Economic Crime Investigation
Final Exam Questions
Course Introduction
Economic Crime Investigation explores the various methods and techniques used to detect, investigate, and prevent financial crimes such as fraud, money laundering, embezzlement, bribery, and corruption. The course examines the legislative frameworks, investigative procedures, ethical considerations, and the use of technology in unraveling complex financial schemes. Students will analyze real-world case studies, learn best practices in evidence collection and forensic accounting, and gain insights into the roles of regulatory agencies and law enforcement in combating economic crimes, preparing them for careers in law, accounting, compliance, and criminal justice.
Recommended Textbook Fraud Examination 5th Edition by W. Steve Albrecht
Available Study Resources on Quizplus
18 Chapters
886 Verified Questions
886 Flashcards
Source URL: https://quizplus.com/study-set/1315 Page 2
Chapter 1: The Nature of Fraud
Available Study Resources on Quizplus for this Chatper
50 Verified Questions
50 Flashcards
Source URL: https://quizplus.com/quiz/26176
Sample Questions
Q1) Which of the following is NOT a characteristic of management fraud?
A)Top management deception.
B)Manipulation of financial statements.
C)Kickbacks or bribes.
D)Pressure to earn year-end bonuses.
Answer: C
Q2) 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?
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. Answer: C
To view all questions and flashcards with answers, click on the resource link above.
3
Chapter 2: Who Commits Fraud and Why
Available Study Resources on Quizplus for this Chatper
57 Verified Questions
57 Flashcards
Source URL: https://quizplus.com/quiz/26177
Sample Questions
Q1) Which of the following is an example of an authorization control procedure?
A)Password protection
B)Periodic job rotation
C)Cash checks
D)Supervisor review
Answer: A
Q2) Generally,internal controls are implemented in a corporation to help prevent which element of the fraud triangle?
A)Perceived opportunity
B)Perceived pressure
C)Rationalization
D)Authorization
Answer: A
Q3) Greed,living beyond one's means and high bills all describe what type of fraud-related pressure?
A)Financial
B)Peer
C)Environmental
D)Work-Related
Answer: A
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: Fighting Fraud: an Overview
Available Study Resources on Quizplus for this Chatper
56 Verified Questions
56 Flashcards
Source URL: https://quizplus.com/quiz/26178
Sample Questions
Q1) A person may have very strong ethics in the way he or she treats family and friends,but not understand how failure to submit tax withholdings to the government affects peoples' lives or constitutes unethical or fraudulent behavior.This is an ethical issue encountered in which level of the ethical maturity model?
A)Personal ethical understanding
B)Ethical courage
C)Ethical leadership
D)Application of ethics to business situations
Answer: D
Q2) Although there are multiple approaches to fraud investigation,most investigators tend to rely heavily on ______.
A)invigilation
B)surveillance
C)interviews
D)confrontation
Answer: C
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Preventing Fraud
Available Study Resources on Quizplus for this Chatper
50 Verified Questions
50 Flashcards
Source URL: https://quizplus.com/quiz/26179
Sample Questions
Q1) What are the key attributes for a low-fraud environment?
A)Rules, control, and consequences.
B)Recognition, prosecution, and restitution.
C)Honesty, openness, and assistance.
D)Rules, consequences, and rewards.
Q2) Which of the following is false regarding a comprehensive approach to fighting fraud?
A)detecting fraud is the responsibility of the independent auditors
B)evaluating controls is the function of the internal auditor
C)corporate security officers see their role as investigative
D)employees are in the best position to prevent and spot fraud
Q3) A good internal control system includes:
A)open work environments.
B)rigid rules.
C)segregation of duties.
D)following strict hiring procedures.
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Recognizing the Symptoms of Fraud
Available Study Resources on Quizplus for this Chatper
45 Verified Questions
45 Flashcards
Source URL: https://quizplus.com/quiz/26180
Sample Questions
Q1) Who in an organization is NOT in a good position to recognize fraud during the theft act?
A)Other employees
B)Managers
C)Auditors
D)Coworkers
Q2) Which of the following usually motivates embezzlers to indulge in a fraudulent activity?
A)Pursuit of immediate gratification.
B)Safeguard their future.
C)Cover expenses required to live.
D)Protection against uncertainties.
Q3) Which of the following is a true statement?
A)Lifestyle changes are often the easiest fraud symptoms to detect.
B)Lifestyle changes are helpful in detecting fraud on behalf of a corporation.
C)Fraud is indicated when an employee sells a large number of shares of stock he/she owns.
D)Evidence of an employee paying off large debt can be verified, but it is costly to do so.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 6: Data-Driven Fraud Detection
Available Study Resources on Quizplus for this Chatper
50 Verified Questions
50 Flashcards
Source URL: https://quizplus.com/quiz/26181
Sample Questions
Q1) Which of the following records data for each case in a graph and analyzes the slope?
A)summarization analysis
B)time-trend analysis
C)fuzzy-matching method
D)cross tables method
Q2) Which of the following statements is NOT true?
A)In recent years there have been many cases of financial statement fraud.
B)Proactive fraud detection methods are in their infancy.
C)Accounting anomalies indicate fraud has or is occurring.
D)Fraud investigation involves determining who committed the fraud, the schemes used and how much money or assets were taken.
Q3) According to Benford's law,the first digit of random data sets will most often begin with which number?
To view all questions and flashcards with answers, click on the resource link above.
8
Chapter 7: Investigating Theft Acts
Available Study Resources on Quizplus for this Chatper
44 Verified Questions
44 Flashcards
Source URL: https://quizplus.com/quiz/26182
Sample Questions
Q1) Identify the best pattern/order to go about a theft investigation.
A)Search public records, check personal records, interview suspect, interview former employers, and interview other buyers.
B)Check personnel records, interview former employers, search public records, ,interview other buyers, and interview suspect.
C)Interview suspect, interview former employers, search public records, check personal records, and interview other buyers.
D)Interview other buyers, check personal records, interview former employers, interview suspect, and search public records.
Q2) Experts recommend that invigilation must continue:
A)for at least 7 days.
B)for at least 14 days.
C)for at least 21 days.
D)for an indefinite period determined by the individual investigator.
To view all questions and flashcards with answers, click on the resource link above.
9
Chapter 8: Investigating Concealment
Available Study Resources on Quizplus for this Chatper
42 Verified Questions
42 Flashcards
Source URL: https://quizplus.com/quiz/26183
Sample Questions
Q1) Which of the following is NOT an action by the fraud perpetrators to hide/conceal their illegal act(s)?
A)manipulating documentary evidence
B)modifying records in computer databases
C)photocopying fraud-related documents
D)deleting records in computer databases
Q2) Which of the following statements is true?
A)Concealment investigation includes document investigation, physical asset counts, and computer searches.
B)Most concealment investigation techniques focus on obtaining eyewitness accounts as evidence.
C)Honesty testing is considered as a concealment investigation technique.
D)Concealment investigation is dependent on employee cooperation to gather evidence
Q3) Orders issued by a court or a grand jury to produce documents are called:
A)writs of certiorari.
B)search warrants.
C)voluntary consent.
D)subpoenas.
To view all questions and flashcards with answers, click on the resource link above.
Page 10
Chapter 9: Conversion Investigation Methods
Available Study Resources on Quizplus for this Chatper
42 Verified Questions
42 Flashcards
Source URL: https://quizplus.com/quiz/26184
Sample Questions
Q1) Net Worth Increase + Living Expenses =
A)Income
B)Funds from known sources
C)Liabilities
D)Assets
Q2) Mandy calls a local newspaper and pretends to be a neighbor who is away for the winter.She obtains account history and orders the newspaper for six months.Has Mandy committed a fraud? If yes,under which act?
A)No, the newspaper has not yet been delivered or paid.
B)Yes, she is in violation of the Gramm-Leach Bliley Act of 1999.
C)No, as the neighbor has not served any written notice to keep the information private.
D)Yes, she is in violation of Fair and Accurate Credit Transactions Act of 2003.
Q3) Name the major database maintained by the FBI.
A)CIA
B)UCC filings
C)DEA
D)NCIC
To view all questions and flashcards with answers, click on the resource link above.
11
Chapter 10: Inquiry Methods and Fraud Reports
Available Study Resources on Quizplus for this Chatper
60 Verified Questions
60 Flashcards
Source URL: https://quizplus.com/quiz/26185
Sample Questions
Q1) Guilty people almost never confess when it is conveyed that they are what type of person?
A)Bad
B)Simply careless
C)Intelligent
D)Obviously guilty
Q2) Which of the following is an element of a leading question?
A)It is not easily understood.
B)It contains the answer in it.
C)It should not confirm known facts.
D)It is confusing and suggests an answer opposite to the correct one.
Q3) Which of the following involves the use of volume,pitch,and voice quality to convey meaning?
A)Chronemic communication
B)Paralinguistic communication
C)Kinetic communication
D)Proxemic communication
To view all questions and flashcards with answers, click on the resource link above.
12
Chapter 11: Financial Statement Fraud
Available Study Resources on Quizplus for this Chatper
47 Verified Questions
47 Flashcards
Source URL: https://quizplus.com/quiz/26186
Sample Questions
Q1) Which of the following statements is true?
A)Most financial statement frauds occur in large historically profitable companies.
B)Most people who commit management fraud are first-time offenders.
C)An active board of directors or audit committee does little to deter fraud.
D)Perpetrating fraud is much easier in an organization with democratic leadership, where the decision making is spread among several individuals.
Q2) Which of the following is NOT one of the components of the fraud exposure rectangle?
A)Accounting system controls
B)Management and directors
C)Financial results and operating characteristics
D)Organization and its industry
Q3) Which of the following is depicted when the auditor simply considers his or her own incentives,such as audit fees,sampling costs,and penalties?
A)Higher-order reasoning
B)Zero-order reasoning
C)First-order reasoning
D)Deductive reasoning
To view all questions and flashcards with answers, click on the resource link above.
13
Chapter 12: Revenue- and Inventory-Related Financial Statement
Frauds
Available Study Resources on Quizplus for this Chatper
49 Verified Questions
49 Flashcards
Source URL: https://quizplus.com/quiz/26187
Sample Questions
Q1) Overstating of sales in the income statement leads to:
A)decrease in inventory turnover ratio.
B)decrease in EPS.
C)increase in gross profit ratio.
D)decrease in accounts receivable ratio.
Q2) According to the text,why is the accounts receivable turnover ratio widely used in analyzing revenue-related fraud?
A)Significant amounts of fictitious revenues and receivables will almost always affect this ratio except in rare cases.
B)Adding fictitious receivables will generally decrease the number of days it takes to collect receivables.
C)If the ratio generally exceeds 1, recording fictitious sales will significantly increase the ratio, making it easy to spot fraud.
D)Since the ratio should ideally equal to 1, any deviation from this number is easy to detect.
To view all questions and flashcards with answers, click on the resource link above.
14
Chapter 13: Liability, asset, and Inadequate Disclosure
Frauds
Available Study Resources on Quizplus for this Chatper
47 Verified Questions
47 Flashcards
Source URL: https://quizplus.com/quiz/26188
Sample Questions
Q1) Which of the following applies to a "cookie jar?"
A)Understated accounts payable
B)Overstated current assets
C)Overstated reserves
D)Recording fictitious revenues
Q2) In liability fraud,liabilities are most often:
A)understated.
B)overstated.
C)recorded as assets.
D)recorded as expenses.
Q3) What is the easiest way to identify understatement of liability fraud exposures?
A)Analyze the trend of accounts payable for the company.
B)By using the formula, assets = capital + liabilities.
C)Investigate the various transactions that involve liabilities and can be understated.
D)Compare the company's liabilities with those of other players in the industry.
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: Fraud Against Organizations
Available Study Resources on Quizplus for this Chatper
50 Verified Questions
50 Flashcards
Source URL: https://quizplus.com/quiz/26189
Sample Questions
Q1) Which of the following statements with reference to extortion is true?
A)It is a crime even if the extortion message is only sent but not received.
B)The words "pay up or else" are insufficient to constitute extortion.
C)It is a crime even if the extortion message is sent either unwillingly or without the knowledge of the sender.
D)An extortionate threat made to another in jest is not extortion.
Q2) Which of the following is NOT one of the most common types of billing schemes?
A)Setting up dummy companies (shell companies) to submit invoices to the victim organization.
B)Altering or double-paying a nonaccomplice vendor's statements
C)Overbilling the company for travel and other related business expenses, such as business lunches, hotel bills, and air travel.
D)Making personal purchases with company funds.
Q3) Which of the following is the best example of theft of cash through skimming?
A)Preparing fraudulent checks.
B)Understating sales by recording larger-than reality sales discounts.
C)Setting up dummy companies.
D)Stealing cash after it has already been recorded.
To view all questions and flashcards with answers, click on the resource link above.
Page 16
Chapter 15: Consumer Fraud
Available Study Resources on Quizplus for this Chatper
45 Verified Questions
45 Flashcards
Source URL: https://quizplus.com/quiz/26190
Sample Questions
Q1) What is the most important way to fight identity theft?
A)By shredding mail that contains detailed information.
B)By taking extra care of the personal valuable information.
C)By using strong passwords and changing them often.
D)By preventing it from happening in the first place.
Q2) Which of the following is false regarding a Nigerian money offer scam?
A)States the need for urgent assistance.
B)Makes the victim feel like he or she is the only recipient of the special opportunity.
C)Involves someone trying to sell a piece of prime African real estate.
D)The e-mail is the promise of money and asks for help.
Q3) Which federal statute protects the privacy and confidentiality of patient information?
A)Family Educational Rights and Privacy Act
B)Identity Theft and Assumption Deterrence Act
C)Gramm-Leach-Bliley Act
D)Health Information Portability and Accountability Act
To view all questions and flashcards with answers, click on the resource link above.
Chapter 16: Bankruptcy, divorce, and Tax Fraud
Available Study Resources on Quizplus for this Chatper
66 Verified Questions
66 Flashcards
Source URL: https://quizplus.com/quiz/26191
Sample Questions
Q1) Which of the following is one of the Court-Appointed or Panel Trustee's duties or characteristics?
A)Investigate the acts, conduct, liabilities, assets, and financial condition of the debtor, the operation of the debtor's business and the desirability of the continuance of that business.
B)Approve reorganization plans
C)Administering bankruptcy cases and reviewing employees and fee applications.
D)Holds a valid claim against a debtor.
Q2) Which of the following statements is true concerning divorce cases?
A)Bankruptcy laws and statutes are much simpler than divorce laws and statutes
B)Divorce fraud never involves hiding or transferring assets
C)Most divorce cases are civil cases, with no criminal charges filed
D)It is illegal for divorce attorneys to hire investigators to help them find hidden assets
Q3) Which of the following is not true regarding bankruptcy and divorce frauds?
A)Bankruptcy or divorce is used to justify the fraud.
B)Bankruptcy or divorce is used to perpetuate the fraud.
C)Bankruptcy or divorce is used to conceal fraud.
D)Bankruptcy or divorce is used to cash out of the fraud.
To view all questions and flashcards with answers, click on the resource link above.
18
Chapter 17: E-Commerce Fraud
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/26192
Sample Questions
Q1) Generally,the best way to prevent fraud in e-business settings is to focus on:
A)reducing pressures.
B)buying and implementing anti-virus software.
C)reducing fraud opportunities.
D)hiring security experts.
Q2) Which of the following examples illustrates sniffing?
A)A fraudster impersonating a customer and buying equipment on the customer's account.
B)A fraudster viewing design data of a special project that is being transferred over a network.
C)A fraudster using another employee's passwords to access sensitive information.
D)An Internet site mimicking another site by using .org instead of .com.
Q3) Which of the following e-commerce threats spreads via direct transfer or email?
A)internet worms
B)a Trojan horse
C)wartrapping
D)phishing
To view all questions and flashcards with answers, click on the resource link above. Page 19
Chapter 18: Legal Follow-Up
Available Study Resources on Quizplus for this Chatper
46 Verified Questions
46 Flashcards
Source URL: https://quizplus.com/quiz/26193
Sample Questions
Q1) Which of the following describes an insurance contract that guarantees payment to an employer looking for protection in the event of unforeseen financial loss through the dishonest actions of an employee?
A)Business insurance
B)Workmen's compensation
C)Group insurance
D)Fidelity bonding
Q2) Which of the following observations is true concerning discovery?
A)It is the last stage of the civil litigation process.
B)It is one of the stages in a civil litigation but not in a criminal litigation.
C)It is often the most challenging part of civil litigation because discovery can be?time-consuming and expensive.
D)It is a series of written questions that specifically identify information needed from the?opposing party.
To view all questions and flashcards with answers, click on the resource link above. Page 20