Question 1

Penalties for bank fraud include a maximum fine of $1 million and up to how much time in prison?

Accepted Answer

Bank fraud can result in up to 30 years in prison, reflecting the severity of the crime and its impact on financial institutions and individuals.

Question 2

One example of health care fraud involves billing for more expensive services or procedures than were actually provided or performed. This practice is termed ______ and requires "inflation" of the patient's diagnosis code to a more serious condition consistent with the false procedure code.

Accepted Answer

Upcoding is the practice of billing for more expensive services or procedures than were actually provided, often involving the inflation of a patient's diagnosis code to reflect a more serious condition that justifies the higher billing.

Question 3

What white-collar crime involves a contract or conspiracy designed to stifle competition, create a monopoly, artificially maintain prices, or otherwise interfere with free-market competition?

Accepted Answer

Restraint of trade is the correct term for activities that interfere with free-market competition, such as creating monopolies or fixing prices. These actions are considered white-collar crimes because they disrupt the natural competition in the market.

Question 4

If a store advertises sweaters at a bargain price but does not actually have any sweaters for sale for that price, they are guilty of which offense?

Accepted Answer

This scenario is an example of false advertising, where a store advertises a product at a specific price without the intention or ability to sell it at that price, misleading consumers.

Question 5

A white-collar crime in which a stockbroker makes repeated trades with a client's account in order to fraudulently increase his or her commissions is known as:

Accepted Answer

Churning refers to the practice of a broker conducting excessive trading in a client's account mainly to generate higher commissions. This activity is considered unethical and illegal as it prioritizes the broker's financial gain over the client's investment interests.

Question 6

Income-tax evasion is a type of client fraud. Not paying taxes is an example of:

Accepted Answer

The answer of Income-tax evasion is a type of client...

Question 7

Who is the victim in crimes of influence peddling?

Accepted Answer

Influence peddling typically harms the organization by compromising its decision-making processes, integrity, and potentially its financial standing, making the organization itself the victim.

Question 8

In 1977, Congress passed the Foreign Corrupt Practices Act, which made it illegal to:

Accepted Answer

The Foreign Corrupt Practices Act of 1977 specifically made it illegal to bribe foreign officials to assist in obtaining or retaining business.

Question 9

Which action would be considered health care fraud?

Accepted Answer

The answer of Which action would be considered health care...

Question 10

When firms divide a region into territories, and each firm agrees not to compete in the territories of others, it is illegal and is called:

Accepted Answer

This practice is known as a division of markets, where firms agree not to compete in specific territories, effectively dividing the market among themselves. This is illegal under antitrust laws because it restricts competition.

Question 11

A corporation that requires its customers to use one of its other services is practicing a:

Accepted Answer

A tying arrangement is a practice in which a seller requires a buyer to purchase one product or service in order to obtain another product or service. This is often used to leverage the market power of one product to increase sales of another product.

Question 12

Which Act established health care fraud as an independent federal criminal offense that carries a penalty of up to 10 years in prison?

Accepted Answer

The Health Insurance Portability and Accountability Act (HIPAA) established health care fraud as an independent federal criminal offense, with penalties of up to 10 years in prison for those convicted.

Question 13

What is the minimum dollar amount that must be involved for the government to prove tax fraud?

Accepted Answer

The government does not require a minimum dollar amount to prove tax fraud. Any amount of money involved in fraudulent activities can lead to charges, as the act of fraud itself, rather than the amount, is the focus of legal scrutiny.

Question 14

Churning, front running, and bucketing are types of:

Accepted Answer

Churning, front running, and bucketing are all unethical and illegal practices in the securities industry, thus they are types of securities fraud. Churning refers to excessive trading by a broker in a client's account to generate commissions. Front running is the practice of a broker executing orders on a security for its own account while taking advantage of advance knowledge of pending orders from its customers. Bucketing is the illegal practice of a broker confirming an order to buy or sell a security without actually executing the order, often to take advantage of a more favorable price movement for the broker's benefit.

Question 15

Tom DeLay was forced out of politics because of his involvement in a bribery scandal involving Washington, D.C., lobbyist Jack Abramoff. Representative Randy "Duke" Cunningham resigned from Congress after confessing to accepting $2.4 million in bribes. Former Illinois Governor George Ryan was convicted of steering government contracts to people willing to give him kickbacks and bribes. These three men committed the white-collar crime of:

Accepted Answer

These cases involve influence peddling, where individuals use their position or influence inappropriately for personal gain, such as accepting bribes or kickbacks in exchange for political favors or contract awards.

Question 16

When powerful institutions willfully violate the laws that restrain them from doing social harm, or that require them to do social good, it is called corporate crime or:

Accepted Answer

Organizational crime refers to illegal activities committed by individuals within their legitimate occupations or financial activities, often for the benefit of their employing organization. This term is used to describe crimes committed by businesses and government professionals.

Question 17

The factor that distinguishes corporate crime from individual-level white-collar crime is that with corporate crime, the perpetrator is a(n) _______ and not a(n) _________.

Accepted Answer

Corporate crime is committed by companies or businesses as entities (legal fictions), rather than by individuals acting on their own behalf.

Question 18

Systematic theft of company property by employees is common and is called:

Accepted Answer

Pilferage refers to the systematic theft of company property or merchandise by employees or individuals within an organization. It typically involves the theft of small, easily concealable items over a period of time.

Question 19

A white-collar ______ involves the criminal activity of people who use a business proposition to trick others out of their money.

Accepted Answer

A swindle involves tricking someone out of their money, fitting the description of a white-collar crime involving a business proposition.

Question 20

In the 1930s, Sutherland first used the phrase "white-collar crime" to describe the criminal activities of:

Accepted Answer

Sutherland used the term "white-collar crime" to highlight crimes committed by individuals in higher social classes, particularly those who are rich and powerful, often in business or professional settings.

Quiz 13: Enterprise Crime: White-Collar, Green-Collar, and Transnational Organized Crime