Question 1

The following are all elements of Title 26, U.S. Code Section 7201 EXCEPT:

Accepted Answer

A)  not reporting bribe income may be grounds for being charged with tax evasion. 
B)  filing income tax that excludes income from fraud may be considered an improper tax filing. 
C)  bribes paid may be deducted as business expenses. 
D)  failure to report income from fraud may be grounds for being charged with tax evasion. 
A)  not reporting bribe income may be grounds for being charged with tax evasion. 
B)  filing income tax that excludes income from fraud may be considered an improper tax filing. 
C)  bribes paid may be deducted as business expenses. 
D)  failure to report income from fraud may be grounds for being charged with tax evasion.

Question 2

Which of the following is NOT a characteristic of management fraud?

Accepted Answer

A)  Top management deception 
B)  Manipulation of financial statements 
C)  Kickbacks or bribes 
D)  Pressure to earn year-end bonuses 
A)  Top management deception 
B)  Manipulation of financial statements 
C)  Kickbacks or bribes 
D)  Pressure to earn year-end bonuses

Question 3

The study conducted by the Association of Certified Fraud Examiners in 2016 estimated that organizations lose percent of their annual revenues to fraud.

Accepted Answer

A)  8 
B)  5 
C)  23 
D)  17 
A)  8 
B)  5 
C)  23 
D)  17

Question 4

Employee embezzlement can be direct or indirect. Indirect fraud occurs when:

Accepted Answer

A)  an employee uses company assets to run his/her private business. 
B)  employees establish dummy companies and have their employers pay for goods that are not actually delivered. 
C)  an employee receives a kickback from a vendor. 
D)  an employee steals company cash, inventory, tools, or other assets. 
A)  an employee uses company assets to run his/her private business. 
B)  employees establish dummy companies and have their employers pay for goods that are not actually delivered. 
C)  an employee receives a kickback from a vendor. 
D)  an employee steals company cash, inventory, tools, or other assets.

Question 5

Which of the following observations concerning occupational fraud is NOT true?

Accepted Answer

A)  It is clandestine. 
B)  It is committed for the purpose of direct or indirect financial benefit to the employee. 
C)  It usually involves two or more employees. 
D)  It costs the employing organization assets, revenues, or reserves. 
A)  It is clandestine. 
B)  It is committed for the purpose of direct or indirect financial benefit to the employee. 
C)  It usually involves two or more employees. 
D)  It costs the employing organization assets, revenues, or reserves.

Question 6

Which of the following is NOT an example of a fraud-fighting career?

Accepted Answer

A)  Working for the criminal investigation division of the IRS 
B)  Serving as an expert witness 
C)  Maintaining the security of public records 
D)  Defending an organization being sued in a civil case 
A)  Working for the criminal investigation division of the IRS 
B)  Serving as an expert witness 
C)  Maintaining the security of public records 
D)  Defending an organization being sued in a civil case

Question 7

Which individual listed is most likely to commit financial statement fraud in order to benefit an organization?

Accepted Answer

A)  An executive 
B)  An internal auditor 
C)  A floor manager (line supervisor) 
D)  The company treasurer 
A)  An executive 
B)  An internal auditor 
C)  A floor manager (line supervisor) 
D)  The company treasurer

Question 8

What is the most cost-effective way to minimize the cost of fraud?

Accepted Answer

A)  Prevention 
B)  Detection 
C)  Investigation 
D)  Prosecution 
A)  Prevention 
B)  Detection 
C)  Investigation 
D)  Prosecution

Question 9

Which of the following is NOT an element of a Ponzi scheme?

Accepted Answer

A)  Gaining other's confidence. 
B)  Promising abnormally high returns. 
C)  Collected money is invested. 
D)  Investment principle is partially used to make payments to previous investors. 
A)  Gaining other's confidence. 
B)  Promising abnormally high returns. 
C)  Collected money is invested. 
D)  Investment principle is partially used to make payments to previous investors.

Question 10

Fraud statistics come from all of the following sources EXCEPT:

Accepted Answer

A)  government agencies. 
B)  insurance companies. 
C)  victims. 
D)  fraud perpetrators. 
A)  government agencies. 
B)  insurance companies. 
C)  victims. 
D)  fraud perpetrators.

Question 11

Which of the following is NOT one of the major types of fraud classification schemes?

Accepted Answer

A)  Employee embezzlement 
B)  Government fraud 
C)  Investment scams 
D)  Customer fraud 
A)  Employee embezzlement 
B)  Government fraud 
C)  Investment scams 
D)  Customer fraud

Question 12

Which of the following is the most common type of occupational fraud?

Accepted Answer

A)  Management fraud 
B)  Mail fraud 
C)  Investment fraud 
D)  Employee embezzlement 
A)  Management fraud 
B)  Mail fraud 
C)  Investment fraud 
D)  Employee embezzlement

Question 13

Civil claims begin when one party files a complaint against another, usually for the purpose of:

Accepted Answer

A)  having a penalty imposed. 
B)  sending the perpetrator to prison. 
C)  proving the perpetrator guilty. 
D)  being awarded financial restitution. 
A)  having a penalty imposed. 
B)  sending the perpetrator to prison. 
C)  proving the perpetrator guilty. 
D)  being awarded financial restitution.

Question 14

How is the confidence element established in a Ponzi scheme?

Accepted Answer

A)  By investing in prime bonds. 
B)  By issuing notarized certificates. 
C)  By paying returns to investors initially. 
D)  By returning money to all investors. 
A)  By investing in prime bonds. 
B)  By issuing notarized certificates. 
C)  By paying returns to investors initially. 
D)  By returning money to all investors.

Question 15

Management fraud is often referred to as:

Accepted Answer

A)  stockholder fraud. 
B)  financial statement fraud. 
C)  employee fraud. 
D)  investment fraud. 
A)  stockholder fraud. 
B)  financial statement fraud. 
C)  employee fraud. 
D)  investment fraud.

Question 16

To be successful, plaintiffs in civil cases must prove their case by which of the following?

Accepted Answer

A)  By the preponderance of the evidence 
B)  Beyond a reasonable doubt 
C)  To a degree of reasonable mitigation 
D)  To the standard of prima facie 
A)  By the preponderance of the evidence 
B)  Beyond a reasonable doubt 
C)  To a degree of reasonable mitigation 
D)  To the standard of prima facie

Question 17

Which of the following is a common example of vendor fraud?

Accepted Answer

A)  Fraud perpetrated through collusion between buyers and vendors. 
B)  Fraud perpetrated by upper management. 
C)  The perpetrator physically removes the inventory from the business premises. 
D)  A fraud perpetrated through financial statement manipulation. 
A)  Fraud perpetrated through collusion between buyers and vendors. 
B)  Fraud perpetrated by upper management. 
C)  The perpetrator physically removes the inventory from the business premises. 
D)  A fraud perpetrated through financial statement manipulation.

Question 18

Government agencies such as the FBI, FDIC, IRS, or various health agencies publish fraud statistics from time to time. Which of the following observations concerning such statistics is true?

Accepted Answer

A)  Generally, their statistics are complete. 
B)  Such information is rarely used. 
C)  They provide only those statistics related to their jurisdiction. 
D)  They usually provide a total picture in the areas for which they have responsibility. 
A)  Generally, their statistics are complete. 
B)  Such information is rarely used. 
C)  They provide only those statistics related to their jurisdiction. 
D)  They usually provide a total picture in the areas for which they have responsibility.

Question 19

Which legal code makes the bribing of public officials illegal?

Accepted Answer

A)  Title 18, U.S. Code Section 201 
B)  Title 41, U.S. Code Section 51 to 58 
C)  Title 18, U.S. Code Section 1341 
D)  Title 18, U.S. Code Section 1344 
A)  Title 18, U.S. Code Section 201 
B)  Title 41, U.S. Code Section 51 to 58 
C)  Title 18, U.S. Code Section 1341 
D)  Title 18, U.S. Code Section 1344

Question 20

A company was the victim of several frauds that totaled approximately $10 million in one year. With a profit margin of 10 percent, and assuming that the company's product sold for $1,000 per unit, how many additional units must the company sell to compensate for the fraud losses?

Accepted Answer

A)  1 million 
B)  100 million 
C)  100,000 
D)  10,000 
A)  1 million 
B)  100 million 
C)  100,000 
D)  10,000

The following are all elements of Title 26, U.S. Code Section 7201 EXCEPT:

Which of the following is NOT a characteristic of management fraud?

The study conducted by the Association of Certified Fraud Examiners in 2016 estimated that organizations lose percent of their annual revenues to fraud.

Employee embezzlement can be direct or indirect. Indirect fraud occurs when:

Which of the following observations concerning occupational fraud is NOT true?

Which of the following is NOT an example of a fraud-fighting career?

Which individual listed is most likely to commit financial statement fraud in order to benefit an organization?

What is the most cost-effective way to minimize the cost of fraud?

Which of the following is NOT an element of a Ponzi scheme?

Fraud statistics come from all of the following sources EXCEPT:

Which of the following is NOT one of the major types of fraud classification schemes?

Which of the following is the most common type of occupational fraud?

Civil claims begin when one party files a complaint against another, usually for the purpose of:

How is the confidence element established in a Ponzi scheme?

Management fraud is often referred to as:

To be successful, plaintiffs in civil cases must prove their case by which of the following?

Which of the following is a common example of vendor fraud?

Government agencies such as the FBI, FDIC, IRS, or various health agencies publish fraud statistics from time to time. Which of the following observations concerning such statistics is true?

Which legal code makes the bribing of public officials illegal?

A company was the victim of several frauds that totaled approximately $10 million in one year. With a profit margin of 10 percent, and assuming that the company's product sold for $1,000 per unit, how many additional units must the company sell to compensate for the fraud losses?

Who Commits Fraud and Why

Fighting Fraud: an Overview

Preventing Fraud

Recognizing the Symptoms of Fraud

Data-Driven Fraud Detection

Investigating Theft Acts

Investigating Concealment

Conversion Investigation Methods

Inquiry Methods and Fraud Reports

Financial Statement Fraud

Revenue- and Inventory-Related Financial Statement Frauds

Liability, Asset, and Inadequate Disclosure Frauds

Fraud Against Organizations

Consumer Fraud

Bankruptcy, Divorce, and Tax Fraud

E-Commerce Fraud

Legal Follow-Up

Filters

Exam 1: The Nature of Fraud

The following are all elements of Title 26, U.S. Code Section 7201 EXCEPT:

Which of the following is NOT a characteristic of management fraud?

The study conducted by the Association of Certified Fraud Examiners in 2016 estimated that organizations lose percent of their annual revenues to fraud.

Employee embezzlement can be direct or indirect. Indirect fraud occurs when:

Which of the following observations concerning occupational fraud is NOT true?

Which of the following is NOT an example of a fraud-fighting career?

Which individual listed is most likely to commit financial statement fraud in order to benefit an organization?

What is the most cost-effective way to minimize the cost of fraud?

Which of the following is NOT an element of a Ponzi scheme?

Fraud statistics come from all of the following sources EXCEPT:

Which of the following is NOT one of the major types of fraud classification schemes?

Which of the following is the most common type of occupational fraud?

Civil claims begin when one party files a complaint against another, usually for the purpose of:

How is the confidence element established in a Ponzi scheme?

Management fraud is often referred to as:

To be successful, plaintiffs in civil cases must prove their case by which of the following?

Which of the following is a common example of vendor fraud?

Government agencies such as the FBI, FDIC, IRS, or various health agencies publish fraud statistics from time to time. Which of the following observations concerning such statistics is true?

Which legal code makes the bribing of public officials illegal?

A company was the victim of several frauds that totaled approximately $10 million in one year. With a profit margin of 10 percent, and assuming that the company's product sold for $1,000 per unit, how many additional units must the company sell to compensate for the fraud losses?

Who Commits Fraud and Why

Fighting Fraud: an Overview

Preventing Fraud

Recognizing the Symptoms of Fraud

Data-Driven Fraud Detection

Investigating Theft Acts

Investigating Concealment

Conversion Investigation Methods

Inquiry Methods and Fraud Reports

Financial Statement Fraud

Revenue- and Inventory-Related Financial Statement Frauds

Liability, Asset, and Inadequate Disclosure Frauds

Fraud Against Organizations

Consumer Fraud

Bankruptcy, Divorce, and Tax Fraud

E-Commerce Fraud

Legal Follow-Up

Filters