Fakin' The Funk first reads the header of the file, which contains (among other things) the total length of the song. Then it scans through the audio frames and calculates the actual song length. If there is a mentionable difference in these two values, the file will be marked as corrupted.
In some cases, this is only a "bug" in the header. In other cases it happens that the song simply stops in the middle of playing.
The settings dialog offers an option to search for clipping and define a "tolerance level". If too many samples are clipping, then it will be marked as corrupted.
3) Silent parts
The settings dialog offers an option to detect silent parts longer than x seconds. When such a pause is detected, the file will be marked as corrupted.