CFE Volume Two Key Notes

Please note that key notes below are highlights of content and areas that you need pay special attention to. It is best to read the official study manual once and start the practice questions immediately to reinforce your learning concepts. Key notes here are compiled based on our experience and candidates feedback that are frequently appeared in the exams.

There are 5 types of law. They are;

  • constitutional law
  • statutory law
  • common law
  • administrative law
  • international law

This law is the body of law that was formed by the sovereignty’s structure and mostly it deal with the basic principles by which the government exercises by it’s power.


This U.S. Constitution and along with it’s reformations are the base of the legal system in the U.S. The Constitution describes and limits the power of the different division of the government and ensure basic rights for the citizens.


This Canadian Constitution shows the summary of the Canada’s system of the government, which provides the basic rules and regulation that govern Canada and it fixes the civil rights of each person living in Canada.


Statutory law is created by the governmental body or other governing authorities which includes codes and statutes passed by the regional. local or any national governmental body.


Common law is made up of the customs and usages of the society which is explained by the judges which is often known as the judge-made law.


Administrative law is based on the agenda and rules of administrative agencies of government. The agency have the power to adjudicate, legislate and imposed  by the laws within their selected area of the delegated power. 


International law consists of regulations, legal rules and practices which are practiced by the country and it also defines the countries legal responsibilities in their administration with each other, transnational companies and private individuals.


Substantive law explains the type of policy which is allowed and the punishment for the violation. This law is created for the basic law rights and duties. 


Procedural law explains the law by which each cases are decided, it explains the rules of the legal system which includes the process which needs to be followed in the hearing a hardship.


In Common Law Systems there are several types of law which judges develop by the decisions of the court, the coded and the statues that have made the laws. According to legislative
statutes, the common law varies from case to case


Civil Law is the law the provides solutions for abusing private rights and civil action is a legal action that doesn’t end up in a criminal fine or imprisonment. 


Adversarial and Inquisitorial Processes is the step that the court takes to find evidence in a case,


Adversarial Processes are the processes which looks for evidences. This approach is used to competing interests of the parties that will reveal the truth regarding the case.


Juries can find both adversarial and inquisitorial jurisdictions opposing jurisdictions actively juries use to find the fact whereas the judge decides the issue of law.


Which court might have the authority over an issue depends on different factors, such as the party’s authority presence where is the court location. A similar issue is that courts must choose which authority laws to apply to different issue in a case.


The following factors most of the courts consider to determine which law to apply;

  • The nationality of the parties to the litigation
  • The current residence of the parties
  • The parties’ current or past physical presence in the relevant jurisdictions
  • The jurisdiction where the transaction or underlying cause of action occurred

Once fraud is discovered, the fraud examiner needs to make recommendation regarding the restoration of the assets that have been lost. In cases where it involves suspects who lives in foreign country is complicated as it is difficult to arrest the suspect and judge them.


Every countries have different types of court systems. Many countries follow tiered court system where there are trial and appellate courts. Courts are defined by the government and venue.


Criminal Actions is a complaint against the criminal by the government acting on behalf of citizens and the interest of the authority, Most of the defendants are classified according to the regulations or statues.


Civil Actions is the opposite of criminal actions.  It is the action of malpractice which does not end up giving fine as a criminal or imprisonment.


Contract Actions is a civil action which is based on contract. A contract is a verbal or written agreement between the two or more people where law will be implemented in any way applicable.  


Civil Wrong is a wrong made in private such as committing fraud which does not cause any legal obligations.


Delict Actions is a liable, wrongful act as it can cause harm and end up in a legal action for the person who have committed the crime.


Fraud includes any types of deliberate or voluntary act to make another person suffer from loss of money or property, by lying or using any other techniques to commit the crime.


The following are the principal types of fraud;

  • Fraudulent misrepresentation of material facts
  • Negligent misrepresentation
  • Concealment of material facts
  • Bribery
  • Illegal gratuity
  • Economic extortion
  • Conflicts of interest
  • Forgery
  • Theft of money or property
  • Breach of contract
  • Breach of fiduciary duty
  • Gross negligence
  • Conspiracy
  • Obstruction of justice
  • Perjury
  • False claims and statements to government agencies

Fraudulent Misrepresentation of Material Facts is mostly though of when the word fraud is used. Misrepresentation cases can be summoned civilly or criminally. 


The following are the elements required to establish a misrepresentation claim;

  • The defendant made a false statement
  • The false statement was material
  • The defendant knew the representation was false.
  • The victim relied on the misrepresentation.
  • The victim suffered damages as a result of the misrepresentation

Negligent Misrepresentation occurs when there is a special relationship that sets a duty on the accused to provide the right information to the prosecutor. 


The following are the essential elements of fraud based on failure to disclose material facts;

  • The defendant had knowledge of a material fact.
  • The defendant had a duty to disclose the material fact.
  • The defendant failed to disclose the material fact.
  • The defendant acted with intent to mislead or deceive the victim(s)