Term
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Definition
| In the case of Melissa Robinson, Executive Secretary of a charitable organization in Nashville, what type of fraud did she commit? |
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Term
1) She was one of two people in the organization that had the authority to sign checks
2) She was very trusted by everyone around her
3) There was no oversight of currency collections
4) Towards the end, she managed the finances from her own home |
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Definition
| How was money easily stolen from the charitable organization in the case of Melissa Robinson? |
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Term
| b) The internal auditor noticed a decline in collections from some activities the organization was involved in |
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Definition
In the case of Melissa Robinson, "A Wolf in Sheep's Clothing," fraud was discovered because:
a) Somebody mentioned that Melissa had been taking money from the organization
b) The internal auditor noticed a decline in collections from some activities the organization was involved in
c) there was a surprise audit
d) By mistake |
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Term
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Definition
In the case of Melissa Robinson, she was easily able to steal money because:
a) She was one of two people in the organization with the authority to sign checks
b) The currency collections were not monitored
c) No yearly audits were conducted during Robinson's tenure
d) She was one of the most dedicated employees and her co-workers trusted her
e) All of the above
f) Only A and D |
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Term
| a) She signed her own name and forged a second signature on checks; and stole from the organization's three bank accounts a little at a time |
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Definition
In the case of Melissa Robinson, how did she steal money from the company?
a) She signed her own name and forged a second signature on checks; and stole from the organization's three bank accounts a little at a time
b) She stole a lump sum of cash
c) She forged signatures and made sure to cover up her fraud by using a form of lapping
d) None of the above are correct |
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Term
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Definition
| _____ _____ occurs when an employee converts an organization's funds by either 1) fraudulently preparing a check drawn on the organization's account for his own benefit, or 2) intercepting a check drawn on the organization's account that is intended for a third party and converting that check to his own benefit. |
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Term
| Check tampering is classified as an Asset Misappropriation (Cash) - Fraudulent Disbursement |
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Definition
| According to the fraud tree, how is check tampering classified? |
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Term
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Definition
| T/F Check tampering is a form of fraudulent disbursement that applies only to check drawn on the victim organization's bank accounts |
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Term
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Definition
| T/F In relation to fraudulent disbursement schemes, check tampering is less common than billing and expense reimbursement schemes |
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Term
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Definition
What type of scheme is an altered payee scheme?
a) Check tampering
b) Billing scheme
c) Cash larceny
d) None of the above |
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Term
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Definition
Of the following employees, which is most likely to have access to the company's checks?
a) HR employee
b) Secretary
c) Office Managers
d) Custodian |
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Term
1) Keep the checks in a locked up location and limit access to those whose duties include check preparation
2) Promptly destroy voided checks
3) Print the checks on a special type of paper (example: watermark) |
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Definition
| What are some ways that a company could safeguard the organization's check stock? |
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Term
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Definition
| The signing of another person's name to a document (such as a check) with a fraudulent intent, or the fraudulent alteration of a genuine instrument |
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Term
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Definition
| A check tampering scheme in which an employee misappropriates a check and fraudulently affixes the signature of an authorized maker thereon |
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Term
| Forged endorsement scheme |
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Definition
| A check tampering scheme in which an employee intercepts a company check intended for a third party and converts the check by signing the third party's name on the endorsement line of the check |
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Term
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Definition
| A method of concealing a check tampering scheme by manipulating the bank reconciliation so that the bank balance and the book balance match |
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Term
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Definition
| A check tampering scheme in which an employee intercepts a company check intended for a third party and alters the payee designation so the check can be converted by the employee of an accomplice |
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Term
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Definition
| A check tampering scheme in which an employee prepares a fraudulent check and submits it, usually along with legitimate checks, to an authorized maker who signs it without a proper review |
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Term
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Definition
| A check tampering scheme in which an employee with signature authority on a company account writes fraudulent checks for his own benefit and signs his own name as the maker |
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Term
1) Separation of check preparation and check signing
2) Maintain a list of personnel that are authorized to sign checks |
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Definition
| What are some of the ways to prevent forged maker schemes? |
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Term
| In a forged maker scheme, the perpetrator is normally working with a blank check. In a forged endorsement scheme, the perpetrator is tampering with a check that has already been written. In these schemes, the fraudster obtains the check after they are signed but before they are properly delivered. |
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Definition
| What is the difference between a forged maker scheme and a forged endorsement scheme? |
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Term
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Definition
| T/F Stealing returned checks is not as common as other methods for intercepting checks. However, it is also very difficult to detect and can lead to large-scale fraud |
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Term
a) Preparing checks
b) Signing checks
c) Delivering checks |
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Definition
| In preventing the theft of outgoing company checks, what three duties must be separated? |
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Term
a) Immediately stamp paid vouchers with a "paid" stamp
b) Computer systems should flag duplicate invoice numbers |
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Definition
| What are some ways to prevent the theft of outgoing checks? |
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Term
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Definition
| In an altered payee scheme the fraudster inserts his own name, the name of a ____ ____, or some other name on the payee line of the check |
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Term
| When the name and/or amount on the fraudulent check does not match the entry in the books |
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Definition
| How can altered payee schemes usually be detected? |
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Term
| In a concealed check scheme the employee prepares a fraudulent check and gives it to an "authorized maker" that fails to carefully review the check before signing it |
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Definition
| How does a concealed check scheme differ from a forged maker scheme? |
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Term
| d) Concealed check scheme |
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Definition
Fred prepared a check payable to himself and gave it to his manager along with various other checks. His manager failed to check the names of the payees on the checks and therefore authorized his fraudulent check. What kind of check tampering scheme is this considered to be?
a) Altered payee scheme
b) Authorized maker scheme
c) Forged maker scheme
d) Concealed check scheme |
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Term
| b) Authorized maker scheme (p 139) because an employee with signature authority signs the check |
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Definition
Which check tampering scheme is the most difficult to prevent?
a) Concealed check scheme
b) Authorized maker scheme
c) Forged endorsement scheme
d) Altered payee scheme |
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Term
| a) Authorized maker scheme |
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Definition
Bob is a manager with the authority to sign checks. He wrote out checks to himself to pay for his personal expenses. For fear of losing their jobs, employees that were aware of the theft didn't report the fraud. What type of check tampering scheme is this?
a) Authorized maker scheme
b) Forged maker scheme
c) Concealed check scheme
d) Altered payee scheme |
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Term
| Because they involve the alteration of checks that were already prepared and coded by someone else (p 143) |
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Definition
| In concealing check tampering, why are forged endorsement schemes and altered payee schemes different from forgery and authorized maker schemes? |
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Term
| The operations manager discovered a company check on Ernie's desk written out in his name with Sell's signature being forged |
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Definition
| In the case titled "What are friends for", what caused James Sell to believe that Ernie Phillips was stealing from the company? |
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Term
| Ernie signed Sell's name in his own hand writing on some checks and marked other checks with a signature stamp that was supposed to be locked up. |
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Definition
| In the case study, "What Are Friends For", how did Ernie Phillips authorize the fraudulent checks? |
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Term
| He took checks out of sequence so they would shop up at the end of the bank statement; then intercepted the statement and altered the report at the end, returning a copy of the statement to the clerk for filing |
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Definition
| How did Ernie Phillips attempt to conceal his check tampering scheme? |
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Term
| c) Ernie didn't try to conceal his fraudulent acts because he knew no one would question his authority as controller |
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Definition
Which of the following statements is not correct in relation to the case study "What are friends for" (Ernie Phillips)?
a) Ernie used a forged maker scheme to steal money from the company
b) Ernie forged Sell's signature by using his own hand-writing, a signature stamp, and by placing fraudulent checks (made to himself) in a pile of checks for the operations manager to sign
c) Ernie didn't try to conceal his fraudulent acts because he knew no one would question his authority as controller
d) Ernie used the stolen money to live beyond his means
e) The CPA board revoked his license, he was required to repay the full amount of money he stole |
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