I'd be very sceptical about this alleged test, sounds a bit made up to me or at least not the whole story.
A wouldn't expect a PPL FE to resort to "setting traps" at all and certainly nothing of the nature described. I'm UK based so this might not be exactly the same in NZ, but the candidate is not PIC on the test the FE is. The student will log the test as PUT if unsuccessful and P1S if they pass, so any unauthorised entry into CAS would be their problem, not the student's. Can't see any examiner putting themselves in line for a infringement bo*****ing just to prove a point.