Question 1

Bob Taylor, CFE, is writing a report on his findings from an investigation into an alleged inventory larceny scheme. During his investigation, he was unable to accurately quantify the amount of the loss to the victim company, but he assumes that the loss falls between $100,000 and $200,000. In the report, Bob should report the amount of the loss as $200,000 so that the company can recoup as much money as possible from the perpetrator.

Accepted Answer

Bob should not report an amount that he was unable to verify through his investigation. Reporting an incorrect amount could have legal and financial consequences for both the victim company and the perpetrator. Instead, Bob should report that he was unable to accurately quantify the amount of the loss and provide all of the evidence he gathered during his investigation.

Question 2

To obtain information about an auto loan, such as where and when the loan originated and the current address of the debtor, an investigator should search the Uniform Commercial Code documents filed with the Secretary of State.

Accepted Answer

The Uniform Commercial Code (UCC) documents, specifically the UCC-1 financing statements, are filed with the Secretary of State and contain information about secured transactions, including auto loans. Therefore, searching these documents can provide information about the loan, its origins, and the current address of the debtor.

Question 3

In which section of the standard fraud examination report should the investigator discuss the identity and background information obtained about the individuals implicated in the matter under investigation?

Accepted Answer

The body section is where the bulk of the investigation findings are presented, including the identity and background information of individuals implicated in the matter under investigation. The introduction and summary provide an overview of the investigation, while the results section focuses on the specific findings and conclusions related to the fraud allegation.

Question 4

In a written fraud examination report, the fraud examiner's conclusions about how the fraud occurred should be explicitly stated.

Accepted Answer

A fraud examination report should present the facts and findings objectively without drawing conclusions or opinions about how the fraud occurred.

Question 5

McCloud, an internal investigator for a private company, has reason to believe that LaRue, the company's controller, has been embezzling cash and living the high life on the company's dime. McCloud has just discovered that LaRue bought a mansion on the edge of town last year and McCloud wants to find out more about the purchase. Information about whether LaRue took out a mortgage on the property may be found by searching:

Accepted Answer

The answer of McCloud, an internal investigator for a private...

Question 6

Which of the following information is typically not included in a corporate registration?

Accepted Answer

Tax returns and quarterly reports are not typically included in a corporate registration, as these are separate filings with the relevant government agencies. The other information listed (location of principal office, names of directors and officers, date of incorporation) are all typically included in a corporate registration.

Question 7

A well-written, accurate, and understandable investigation report will:

Accepted Answer

A well-written, accurate, and understandable investigation report should convey all pertinent evidence, add credibility to the investigation, and accomplish the objectives of the case. Therefore, all of the above options are correct.

Question 8

Fraud examinations conclude with:

Accepted Answer

Fraud examinations conclude with a report of the investigation findings, which often include recommendations for further action, such as prosecution or civil litigation. While a conviction, confession, or opinion on guilt or innocence may be the ultimate goal, it is the responsibility of law enforcement or the legal system to make that determination. The fraud examiner's role is to gather and analyze evidence and present their findings objectively.

Question 9

To find the names of the parties who have an interest in the estate of a deceased individual, an investigator should search the records of which court?

Accepted Answer

The probate court deals with matters related to wills and estates, including determining the rightful heirs and beneficiaries. Therefore, searching the records of the probate court is the best option for identifying parties with an interest in the estate of a deceased individual. The county civil court and U.S. District court generally do not handle probate matters.

Question 10

When preparing an investigative report, the fraud examiner should assume that it will be read by outside parties.

Accepted Answer

The fraud examiner should assume that the investigative report will be read by outside parties such as law enforcement, lawyers, judges, and regulatory agencies. Therefore, the report should be accurate, complete, and easy to understand.

Question 11

Information concerning a corporation's name, ownership, stock value, initial shareholders, directors, and officers is registered and maintained at which of the following levels?

Accepted Answer

Information concerning a corporation's name, ownership, stock value, initial shareholders, directors, and officers is registered and maintained at the state level, typically with the Secretary of State or similar agency. The federal, municipal, and county levels may have some authority over certain aspects of a corporation's operations, but do not maintain the primary information related to its formation and ownership.

Quiz 14: Conducting Investigations and Report Writing