide range of career options, and the Bureau of Labor Statistics estimates that the employment of financial examiners, such as CFEs, will increase 18% from 2020 to 2030.

Understanding the Certified Fraud Examiner (CFE) Certificate

Certified fraud examiners are required to have a bachelor's degree (or equivalent)—no specific field is required—and at least two years of "professional experience in a field related to the detection or deterrence of fraud." Acceptable fields include auditing, loss prevention, law, and accounting. Qualifying is done according to a points system that awards credit for education, professional affiliations, and experience. Applicants must have 50 points and pass a certification exam to receive the CFE designation. 

CFEs are subject to a code of ethics. For example, Harry Markopolos, the outside investigator who repeatedly warned the Securities and Exchange Commission (SEC) about Bernie Madoff's Ponzi scheme—to no avail—was a CFE. So is whistleblower David P. Weber, the former SEC assistant inspector general who stated that former SEC Inspector General David Kotz had personal relationships that tainted the SEC investigation of that scandal.

Steps to Becoming a Certified Fraud Examiner

In order to qualify, candidates must also meet the following five criteria:

  • must be an Associate Member of the ACFE
  • have a minimum of 40 points in the eligibility points system to take the CFE Exam and a minimum of 50 points to be certified
  • have at least two years of professional experience in a field related to the detection or deterrence of fraud
  • pass the CFE Exam
  • agree to abide by the ACFE’s bylaws and Code of Professional Ethics

The CFE Exam

The CFE Exam is taken on a proctored computer system, and consists of four sections: Financial Transactions and Fraud Schemes, Law, Investigation and Fraud Prevention and Deterrence.

Test takers have two hours to complete each section of the CFE Exam. Although the total exam time is therefore eight hours, each section of the exam can be taken separately as long as all sections are completed within 60 days.

CFEs earn 34% more than their non-certified colleagues.

 Maintaining Your CFE Credential

CFEs are also required to complete continuing education. According to the ACFE website, "Certified Fraud Examiners (CFEs) need to stay current in the profession by completing Continuing Professional Education (CPE). CFEs must obtain a minimum of 20 CPE credits each year; at least 10 of these must relate directly to the detection and deterrence of fraud and two must relate directly to ethics." The ACFE will allow an extension if a CFE is unable to meet their deadline.

In 1792, the first financial fraud was prosecuted in the United States. The secretary of the Treasury, Alexander Hamilton, rebuilt the finance industry by replacing outstanding bonds with bonds from the U.S. bank. The assistant secretary of the Treasury, William Duer, was given access to classified Treasury information. He alerted his friends about classified information before unveiling it to the public, and he knew it would increase the bond prices. Then, Duer sold the bonds for a profit. Hamilton spared the bond market by buying up bonds and acting as a lender. The 1792 bond crisis and the large volume of bond trading were the sparks for the Buttonwood Agreement, which started the New York Stock Exchange (NYSE).

CFE Career Outlook

CFEs have a wide range of career options. Typical jobs include forensic accountant, internal/external auditor, compliance officer, state or private investigator, and law enforcement. A CFE can move into an executive position, such as a special agent, an inspector general, a chief compliance officer, a chief risk officer, or a chief audit executive. 

The ACFE estimates that occupational fraud cost organizations worldwide over $4.7 trillion a year. New and changing regulations—and the development of the Consumer Financial Protection Bureau (CFPB)—have increased the employment of fraud examiners. The Bureau of Labor Statistics projects the employment of financial examiners, which involves the type of work done by CFEs ("ensure compliance with laws that govern institutions handling monetary transactions."), to increase 18% from 2020 to 2030.

What Does a Certified Fraud Examiner Do?

A certified fraud examiner is a credentialed anti-fraud professional involved in discovering, investigating, and resolving fraud cases.

How Much Does the CFE Certification Cost?

The cost to take the CFE Exam is $450. If you purchased the CFE Exam Prep Course, a $100 credit on the cost of the CFE Exam fee will be applied, reducing the CFE Exam fee to $350. The full price of the CFE Exam Prep Course is $1,062. Members receive a discounted price of $849.60.

What Happens If You Fail the CFE Exam?

To pass the exam you need a passing score of 75% or higher in each section. If you fail a section you can retake it (with a $100 retake fee per failed section).  You must, however, pass each section of the exam within three attempts.

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