ACFE Certified Fraud Examiner (CFE) Financial Transactions and Fraud Schemes 2026 – 400 Free Practice Questions to Pass the Exam

In a fictitious refund scheme, an individual attempts to exploit the return process for fraudulent gain, often by creating fake receipts or returns for items that were never actually purchased. Understanding the implications of such a scheme is critical for identifying and preventing fraud.

The statement regarding that the amount of cash in the register balances with the register log is often true in the context of a fictitious refund scheme. This is because the perpetrator may manipulate records, ensuring that the cash count appears accurate at the end of a shift or period, thus disguising the fraudulent activity. Since the cash is taken out after a fake return and the records are altered to reflect this, it can give the illusion of a legitimate process.

While the other statements may seem plausible at first glance, they do not reflect the typical dynamics of a fictitious refund scheme. For example, inventory is not actually returned to the store since the scheme involves returns of non-existent purchases, which means the physical inventory status remains unaffected directly. In addition, the victim company's inventory is generally not understated because the fraud doesn't involve real merchandise being brought back; instead, the fake transactions might obscure the actual inventory count but do not lower it.

Thus, the proper understanding of how transactions and inventory interact in a fictitious