First, Alma begins by suggesting that Korihor is not only wrong about the Nephite priests practicing priestcraft, but that Korihor knows that this is incorrect. There is something about Korihor that allows Alma to suggest that he has sufficient prior knowledge of the Nephite priests that he would know that they do not do that which he accuses them. This would appear to indicate that Alma knows that Korihor is either an apostate Nephtie, or at least someone who has lived for a fairly long time among the Nephites. Since we hear of Korihor coming to the land (verse 6) it would appear that Korihor had been brought up Nephite, apostatized or defected to the Lamanites, and is just now returning on his missionary effort.
The next question asks whether or not Korihor can make such accusations in the face of the evidence of the result of the Nephite preaching. Alma is using the same concept suggested in the New Testament:
Matthew 7:16-20
16 Ye shall know them by their fruits. Do men gather grapes of thorns, or figs of thistles?
17 Even so every good tree bringeth forth good fruit; but a corrupt tree bringeth forth evil fruit.
18 A good tree cannot bring forth evil fruit, neither can a corrupt tree bring forth good fruit.
19 Every tree that bringeth not forth good fruit is hewn down, and cast into the fire.
20 Wherefore by their fruits ye shall know them.
Alma reminds Korihor that the efforts of the priests has brought much joy to the hearts of the people. As the fruit if their preaching, Alma is asking how such a great fruit could be evidence of bad practices or priests. In spite of this, Korihor reaffirms his accusation.