Chapter 1 Multiple Choice – Flashcards

Why does fraud seem to be increasing at such an alarming rate? A. Computers, the Internet, and technology make fraud easier to commit and cover up. B. Most frauds today are detected, whereas in the past many were not. C. A new law requires that fraud be reported within 24 hours. D. People understand the consequences of fraud to organizations and businesses.

Which of the following is not an important element of fraud? A. Confidence B. Deception C. Trickery D. Intelligence

Fraud is considered to be: A. A serious problem that continues to grow. B. A problem felt by a few individuals, but not by most people. C. A mild problem that most businesses need not worry about. D. A problem under control.

People who commit fraud are usually: A. New employees B. Not well groomed and have long hair and tattoos. C. People with strong personalities D. Trusted individuals

"The use of one's occupation for persona enrichment through the deliberate misuse or misapplication of the employing organization's resources or assets" is the definition of which of the following types of fraud? A. Employee embezzlement or occupational fraud B. Investment scams C. Management fraud D. Vendor fraud

Corporate employee fraud fighters: A. Work as postal inspectors and law enforcement officials. B. Prevent, detect, and investigate fraud within a company. C. Are lawyers the defend and/or prosecute fraud cases. D. None of the above.

Investment scams most often include: A. An action by top management against employees. B. Worthless investments or assets sold to unsuspecting investors. C. An overcharge for purchased goods. D. Nonpayment of invoices for goods purchased by customers.

Which of the following is not true of civil fraud? A. It usually begins when one party files a complaint. B. The purpose is to compensate for harm done to another C. It must be heard by 12 jurors D. Only "the preponderance of the evidence" is needed for the plaintiff to be successful.

Future careers in fraud will most likely be: A. In low demand B. In about the same demand as now C. Low paying D. In higher demand and financially rewarding

Studying fraud will help you to: A. Learn evidence-gathering skills B. Avoid high-risk and fraudulent activities C. Learn valuable interviewing skills D. All of the above

Which of the following is not a reliable resource for fraud statistics? A. FBI agencies B. Health agencies C. Insurance organizations D. Fraud perpetrators

Which of the following statements is true? A. Bank robberies are more costly than frauds B. Fraud is often labeled the fastest growing crime C. FBI agencies are currently spending approximately 35% of their time on fraudulent activities

Which of the following is not an element of fraud? A. False representation B. Accidental behavior C. Damage to a victim D. Intentional or reckless behavior

What is the best way to minimize fraud within an organization? A. Detection of fraud B. Investigation of fraudulent behavior C. Prevention activities D. Research company activities

What is the most important element in successful fraud schemes? A. Promised benefits B. Confidence in the perpetrator C. Profitable activities D. Complexity

Which of the following characters is least likely to be involved in a fraud? A. Middle-aged person who has a middle management position B. A long-haired teenager wearing leather pants C. Recent college graduate D. Senior executives who have obtained stock options

Which of the following is not a fraud type? A. Direct employee embezzlement B. Indirect employee embezzlement C. Supervisor fraud D. Investment scams

Which of the following is not a form of vendor fraud? A. Overcharge for purchased goods B. Shipment of inferior goods C. Nonshipment of goods even though payment is made D. Not paying for goods purchased

Civil law performs which of the following functions? A. Remedy for violation of private rights B. Remedy for violations against society as a whole C. Punishment for guilt "beyond reasonable doubt" D. Monetary reimbursement for federal charges

Fraud fighting includes what type of careers? A. Professors B. Lawyers C. CPA firs D. All of the above

Which of the following is not an example of employee embezzlement? A. Land conservation employees stealing chain saws B. Checkout cashiers stealing money from the cash register C. Angry employees vandalizing the building with spray paint D. Salespeople overcharging for products and pocketing the excess cash

Which of the following is not an example of vendor fraud? A. A vendor overcharges for a contracting job which it completed on time B. A vendor bills for services not performed C. A vendor bills for goods not provided D. A vendor has much higher prices than its competitors

"Deceptive manipulation of financial statements" describes which kind of fraud? A. Management fraud B. Criminal fraud C. Stock market fraud D. Bookkeeping fraud