CIG Fraud Detection & Prevention Flashcards

Which of the following best describes 'occupational fraud' as defined by the Association of Certified Fraud Examiners (ACFE)?

Answer: The use of one's occupation for personal enrichment through deliberate misuse of organizational resources

The ACFE defines occupational fraud as the use of one's occupation for personal enrichment through the deliberate misuse or misapplication of the employing organization's resources or assets.

The fraud triangle identifies three elements that contribute to fraudulent behavior. Which of the following is NOT one of those elements?

Answer: Retaliation

The fraud triangle consists of pressure, opportunity, and rationalization — retaliation is not a component of this model.

Which internal control technique is most effective at detecting duplicate payment fraud?

Answer: Duplicate payment detection software

Duplicate payment detection software specifically scans for identical invoice amounts, vendor names, and dates to flag payments that may have been processed more than once.

In government settings, 'ghost employees' are best detected by which of the following procedures?

Answer: Cross-referencing payroll records with HR active employee files

Matching payroll records against HR's list of active employees will reveal fictitious employees whose names appear on the payroll but do not actually work for the agency.

What does the term 'skimming' refer to in the context of fraud?

Answer: Stealing cash before it is recorded in the accounting system

Skimming is an off-book fraud scheme in which cash is stolen before it is ever entered into the organization's accounting records.

Which red flag is most commonly associated with a billing scheme involving a fictitious vendor?

Answer: Vendor address matches an employee's home address

A vendor address that matches an employee's personal address is a classic red flag indicating the employee may have created a fictitious vendor to route payments to themselves.