ACFE-Law UPDATED EXAM Questions And
CORRECT Answers
U.S. Securities Exchange Act of 1934 (the Exchange Act) - CORRECT ANSWERS to regulate
the subsequent trading of securities through brokers and exchanges.
Responsibilities of a U.S. bankruptcy judge - CORRECT ANSWERS Conducting hearings and
trials
Awarding fees to professionals
Hearing all cases regarding debtors' and creditors' rights
U.S. Trustee Program (DOJ) - CORRECT ANSWERS Responsible for administering
bankruptcy cases; Appointing Chapter 11 committees;
Overseeing and monitoring trustees;
Reviewing employment and fee applications; and Appearing in court on matters of interest to
the estate and creditors.
Examiner - CORRECT ANSWERS neutral party appointed by the bankruptcy court to
investigate and report on relevant matters to Chapter 11 bankruptcy cases
Bustout - CORRECT ANSWERS planned and fraudulent bankruptcy
Chapter 7 bankruptcy - CORRECT ANSWERS liquidation of the debtor's property to pay
creditors and the discharging of the debtor's dischargeable debts.
liquidation proceeding - CORRECT ANSWERS involved in a Chapter 7 case, is the most
basic type of bankruptcy and involves accounting for all dischargeable debts the subject owes,
identifying all of the subject's assets, and liquidating nonexempt assets to pay off creditors.
, concealed assets scheme - CORRECT ANSWERS concealment of assets rightfully belonging
to the debtor's estate to avoid forfeiting the assets in bankruptcy
Trustee - CORRECT ANSWERS duties of the trustee are as follows: administer assets of the
estate; liquidate assets; pay creditors; litigate matters where necessary; have the right to sue
and be sued; conduct hearings; conduct investigations of the debtor's financial affairs; file
reports as required by the U.S. Trustee Program (USTP); and, where appropriate, file criminal
referrals with the U.S. Attorney's Office
Lack of tax deficiency - CORRECT ANSWERS the best defense against the notice, assuming
the facts will support the defense
tax evasion - CORRECT ANSWERS refers to any fraudulent actions that a taxpayer commits
to avoid reporting or paying taxes
Tax avoidance - CORRECT ANSWERS refers to a legal means of lowering one's tax bill
through legitimate deductions, credits, and shelters.
Internal Revenue Service - CORRECT ANSWERS pursues civil violations
Department of Justice - CORRECT ANSWERS pursues criminal tax cases for prosecution
investment contract - CORRECT ANSWERS a contract, transaction or scheme whereby a
person invests his money in a common enterprise and is led to expect profits solely from the
efforts of" someone other than the investor.
Howey test - CORRECT ANSWERS There is an investment of money or other asset.
CORRECT Answers
U.S. Securities Exchange Act of 1934 (the Exchange Act) - CORRECT ANSWERS to regulate
the subsequent trading of securities through brokers and exchanges.
Responsibilities of a U.S. bankruptcy judge - CORRECT ANSWERS Conducting hearings and
trials
Awarding fees to professionals
Hearing all cases regarding debtors' and creditors' rights
U.S. Trustee Program (DOJ) - CORRECT ANSWERS Responsible for administering
bankruptcy cases; Appointing Chapter 11 committees;
Overseeing and monitoring trustees;
Reviewing employment and fee applications; and Appearing in court on matters of interest to
the estate and creditors.
Examiner - CORRECT ANSWERS neutral party appointed by the bankruptcy court to
investigate and report on relevant matters to Chapter 11 bankruptcy cases
Bustout - CORRECT ANSWERS planned and fraudulent bankruptcy
Chapter 7 bankruptcy - CORRECT ANSWERS liquidation of the debtor's property to pay
creditors and the discharging of the debtor's dischargeable debts.
liquidation proceeding - CORRECT ANSWERS involved in a Chapter 7 case, is the most
basic type of bankruptcy and involves accounting for all dischargeable debts the subject owes,
identifying all of the subject's assets, and liquidating nonexempt assets to pay off creditors.
, concealed assets scheme - CORRECT ANSWERS concealment of assets rightfully belonging
to the debtor's estate to avoid forfeiting the assets in bankruptcy
Trustee - CORRECT ANSWERS duties of the trustee are as follows: administer assets of the
estate; liquidate assets; pay creditors; litigate matters where necessary; have the right to sue
and be sued; conduct hearings; conduct investigations of the debtor's financial affairs; file
reports as required by the U.S. Trustee Program (USTP); and, where appropriate, file criminal
referrals with the U.S. Attorney's Office
Lack of tax deficiency - CORRECT ANSWERS the best defense against the notice, assuming
the facts will support the defense
tax evasion - CORRECT ANSWERS refers to any fraudulent actions that a taxpayer commits
to avoid reporting or paying taxes
Tax avoidance - CORRECT ANSWERS refers to a legal means of lowering one's tax bill
through legitimate deductions, credits, and shelters.
Internal Revenue Service - CORRECT ANSWERS pursues civil violations
Department of Justice - CORRECT ANSWERS pursues criminal tax cases for prosecution
investment contract - CORRECT ANSWERS a contract, transaction or scheme whereby a
person invests his money in a common enterprise and is led to expect profits solely from the
efforts of" someone other than the investor.
Howey test - CORRECT ANSWERS There is an investment of money or other asset.
