Criminology Questions

Sec.
1 Criminology
Pages # Quest.
I. Understanding Human Behavior . 2
II. !heories o" Crime Causation... .... # 1$
III. %hite collar Crime ..... ... 1$
I&. 'rgani(ational Crime ...... 1# 2#
&. 'ccu)ational Crime ............ .21 2*
&I. +es)onsi,ility "or -raud Prevention....... 2.
&II. Cor)orate Sentencing /uidelines ........... 0* 2*
&III. -raud Prevention Policy .. ...... .01 12
I3. Punishment ...........#* 10
3. Criminal 4ustice System ...........## 22
3I. 5thics "or -raud 56aminers ............11 2
3II. 7C-5 Code o" 5thics .......1 2.
______________________________________________________________________________
Sec. 1 - Criminology 0 / 66
I. Understanding Human Behavior8888888888888888888888888888888888888
1. Incentives programs and task-related bonuses are reinforcement strategies tat can be successfully utili!ed in te
"orkplace.
7. !rue
#. $alse
%en managers are faced "it disgruntled employees& tey can modify tese emotional circumstances& not 'ust "it
(image( "ork& but "it ade)uate compensation and by recogni!ing "orkers* accomplisments. Incentives programs
and task-related bonuses follo" tis principle& assuming tat employees "o feel callenged and re"arded by teir
'obs "ill produce more "ork at a iger )uality& and are less likely to violate te la".
+. Criminological researc as generally concluded tat punising a person for a crime elps deter tat person from
committing oter crimes in te future.
,. -rue
B. -alse
#eavioral studies& suc as tose conducted by Skinner& so" tat punisment is te least effective metod of
canging beavior. .unising brings (a temporary suppression of te beavior&( but only "it constant supervision
and application. In repeated e/periments& Skinner found tat punisment-eiter applying a negative stimulus& or
taking a"ay a positive one-effectively e/tinguised a sub'ect*s beavior& but tat te beavior returned ("en te
punisment "as discontinued and eventually all responses came out( again.
0. ,ccording to tis teory& people obey te la" because tey fear punisment1
,. 2ormative .erspective
B. Instrumental Pers)ective
C. 3oluntary Compliance
4. 5egitimacy
,ccording to te teory of Instrumental .erspective& people obey te la" because tey fear punisment.
6. ,ccording to Skinner& te most effective "ay to modify a persons beavior is troug1
7. Positive rein"orcement
#. 2egative reinforcement
C. .unisment
4. 2one of te above
Skinner concludes tat beavior is most effectively modified by managing and modifying desires troug
reinforcement7 e "ants to replace destructive beaviors "it productive ones& instead of trying to punis an already
e/isting impulse.
8. %en a detective searces for a suspect*s motive& te detective is using beaviorist metods of analysis.
7. !rue
#. $alse
______________________________________________________________________________
%en a detective searces for a suspect*s motive& te detective is using beaviorist metods of analysis. -e suspect&
it is assumed& "as stimulated by some arrangement of factors. 9any courses in criminology are built around te
fundamental premise tat crimes are particular sorts of beavior and best understood as te product of operant
conditioning.
6. #eavioral studies so" tat punisment is te least effective metod of canging beavior.
7. !rue
#. $alse
:. .unisment is te most effective metod for canging criminal beavior.
,. -rue
B. -alse
and application. In repeated e/periments& Skinner found tat punisment--eiter applying a negative stimulus& or
taking a"ay a positive one--effectively e/tinguised a sub'ect*s beavior& but tat te beavior returned ("en te
;. #eavioral studies so" tat ___________ is te least effective metod of canging beavior.
7. Punishment
#. Conditioning
C. <e"ards
4. .ositive reinforcement
=. ,ltering citi!ens* beavior by manipulating access to valued resources or treatening to impose sanctions is
kno"n as social control.
7. !rue
#. $alse
,ltering citi!ens* beavior by manipulating access to valued resources or treatening to impose sanctions is kno"n
as social control. >nce again& te concept is tat re"ard and punisment are "at cause people to obey te la".
.eople ma/imi!e teir personal gain and comply based on deterrence.
______________________________________________________________________________
Sec. 1 - Criminology + / 66
II. !heories o" Crime Causation88888888888888888888888888888888888888888888888888
10. $reud defines biological urges and "ants as1
7. Id
#. ?go
C. Superego
4. 2one of te above
$reud identified a tree-part structure to uman personality1 te id @te drive for food& se/& and oter life-sustaining
tingsA& te superego @te conscience "ic develops "en learned values become incorporated into a person*s
beaviorA& and te ego @te (I( or te product of te interaction bet"een "at a person "ants and "at is
conscience "ill allo" im to do to acieve "at e "antsA.
11. In te Bnited States& te best-kno"n e/planation regarding crime causation is1
7. !he theory o" di""erential association
#. -e teory of operant-utilitarianism
C. -e teory of differential reinforcement
4. 2one of te above
-e teory of differential association is undoubtedly te best-kno"n among all e/planations offered in te Bnited
States to account for crime& toug it too as been "idely critici!ed on te grounds tat it is 'ust about impossible to
test. -e teory first appeared as a systematic formulation in 1=0= in te tird edition of ?d"in C. Suterland*s
.rinciples of Criminology. 5ater& Suterland "ould make is best-kno"n contribution to criminology by coining te
prase "ite-collar crime and "riting a monograp on te sub'ect.
1+. %ic early pioneer in criminology developed te teory of te (criminal man(D
,. 5ogoni
#. #eccaria
C. #entam
9. :om,roso
-e foundations of biological teory "ere laid by Cesare 5ombroso& an Italian doctor& "o insisted tat tere "ere
(born( criminals& people "o "ere atavistic& tat is tro"backs to more primitive uman types. 5ombroso spent is
career measuring te bodies of offenders and concluded tat tey "ere marked by a ig degree of asymmetry& "it
suc tings as sloping foreeads and oter (anomalies.( 5ater critics "ould point out tat 5ombroso used no control
group-tat is e did not measure people "o "ere not criminals& and if e ad done so e "ould ave found tat
tey sared e)ually in tose kinds of traits tat 5ombroso presumed "ere indicative of criminal propensities.
10. -e differential reinforcement teory is a combination of te "ork of sociologists ?d"in Suterland and #. $.
Skinner.
7. !rue
#. $alse
______________________________________________________________________________
4ifferential reinforcement teory is anoter attempt to e/plain crime as a type of learned beavior. It is a revision of
Suterland*s "ork tat incorporates elements of psycological learning teory populari!ed by #. $. Skinner and
social learning teory. -e teory "as summari!ed by <onald ,kers in is 1=:: "ork& 4eviant #eavior1 , Social
5earning ,pproac.
16. ,ccording to te social control teory& te more important tat social relationsips are to a person& te less likely
it is tat te person "ill commit crimes.
7. !rue
#. $alse
-e social control teory suggests tat persons confronted "it te possibility of beaving in a la"-violative manner
are likely to ask of temselves1 (%at "ill my "ife-or my moter and fater -tink if tey find outD( -o te e/tent
tat persons believe tat oter people "ose opinions are important to tem "ill be disappointed or asamed& and to
te e/tent tat tey care deeply tat tese persons "ill feel so& tey "ill be constrained from engaging in te
sanctioned beavior.
18. ,ccording to te social control teory& tere is an important relationsip bet"een an individual*s social class and
tat person*s proclivity to commit a crime.
,. -rue
B. -alse
Cirsci insists tat tere is no important relationsip bet"een social class and delin)uency and crime7 tus& a person
in any class-lo"er& middle& or upper-"o defaults on liaisons "it te important formative agencies in our society
"ill be more apt to find imself or erself on a pat tat ends in crime.
16. Social control teory asserts tat institutions of every social system press its individuals into social conformity.
7. !rue
#. $alse
?ssentially& control teory argues tat te institutions of te social system train and press tose "it "om tey are
in contact into patterns of conformity. Scools train for ad'ustment in society& peers press te etos of success and
conventional beavior& and parents strive to inculcate la"-abiding abits in teir youngsters even& Cirsci stresses&
parents "o temselves play fast and loose "it te rules. -e teory rests on te tesis tat to te e/tent a person
fails to become attaced to te variety of control agencies of te society& is or er cances of violating te la" are
increased.
1:. ,ccording to te differential reinforcement teory& beavior is reinforced "en positive re"ards are gained or
punisment is avoided.
7. !rue
#. $alse
,ccording to te differential reinforcement teory& people learn social beavior by operant conditioning& beavior
controlled by stimuli tat follo" te beavior. #eavior is reinforced "en positive re"ards are gained or
punisment is avoided @negative reinforcementA. It is "eakened by negative stimuli @punismentA and loss of re"ard
@negative punismentA. %eter deviant or criminal beavior is begun or persists depends on te degree to "ic it
as been re"arded or punised and te re"ards or punisments attaced to its alternatives. -is is te teory of
differential reinforcement.
1;. Social control teory asserts tat te farter an individual strays from te norms of a society& te more likely e
or se is to commit a crime.
______________________________________________________________________________
7. !rue
#. $alse
conventional beavior& and parents strive to inculcate la"-abiding abits in teir youngsters even& Cirsci stresses&
parents "o temselves play fast and loose "it te rules. -e teory rests on te tesis tat to te e/tent a person
fails to become attaced to te variety of control agencies of te society& is or er cances of violating te la" are
increased. -is doctrine edges very close to being self-evident in its insistence tat close affiliation "it la"-abiding
people& groups& and organi!ations is predictive of la"-abiding beavior& but it is notably ric "it subordinate
statements& some of tem far from obvious.
1=. -e teory of differential association is used fre)uently to e/plain "ite-collar criminality. %ic of te
follo"ing is 2>- one of te assertions or principles of differential associationD
,. Criminal beavior is learned
B. Criminal ,ehavior is learned ,y a )rocess o" a,sor)tion
C. 4ifferential association may vary in fre)uency
4. ,ll of te above are principles of differential association
-e teory of differential association "as developed by criminologist ?d"in Suterland. It states tat1 @1A criminal
beavior is learned7 @+A it is learned from oter people in a process of communication7 @0A criminal beavior is
ac)uired troug participation "it intimate personal groups7 @6A te learning process includes te saping of
motives& drives& rationali!ations and attitudes7 @8A motives are learned from definitions of legal codes as being
favorable or unfavorable7 @6A a person becomes criminal because of an e/cess of definitions favorable to violation of
te la" over definitions unfavorable to violation of te la"7 @:Adifferential association may vary in fre)uency&
duration& priority& and intensity7 @;A learning criminal beavior involves all te mecanisms of oter learning7 @=A
learning differs from pure imitation7 and @10A "ile criminal beavior is an e/pression of general needs and values&
it is not e/plained by tese needs and values.
+0. -e aspects of affiliation addressed by te social control teory include1
,. Involvement
#. ,ttacment
C. #elief
9. 7ll o" the a,ove
$our aspects of affiliation are addressed by te social control teory1
E ,ttacment
E Commitment
E Involvement
E #elief
+1. ________ teories old tat criminality is a function of individual sociali!ation and te social-psycological
interactions people ave "it te various organi!ations& institutions& and processes of society.
7. Social Process
#. <outine ,ctivities
______________________________________________________________________________
C. Social Structure
4. #iological
Social process teories old tat criminality is a function of individual sociali!ation and te social-psycological
interactions people ave "it te various organi!ations& institutions& and processes of society.
++. ?ssentially& control teory argues tat te institutions of te social system train and press tose "it "om tey
are in contact into patterns of __________.
,. Criminality
#. 9indlessness
C. Con"ormity
4. .sycopaty
conventional beavior& and parents strive to inculcate la"-abiding abits in teir youngsters. -e teory rests on te
tesis tat to te e/tent a person fails to become attaced to te variety of control agencies of te society& is or er
cances of violating te la" are increased. -is doctrine edges very close to being self-evident in its insistence tat
close affiliation "it la"-abiding people& groups& and organi!ations is predictive of la"-abiding beavior& but it is
notably ric "it subordinate statements& some of tem far from obvious.
+0. ,ccording to $reud& te learned dictates of te social system are called1
,. Id
B. Su)erego
C. ?go
4. 2one of te above
$reud identified a tree-part structure to uman personality1 te id @te drive for food& se/& and oter life-sustaining
tingsA& te superego @te conscience "ic develops "en learned values become incorporated into a person*s
beaviorA& and te ego @te (I( or te product of te interaction bet"een "at a person "ants and "at is
conscience "ill allo" im to do to acieve "at e "antsA.
+6. Some criminologists tink tat crime rates are relatively stable7 tat is& te motivation to commit crime and te
supply of "illing offenders is fairly constant. -is teory of crime is called te1
,. Stable crime teory
#. Constant supply teory
C. 4eterrence teory
9. +outine activities theory
, variation of te classical teory& routine activities teory olds tat bot te motivation to commit crime and te
supply of "illing offenders is constant7 tere al"ays "ill be a certain number of people motivated by greed& lust& and
oter pro-crime forces. -e determining factor in predatory crimes @violent and teft-related crimesA is te activities
of te potential victims. -ere are purportedly tree variables1
E ,vailability of suitable targets
E ,bsence of capable guardians @suc as omeo"nersA
______________________________________________________________________________
E .resence of motivated offenders @suc as unemployed teenagersA
+8. Some criminologists old tat fraud offenders ave certain psycological caracteristics suc as psycopaty.
%o is responsible for te early development of psycoanalytical teoriesD
,. 4ollard
B. -reud
C. ?ysenck
4. Fuay
-eories rooted in psycology are based on te vie" tat criminal beavior is te product of mental processes. -e
psycoanalytical ideas of Sigmund $reud focus on early cildood development and on unconscious motivations&
tat is& motivations of "ic te offender imself is not a"are.
+6. 9any critics today claim tat one reason for significant "ite-collar crime is its (mild( punisment. %ic
pilosopy claims tat offenders "ill calculate potential gains and losses before tey decide to disobey te la"D
,. <outine activities teory
#. Conditioning teory
C. Utilitarianism
4. 2one of te above
Btilitarianism& first developed by ?nglis pilosoper Geremy #entam& remains a muc-favored approac to crime&
"it its assumption tat offenders "ill calculate potential gains and losses before tey decide to disobey te la". -e
B.S. Sentencing Commission proposals are based almost totally on tis idea& mandating tat monetary penalties be
calculated at a level tat "ill induce companies to conclude tat breaking te la" is not fiscally appealing.
+:. ,ccording to te differential reinforcement teory& te e/tent tat criminal beavior is perpetrated by a person
depends on te degree to "ic tat person as been eiter re"arded or punised for beavior.
7. !rue
#. $alse
,ccording to te differential reinforcement teory& people learn social beavior by operant conditioning& beavior
controlled by stimuli tat follo" te beavior. #eavior is reinforced "en positive re"ards are gained or
punisment is avoided @negative reinforcementA. It is "eakened by negative stimuli @punismentA and loss of re"ard
@negative punismentA. %eter deviant or criminal beavior is begun or persists depends on te degree to "ic it
as been re"arded or punised and te re"ards or punisments attaced to its alternatives. -is is te teory of
differential reinforcement.
______________________________________________________________________________
Sec. 1 - Criminology : / 66
III. %hite Collar Crime8888888888888888888888888888888888888888888888
+;. ,ccording to researc& most embe!!lers decide to commit teir crimes because1
,. -ey are essentially disonest
#. -ey ave drug problems
C. !hey are living ,eyond their means
4. 2one of te above
4onald <. Cressey found in a 1=80 study of embe!!lers tat most of tose e e/amined (ad lived beyond teir
means for some time before deciding to embe!!le.( 5ater autors ave e/tended tis statement more generally&
remarking& (-e most interesting fact about te "ite-collar offenders* aggregate financial status is not te value of
teir assets but te e/tent of teir liabilities.( >ffenders often (ave te material goods associated "it successful
people but may barely be olding teir financial selves togeter.( -ese people ave assembled a structure of
respectability& but it is often built on te sands of debt.
+=. -e typical "ite-collar crime offender is a "ite male "it a moderate social status.
7. !rue
#. $alse
-e "ide array of crimes called ("ite-collar(-from antitrust and securities violations to bank embe!!lement and
credit fraud-makes assembling a profile of te typical offender difficult& but not impossible. 9ost defendants are
"ite males& "it a moderate social status. -ey are sligtly more likely tan te general population to ave a ig
scool diploma @:; percent versus 6= percentA& or a college degree @+6.: percent versus 1= percent for te general
publicA.
00. %ite-collar crime defendants are more likely to receive bail tan (common criminals.(
7. !rue
#. $alse
%ite-collar defendants receive bail rater easily1 'ust one person in eigt spends any time incarcerated before trial&
and for te generally ig-status antitrust defendants& te figure is fe"er tan one in +0. #y comparison& in a control
group of (common criminals(-i.e.& people convicted of te (nonviolent economic crimes( of postal teft or postal
fraud-at least 1/0 of te defendants spent time in 'ail before going to trial.
01. ,ccording to criminologist Cerbert ?delert!& "ite-collar crime offenses can be divided into o" many
categoriesD
,. -"o
B. -our
C. -en
4. -"enty
Criminologists offer an array of breakdo"ns of "ite-collar offenses& eac one providing some analytical
advantages& and eac failing to meet te more rigorous scientific standards of precise categori!ation. >ne of te
better kno"n is tat by Cerbert ?delert!& a onetime federal prosecutor. ?delert! divides te offenses into four
ma'or types1
E ,d oc violations1 committed for personal profit on an episodic basis& for e/ample ta/ ceating
______________________________________________________________________________
Sec. 1 - Criminology ; / 66
E ,buses of trust1 committed by people in organi!ations against organi!ations& for e/ample& embe!!lement& bribery&
and kickbacks
E Collateral business crime1 committed by organi!ations in furterance of teir business interests& for e/ample& false
"eigts and measures& antitrust violations& and environmental crimes
E Confidence games1 offenses committed to ceat clients& for e/ample& fraudulent land and bogus securities sales
0+. Studies indicate tat "ite-collar offenses are seen by te public to be as serious if not more serious tan
traditional kinds of crime.
7. !rue
#. $alse
Studies indicate tat& at least in te abstract& "ite-collar offenses& particularly tose tat inflict pysical arm& are
seen by te public to be as serious if not more serious tan more traditional kinds of crime& tose offenses tat& as
one early criminologist noted& carry a (brimstone smell.(
00. ,ccording to te autors of (Crimes of te 9iddle Classes&( all of te follo"ing factors ave contributed to te
rising problem of economic crime ?HC?.-1
,. -e ,merican economy*s increased reliance on credit
#. -e continued pressures of an economic system tat re"ards affluence and success
C. !he over;helming de)endence on "oreign trade
4. -e increased opportunity for "rongdoing as a result of advancing information tecnologies
-e autors of (Crimes of te 9iddle Classes( posit several factors "ic ave contributed to te rising problem of
economic crime1
E ,merica*s economy increasingly runs on credit& "ic often means rising personal debt. -e offenders in te
sample often so"ed serious discrepancies (bet"een teir resources and teir commitments.(
E 2e" information tecnologies mean tat te opportunity for "rongdoing is gro"ing& and many of te tecni)ues
are not "idely compreended by businesses or individuals.
E Iovernment programs distributing large amounts of money make an enticing target for defalcations.
E -e importance of credentials in a professionali!ed society may influence individuals (to inflate te credentials& or
to make tem up "en tey do not e/ist.( -is tendency involves everyting from ceating on scool entrance
e/ams to falsifying credit applications.
E 9ost broadly& te autors observe an ,merican culture based on affluence and ever-iger levels of success. (-e
continued pressure of a value system tat re"ards economic affluence or its visible by-products as its effects on te
broad middle of ,merican society.( -elevision& and advertising in general& promise tat no one as to settle for
second best& prompting tose "o find temselves running beind to fudge te difference& crossing etical and
sometimes legal lines.
06. ,ccording to modern criminological studies& ________________ is/are te determinant aspect@sA of "ite-collar
crime.
,. Social status
#. $inancial constraints
C. 'rgani(ational o))ortunity
4. 2one of te above
>f all factors& organi!ational opportunity remains te determinant aspect of "ite-collar crime. ,gainst Suterland*s
empasis on an elite group running ig-class sting operations& later studies so" tat organi!ation and comple/ity
make a larger difference tan te offender*s social status.
______________________________________________________________________________
Sec. 1 - Criminology = / 66
08. 4onald <. Cressey*s 1=80 study of embe!!lers discovered tat most offenders appeared out"ardly successful but
"ere often mired in debt.
7. !rue
#. $alse
teir assets but te e/tent of teir liabilities.( >ffenders often (ave te material goods associated "it successful
people but may barely be olding teir financial selves togeter.( -ese people ave assembled a structure of
respectability& but it is often built on te sands of debt.
06. ,ccording to <eiss and #iderman& _____________________ violations are tose violations of la" to "ic
penalties are attaced tat involve te use of a violator*s position of economic po"er& influence& or trust in te
legitimate economic or political institutional order for te purpose of illegal gain& or to commit an illegal act for
personal or organi!ational gain.
,. >rgani!ed crime
#. ?nvironmental crime
C. 3iolent crime
9. %hite<collar crime
-oug tere is no consensus "itin te scolarly community& one definition today of "ite-collar crime is tat
proposed by ,lbert G. <eiss& Gr. and ,lbert #iderman1 %ite-collar crime violations are tose violations of la" to
"ic penalties are attaced tat involve te use of a violator*s position of economic po"er& influence& or trust in te
legitimate economic or political institutional order for te purpose of illegal gain& or to commit an illegal act for
personal or organi!ational gain.
0:. >ne criminologist studied embe!!lers and found tat many ad been living beyond teir means for some time
before tey started embe!!ling. -is criminologist is1
7. Cressey
#. #rait"aite
C. Ieis
4. 2one of te above
teir assets but te e/tent of teir liabilities.(
0;. In "ite-collar crime cases& te iger an offender*s status& te more likely tat person is to be imprisoned.
7. !rue
#. $alse
Considering all "ite-collar crime offenders& te iger an individual*s status& te more likely te person "as to be
imprisoned1 ,ll else being e)ual& doctors "ill ave about a 00 percent greater likeliood of being imprisoned for a
______________________________________________________________________________
"ite-collar crime tan truck drivers and almost a 10 percent greater likeliood tan managers. Gudges seem to find
persons of iger prestige more at fault& or in oter "ords& more blame"orty& in te commission of teir crimes.
0=. ,ccording to te autors of (Crimes of te 9iddle Classes&( tigtening restrictions on credit cards and loans "ill
ave little effect on economic crimes.
,. -rue
B. -alse
$urtermore& like many analysts tese days& te (Crimes...( team believes it is far too easy to ac)uire money and
goods on credit. -igtening te restrictions on credit cards and loans "ould directly address te role tat debt plays
in many scemes.
60. %ic of te follo"ing is considered one of te broad categories of "ite-collar crimeD
,. ,buses of trust
#. ,d oc violations
C. Collateral business crimes
9. 7ll o" the a,ove are ,road categories
Criminologists offer an array of breakdo"ns of "ite-collar offenses& eac one providing some analytical
advantages& and eac failing to meet te more rigorous scientific standards of precise categori!ation. >ne of te
better kno"n models "as prepared by Cerbert ?delert!& a onetime federal prosecutor. ?delert! divides te
offenses into four ma'or types1
E ,d oc violations1 committed for personal profit on an episodic basis& for e/ample ta/ ceating
E ,buses of trust1 committed by people in organi!ations against organi!ations& for e/ample& embe!!lement& bribery&
and kickbacks
E Collateral business crime1 committed by organi!ations in furterance of teir business interests& for e/ample& false
"eigts and measures& antitrust violations& and environmental crimes
E Confidence games1 offenses committed to ceat clients& for e/ample& fraudulent land and bogus securities sales
61. %ite-collar criminals are more likely to be fined tan to face prison terms as punisment.
7. !rue
#. $alse
9ore often tan prison& te punisment of coice for "ite-collar criminals is te imposition of fines. %ereas si/
percent of te (common criminals( in one notable survey received fines& all of te antitrust violators did.
60. (Social status( or (class( plays no role in te commission of "ite-collar crime.
,. -rue
B. -alse
%at is loosely called (class( or (social status( does ave an effect on crimes. $or e/ample& one defendant used is
position as cairman of a local bank board to set up loans for is ailing "ood cip company. -e loans "ould never
ave been approved "itout te cairman*s influence& and e never reported tem in is pro/y statement to te
bank*s sareolders.
6+. %ite-collar defendants are less likely to insist on a trial tan oter offenders.
,. -rue
______________________________________________________________________________
B. -alse
%ite-collar defendants are more likely to insist on a trial tan oter offenders. In at least =0 percent of federal
cases& defendants "ill plead guilty& avoiding te e/pense and effort of a trial. #ut& over 1; percent of defendants in
one notable study @as opposed to te usual 10 percentA pled (2ot Iuilty.( In cases like bank embe!!lement& usually
(simple cases "it clear evidence&( plea bargains are easily negotiated and (prosecutors may actively seek guilty
pleas.(
60. ,ccording to te autors of (Crimes of te 9iddle Classes&( television and advertising influence economic
crimes by promising tat no one as to settle for second best.
7. !rue
#. $alse
-e autors of (Crimes of te 9iddles Classes( observe an ,merican culture based on affluence and ever-iger
levels of success. (-e continued pressure of a value system tat re"ards economic affluence or its visible by-
products as its effects on te broad middle of ,merican society.( -elevision& and advertising in general& promise
tat no one as to settle for second best& prompting tose "o find temselves running beind to fudge te
difference& crossing etical and sometimes legal lines.
60.1. -e term ("ite-collar crime( "as first coined by _________________ in 4ecember 1=0= during an address
to te ,merican Sociological Society.
7. 5d;in H. Sutherland
#. Immanuel Jant
C. 4onald <. Cressey
4. 2one of te above
Since te term first "as used tere ave been constant disputes regarding "at is @or sould beA te definition of
"ite-collar crime. -e designation "as coined by ?d"in C. Suterland in 4ecember l=0= during is presidential
address in .iladelpia to te ,merican Sociological Society.
60.+ >ne criminologist studied embe!!lers and found tat many ad been living beyond teir means for some time
before tey started embe!!ling. -is criminologist is1
,. #rait"aite
B. Cressey
C. Ieis
4. 2one of te above
teir assets but te e/tent of teir liabilities.(
______________________________________________________________________________
Sec. 1 - Criminology 1+ / 66
I&. 'rgani(ational Crime88888888888888888888888888888888888888888888
66. %ite-collar offenses are usually punised by1
7. 7dministrative and=or civil )enalties
#. Civil penalties
C. Criminal penalties
4. ,dministrative penalties
>rgani!ational crime occurs in te conte/t of comple/ relationsips. %ite-collar crime is distinguised from lo"er
socio-economic crimes in terms of te structure of te violation and te fact tat administrative and civil penalties
are more likely to be used as punisment tan are criminal penalties.
68. -e e/istence of many speciali!ed departments "itin a company generally decreases te overall risk of fraud
by te organi!ation
,. -rue
B. -alse
Speciali!ation tends to ide illegal activities& especially "ere a firm*s tasks are kept separate and unrelated.
?mployees cannot garner kno"ledge about all te particulars of o" a firm "orks. -is protects a company from
te effects of personnel turnover and leaks of information& because no one can offer muc more tan a piece of te
'igsa" pu!!le tat paints te overall company picture. -e same secrecy& o"ever& raises te cances for
misconduct.
66. ,ccording to a study by Clinard and Keager& about "at percentage of $ortune 800 companies ave at least one
"ite-collar violationD
,. 00L
B. 2*>
C. 10L
4. 2one of te above
In a compreensive study of corporate la"-breaking& 9arsall Clinard @a recipient of te ,ssociation*s 4onald
Cressey ,"ardA and .eter Keager found tat l&880 "ite-collar crime cases ad been filed against te 86+ $ortune
800 businesses "ose records tey scrutini!ed for a t"o-year period. Some 60 percent of te firms ad at least one
case against tem7 for tose companies te average number of violations "as 6.6. -e oil& parmaceutical& and
motor veicle industries "ere te most likely to be carged for "rongdoing& a matter tat may be a function of
enforcement priorities or a true reflection of teir activities.
6:. Clinard and Keager believe corporate crimes are increasingly difficult to detect because1
7. &iolations are more com)le6
#. ,ccounting tecni)ues are more sopisticated
C. Criminals are smarter
4. 2one of te above
______________________________________________________________________________
Clinard and Keager believe tat corporate violations are increasingly difficult to discover& investigate& or prosecute
successfully because of teir gro"ing comple/ity and intricacy. -is is particularly true& tey believe& of antitrust
cases& foreign payoffs& computer fraud& and illegal political contributions.
6;. ,ccording to <obert J. 9erton& t"o key elements of cultural structure are goals and norms. %en goals receive
more empasis tan norms& te norms lose teir po"er to regulate beavior. -is produces a state called1
,. 3alidated norms
#. Cultural deviance
C. 7nomie
4. 2one of te above
-e sociologist <obert J. 9erton first teori!ed tat social structures provide motivation for misconduct. Ce also
states tat te interplay bet"een cultural structure and social structure produces deviance. -"o key elements of
cultural structure are te goals deemed "orty for all members of a society& and te norms tat spell out o" tose
goals may be legitimately acieved. %en goals receive more empasis tan norms& 9erton states& te norms "ill
lose teir po"er to regulate beavior. -is produces a state of (anomie&( or normlessness -- an important concept in
sociology tat is said to lead to la"lessness.
6=. In a comple/ organi!ational structure& it is less likely tat misbeavior "ill be detected and punised tan in a
simple organi!ational structure.
7. !rue
#. $alse
Comple/ companies provide a structure tat can foster misbeavior. -ey provide many settings "ere misconduct
is possible. -ey isolate tose settings in departments and in locations around a city& te country& or te "orld. -e
isolation& in turn& means tat information about "at one part of a company is doing may be unkno"n in anoter
part. ,ll tis reduces te risk tat misbeavior "ill be detected and punised. -e larger a company gro"s& te more
speciali!ed its sub-units tend to become. ,n internally diversified company may ave fe" employees "o fully
understand te detailed "orkings.
80. >ne sociological teory olds tat te nature of transactions prevents an organi!ation from discriminating in its
decision-making. ,s a result& companies employ (signals( and (inde/es( in making decisions. -is teory is called1
,. Signal inde/ing
B. ?ar@et signaling
C. Inde/ marketing
4. 2one of te above
9icael Spence*s (market signaling( teory olds tat te nature of transactions prevents an organi!ation from
discrimination in its decision-making. Companies employ signals and inde/es in making decisions on transactions
involving uncertainties. (Signals( are observable& alterable caracteristics suc as education& grades in scool& or 'ob
skills. (Inde/es( are observable& unalterable caracteristics suc as race or age. $raud can result "en signals are
falsified and an organi!ation*s monitoring systems allo" te falsification to pass unnoticed. -e key elements are1 a
transaction bet"een organi!ations7 a decision maker and a pool of applicants7 product uncertainty7 and ig
observation costs tat spur reliance on signals and inde/es.
81. ,n important concept in sociology tat is used to e/plain la"lessness is called (anomie.( -e t"o components of
anomie are1
______________________________________________________________________________
,. <ituals and goals
B. /oals and norms
C. 2orms and rituals
4. 2one of te above
-e sociologist <obert J. 9erton first teori!ed tat social structures provide motivation for misconduct. Ce also
states tat te interplay bet"een cultural structure and social structure produces deviance. -"o key elements of
social structure are te goals deemed "orty for all members of a society& and te norms tat spell out o" tey may
be legitimately acieved. %en te goals receive more empasis tan te norms& 9erton states& te norms "ill lose
teir po"er to regulate beavior. -is produces a state of (anomie&( or normlessness& an important concept in
sociology tat is said to lead to la"lessness.
8+. -"o criminologists conducted a compreensive study of $ortune 800 companies. -ey discovered tat 60
percent of te firms ad at least one "ite-collar crime case filed against tem in te t"o-year period of te study.
-ese t"o criminologists are1
,. %eisburd and #ode
B. Clinard and Aeager
C. Cagan and 2agel
4. ,lbonetti and %eeler
In a compreensive study of corporate la"-breaking& 9arsall Clinard @a recipient of te ,ssociation*s 4onald
Cressey ,"ardA and .eter Keager found tat l&880 "ite-collar crime cases ad been filed against te 86+ $ortune
800 businesses "ose records tey scrutini!ed for a t"o-year period. Some 60 percent of te firms ad at least one
case against tem7 for tose companies te average number of violations "as 6.6.
80. In te area of criminological teory& ____________ is te teory tat tries to prevent a crime before it occurs by
using te treat of criminal sanctions.
7. 9eterrence
#. .unisment
C. .revention
4. 2one of te above
,s a strategy to control crime& deterrence is designed to detect la" violations& determine "o is responsible& and
penali!e offenders in order to deter future violations. 4eterrence systems try to control te immediate beavior of
individuals& not te long-term beaviors targeted by compliance systems. 4eterrence teory assumes tat umans
are rational in teir beavior patterns. Cumans seek profit and pleasure "ile tey try to avoid pain. 4eterrence
assumes tat an individual*s propensity to"ard la"breaking is in inverse proportion to te perceived probability of
negative conse)uences.
86. 9any sociologists tink a company*s si!e contributes to organi!ational crimes. >ne of te reasons is tat te
large company becomes too un"ieldy for e/ecutives to manage. -is concept is called1
,. >rgani!ational distancing
B. 7uthority lea@age
C. 4epartmental distancing
______________________________________________________________________________
4. Communication degeneration
3augan "rites tat organi!ational gro"t naturally leads to a progressive loss of control over departments.
?/ecutives cannot ope to keep track of all te units of a large company& and must rely on subordinates to carry out
policy. 3augn states tat "en te distance bet"een top e/ecutives and subordinate units gro"s to a sufficient
level& (autority leakage( results. Suc leakage allo"s subsidiaries& company researcers& accountants or oter
departments to engage in misconduct since tere are inade)uate internal controls to ceck te beavior.
88. In a study of corporate crime& Clinard and Keager found small companies are more prone to commit financial
violations tan large ones.
,. -rue
B. -alse
In teir study of corporate criminality& Clinard and Keager found tat large corporations "ere far more likely to
commit violations tan small corporations. 5arge corporations also bear a disproportionate sare of sanctions for
serious or moderate violations.
86. Comple/ organi!ational structures can lead to fraud. , ___________ problem can occur "en te language&
rules& procedures& and recording systems of t"o organi!ations diverge to te point "ere te differences inibit&
rater tan promote& a transaction.
,. Signal inde/
B. System inter"ace
C. -ransactional interpretation
4. 2one of te above
, (system interface problem( occurs "en te language& rules& procedures& and recording systems of t"o
organi!ations diverge to te point "ere te differences inibit& rater tan promote& a transaction. If one or bot
organi!ations is un"illing or unable to resolve te problem troug legitimate means& te transaction system itself
may become te avenue for illegal activity. In tat case& te complicated nature of te transaction encourages
la"lessness& "it perpetrators figuring te cances of detection are small.
8:. -ransactions bet"een comple/ organi!ations sometimes can be an avenue for corporate misconduct or
organi!ational crimes. 3augn identified four distinguising caracteristics of transactions. %ic of te follo"ing
is 2>- one of temD
7. S)eci"ic monitoring )rocedures
#. <eliance on trust
C. $ormali!ation
4. Comple/ processing and recording metods
-ransactions bet"een comple/ organi!ations can add to te potential for misconduct by offering legitimate means of
pursuing scarce resources unla"fully and by providing an opportunity to ide unla"ful beavior. 3augan identified
four caracteristics of transactions1 formali!ation& comple/ processing and recording metods& reliance on trust& and
general rather than s)eci"ic monitoring )rocedures.
8;. Sociologist ?d"ard Iross as asserted tat all organi!ations are inerently criminogenic& tat is& prone to
committing fraud.
______________________________________________________________________________
7. !rue
#. $alse
Sociologist ?d"ard Iross as asserted tat all organi!ations are inerently criminogenic @tat is& prone to
committing crimeA& toug not necessarily criminal. Iross makes tis assertion because of te reliance on (te
bottom line.( %itout necessarily meaning to& organi!ations can invite fraud as a means of obtaining goals.
Criminologist >liver %illiamson noted tat because of a department*s concern "it reacing its goals& managers
migt "ell tend to ma/imi!e teir department*s o"n interests to te detriment of te organi!ation.
8=. Clinard and Keager& in teir studies& found tat illegal beavior by a corporation is most often suppressed by
consumer pressure.
,. -rue
B. -alse
If illegal beavior resulted in decreased patronage or even consumer boycotts& consumer pressure "ould be an
effective tool in te control of illegal corporate beavior. Co"ever& say Clinard and Keager& it appears to not be very
effective. Consumers often are una"are "en a corporation*s products are unsafe or "en it as been violating
antitrust la"s or polluting te environment. %itout organi!ed beavior& a consumer*s "itdra"al of individual
patronage generally is ineffective.
60. -ere are t"o primary strategies to control corporate criminal beavior. -ey are1
,. ?nforcement and compliance
#. 4eterrence and enforcement
C. Com)liance and deterrence
4. 2one of te above
?nforcement strategies include t"o main teories1 compliance and deterrence. Compliance opes to acieve
conformity to te la" "itout aving to detect& process& or penali!e violators. Compliance systems provide
economic incentives for voluntary compliance to te la"s and use administrative efforts to control violations before
tey occur. ,s a strategy to control crime& deterrence is designed to detect la" violations& determine "o is
responsible& and penali!e offenders in order to deter future violations. 4eterrence systems try to control te
immediate beavior of individuals& not te long-term beaviors targeted by compliance systems.
61. Several interrelated factors can cause a corporation to engage in illegal beavior. ,ccording to 9cCagy&
________________ is te single most compelling factor beind deviance by industry.
,. .oor communication
B. Pro"it )ressure
C. 5ack of etics
4. 2one of te above
9cCagy says profit pressure is (te single most compelling factor beind deviance by industry& "eter it be price
fi/ing& te destruction of competition or te misrepresentation of a product&( suc as making a soddy product tat
"ill "ear out and need to be replaced. Clinard and Keager say certain industries& suc as te drug and cemical
businesses& ave suc severe competition and strong profit drives due to demands for continual development of ne"
products tat tey may feel pressured to falsify test data& market ne" products before teir full effects are kno"n& or
engage in unetical sales tecni)ues tat can ave disastrous effects on uman beings and te environment.
______________________________________________________________________________
Sec. 1 - Criminology 1: / 66
6+. ?d"ard Iross and oter criminologists ave asserted tat organi!ations are inerently1
7. Criminogenic
#. ?/ploitative
C. Criminal
4. 2one of te above
?d"ard Iross as asserted tat all organi!ations are inerently (criminogenic( @prone to committing crimeA& but not
necessarily criminal. %itout necessarily meaning to& organi!ations can invite fraud as a means of obtaining goals.
Iross makes tis assertion because of te reliance on te (bottom line.(
60. ,s a strategy to control crime& _________ is designed to detect la" violations& determine "o is responsible& and
penali!e te offender to deter future violations.
,. .revention
B. 9eterrence
C. Compliance
4. 2one of te above
,s a strategy to control crime& deterrence is designed to detect la" violations& determine "o is responsible& and
penali!e offenders in order to deter future violations. 4eterrence teory assumes tat people are rational in teir
beavior patterns. .eople seek profit and pleasure "ile tey try to avoid pain. 4eterrence assumes tat an
individual*s propensity to"ard la"breaking is in inverse proportion to te perceived probability of negative
conse)uences.
66. Clinard and Keager& in teir studies& found tat mass media publicity "as te most feared conse)uence of
sanctions imposed on a corporation.
7. !rue
#. $alse
Clinard and Keager found tat mass media publicity about la" violations probably represents te most feared
conse)uence of sanctions imposed on a corporation.
68. Sociologists maintain tat comple/ organi!ational transactions can lead to unla"ful corporate conduct. ,s
organi!ations increase in comple/ity& te likeliood tat tey "ill engage in informal transactions generally
increases.
,. -rue
B. -alse
-ransactions bet"een comple/ organi!ations can add to te potential for misconduct by offering legitimate means of
unla"fully pursuing scarce resources. ,s organi!ations become more comple/& te likeliood tat tey "ill engage
in informal transactions diminises. ?/canges bet"een companies "ic are formal& comple/ and impersonal are
likely temselves to be formal& comple/ and impersonal. -is can lead to conditions ripe for misconduct.
66. ?fforts to control corporate crime follo" tree approaces. %ic of te follo"ing is/are includedD
,. 3oluntary canges in corporate attitudes
______________________________________________________________________________
Sec. 1 - Criminology 1; / 66
#. Consumer action
C. State intervention
9. 7ll o" the a,ove are a))roaches
?fforts to control corporate crime follo" tree approaces1 voluntary cange in corporate attitudes and structure7
strong intervention by te state to force canges in corporate structure& accompanied by legal measures to deter or
punis7 or consumer action. 3oluntary canges "ould involve te development of stronger business etics and
organi!ational reforms. Iovernment controls may involve federal corporate cartering& deconcentration and
divestiture& larger and more effective enforcement staffs& stiffer penalties& "ider use of publicity as a sanction& and
possibly te nationali!ation of corporations. Consumer group pressures may be e/erted troug lobbying& selective
buying& boycotts& and te establisment of large consumer cooperatives.
6:. Clinard and Keager found si/ main types of illegal corporate beavior. %ic of te follo"ing is 2>- one of te
classifications tey listedD
7. Com)liance violations
#. $inancial violations
C. ,dministrative violations
4. ,ll of te above are listed
Clinard and Keager found si/ types of violations common to corporations1 administrative& environmental& financial&
labor& manufacturing& and unfair trade practices. Certified $raud ?/aminers are most familiar "it financial
violations.
______________________________________________________________________________
Sec. 1 - Criminology 1= / 66
&. 'ccu)ational Crime88888888888888888888888888888888888888888888888
6;. Bnfair trade practices are one kind of "ite-collar offense. %ic of te follo"ing is generally considered one of
te classifications of unfair trade practicesD
,. 3ertical combinations
#. 9isrepresentation
C. 9onopoli!ation
9. 7ll o" the a,ove are un"air trade )ractices
Bnfair trade practices involve abuses of competition. ?/amples include monopoli!ation& price discrimination& credit
violations& misrepresentation& vertical and ori!ontal combinations& price fi/ing& bid rigging& illegal mergers& illegal
interlocking directorsips& and agreements among competitors to allocate markets& 'obs& customers& accounts& sales
and patents.
6=. -e criminologist responsible for te introduction of te ($raud Scale( model is ________________.
,. 4onald <. Cressey
B. 9r. Steve 7l,recht
C. ?d"in C. Suterland
4. 2one of te above
-o e/plain is concept& 4r. Steve ,lbrect developed te ($raud Scale&( "ic included te components of
situational pressures& perceived opportunities& and personal integrity. %en situational pressures and perceived
opportunities are ig and personal integrity is lo"& occupational fraud is muc more likely to occur tan "en te
opposite is true.
:0. >ne researcer found tat embe!!lers "ere likely to ave tree factors accounting for teir crimes1 immediate
financial need& perceived opportunity& and rationali!ation. -e person responsible for tis teory of embe!!lement
is1
,. ?d"in C. Suterland
B. 9onald +. Cressey
C. %illiam <.<. .arnell
4. 2one of te above
>ver te years& Cressey*s ypotesis as become more "ell kno"n as te (fraud triangle.( >ne leg of te triangle
represents a perceived unsarable financial need. -e second leg is for perceived opportunity& and te final is for
rationali!ation. -e role of te nonsarable problem is important. Cressey said& (%en te trust violators "ere asked
to e/plain "y tey refrained from violation of oter positions of trust tey migt ave eld at previous times& or
"y tey ad not violated te sub'ect position at an earlier time& tose "o ad an opinion e/pressed te e)uivalent
of one or more of te follo"ing )uotations1 @aA *-ere "as no need for it like tere "as tis time.* @bA *-e idea never
entered my ead.* @cA *I tougt it "as disonest ten& but tis time it did not seem disonest at first.*(
:1. ,ccording to Clinard and Keager& suc actions as commercial domestic bribery& illegal domestic political
contributions& and payments to foreign officials are classified as _______________violations.
7. -inancial
______________________________________________________________________________
Sec. 1 - Criminology +0 / 66
#. 5abor
C. ?nvironmental
4. ,dministrative
$inancial violations& according to Clinard and Keager& involve illegal payments or failure to disclose suc violations.
?/amples include commercial domestic bribery& illegal domestic political contributions& payments to foreign
officials& te conferring of illegal gratuities& and benefits and violations of foreign currency la"s. ?/amples of
securities-related violations are false and misleading pro/y materials& misuse of nonpublic material information& and
te issuance of false data.
:+. 2o model--not even Cressey*s (fraud triangle(--"ill fit every fraudulent situation.
7. !rue
#. $alse
Cressey*s classic fraud triangle elps e/plain te nature of many-but not all-occupational offenders. $or e/ample&
altoug academicians ave tested is model& it as still not fully found its "ay into practice in terms of developing
fraud prevention programs. Common sense dictates tat no one model--not even Cressey*s--fits every situation.
:0. -e term (occupational crime( covers at least four types of "ite-collar offenses. %ic of te follo"ing is one
of tose typesD
,. Crimes by professionals
#. Crimes by individuals
C. Crimes by organi!ations
9. 7ll o" the a,ove are ty)es
Iary Ireen& in oning te "ite-collar crime concept& uses te term (occupational crime&( "ic e defines as (any
act punisable by la" "ic is committed troug opportunity created in te course of an occupation "ic is
legal.( Ireen furter delineates occupational crime into four categories1
E Crimes for te benefit of an employing organi!ation @organi!ational occupational crimeA
E Crimes by officials troug e/ercise of teir state-based autority @state autority occupational crimeA
E Crimes by professionals in teir capacity as professionals @professional occupational crimeA
E Crimes by individuals as individuals
:6. ,ccording to a study conducted by 4r. Steve ,lbrect& college graduates are more likely tan non-college
graduates to spend te proceeds of an occupational crime on lu/uries& suc as e/travagant vacations or e/pensive
automobiles.
,. -rue
B. -alse
,ccording to 4r. Steve ,lbrect& perpetrators "o "ere interested primarily in (beating te system( committed
larger frauds. Co"ever& perpetrators "o believed teir pay "as not ade)uate committed primarily small frauds.
5ack of segregation of responsibilities& placing undeserved trust in key employees& imposing unrealistic goals& and
operating on a crisis basis "ere all pressures or "eaknesses associated "it large frauds. College graduates "ere less
likely to spend te proceeds of teir loot to take e/travagant vacations& purcase recreational property& support
e/tramarital relationsips& and buy e/pensive automobiles. $inally& tose "it lo"er salaries "ere more likely to
ave a prior criminal record.
______________________________________________________________________________
:8. Criminologist 4onald Cressey divided occupational crime offenders into tree categories. %ic of te
follo"ing is one of tose categoriesD
,. Independent businessmen
#. 5ong-term violators
C. ,bsconders
9. 7ll o" the a,ove are categories
$or furter analysis& Cressey divided te sub'ects into tree groups1 independent businessmen& long-term violators&
and absconders. Ce discovered tat eac group ad its o"n types of rationali!ations.
:6. ,ccording to te +006 <eport to te 2ation on >ccupational $raud and ,buse& frauds committed by o"ners and
e/ecutives ad a lo"er median loss tan tose committed by rank-and-file employees.
,. -rue
B. -alse
Ienerally speaking& te level of autority a person olds "itin an organi!ation "ill tend to ave te most
significant impact on te si!e of te loss in a fraud sceme. -e more autority an individual as& te greater tat
individual*s access to organi!ational resources& and te more ability tat person as to override controls in order to
conceal te fraud.
<espondents "ere asked to classify te principal perpetrator in eac sceme in one of tree categories1 @1A
employee7 @+A manager7 or @0A o"ner/e/ecutive. 9ost of te perpetrators "ere eiter employees @61.+LA or
managers @0=.8LA. >"ner/e/ecutives made up less tan one-fift of te perpetrators& but tey accounted for te
largest losses by far. -e median loss in a sceme committed by an o"ner or e/ecutive "as M1 million. -is "as
nearly five times more tan te median loss in a sceme committed by a manager @M+1;&000A and almost 10 times as
large as te median loss caused by employees @M:;&000A.
::. ,ccording to (-e $raud Scale&( occupational fraud is more likely to occur "en1
,. .erceived opportunities are ig
#. .ersonal integrity is lo"
C. Situational pressures are ig
9. 7ll o" the a,ove
4r. Steve ,lbrect developed te ($raud Scale&( "ic included te components of situational pressures& perceived
opportunities& and personal integrity tat "ere introduced by 4onald Cressey. -e $raud Scale so"s tat "en
situational pressures and perceived opportunities are ig and personal integrity is lo"& occupational fraud is muc
more likely to occur tan "en te opposite is true.
:;. ,ccording to criminologist 4onald Cressey& "ic of te follo"ing is 2>- essential to te commission of
fraudD
,. -ecnical skill
#. Information about company funds
C. 7,sence o" controls
4. ,ll of te above are essential
______________________________________________________________________________
Sec. 1 - Criminology ++ / 66
In Cressey*s vie"& tere "ere t"o components of te perceived opportunity to commit a trust violation1 general
information and tecnical skill. Ieneral information is simply te kno"ledge of o" te employee*s position of trust
could be violated. -ecnical skill refers to te ability to commit te violation.
:=. ,ccording to a study conducted by 4r. Steve ,lbrect& occupational crime perpetrators "o "ere interested
primarily in (beating te system( committed larger frauds.
7. !rue
#. $alse
;0. ,ccording to criminologist 4onald Cressey& one nonsarable problem "ic may lead to occupational crime is
poor employer-employee relationsips.
7. !rue
#. $alse
$inally& Cressey described problems resulting from employer-employee relationsips. -e most common& e stated&
"as an employed person "o resents is status "itin te organi!ation in "ic e is trusted. -e resentment can
come from perceived economic ine)uities& suc as pay& or from te feeling of being over"orked or
underappreciated. Cressey said tis problem becomes nonsarable "en te individual believes tat making
suggestions to alleviate is perceived maltreatment "ill possibly treaten is status in te organi!ation. -ere is also
a strong motivator for te perceived employee to "ant to (get even( "en e feels ill treated.
;1. ,ccording to a study conducted by 4r. Steve ,lbrect& occupational crime perpetrators "o believed teir pay
"as not ade)uate committed primarily large frauds.
,. -rue
B. -alse
;+. In te area of sanctions& criminologists ave found tat condemnation of family and friends is actually more of a
deterrent to crime tan going to prison for most people.
7. !rue
#. $alse
Social control in te "orkplace& according to Collinger and Clark& consists of bot formal and informal social
controls. -e former control can be described as e/ternal pressures troug bot positive and negative sanctions7 te
______________________________________________________________________________
latter& te internali!ation by te employee of te group norms of te organi!ation. -ese researcers& along "it a
ost of oters& ave concluded tat-as a general proposition-informal social controls provide te best deterrent.
(-ese data clearly indicate tat te loss of respect among one*s ac)uaintances "as te single most effective variable
in predicting future deviant involvement.( $urtermore& (in general& te probability of suffering informal sanction
is far more important tan fear of formal sanctions in deterring deviant activity.(
;0. ,ccording to <icard C. Collinger and Gon .. Clark& employees steal primarily as a result of "orkplace
conditions.
7. !rue
#. $alse
In 1=;0& <icard C. Collinger of .urdue Bniversity and Gon .. Clark of te Bniversity of 9innesota publised
federally funded researc involving surveys of nearly 10&000 ,merican "orkers. -eir book& (-eft by ?mployees&(
reaced a different conclusion tan Cressey. -ey concluded tat employees steal primarily as a result of "orkplace
conditions& and tat te true costs of te problem are vastly understated1 (In sum& "en "e take into consideration
te incalculable social costs . . . te grand total paid for teft in te "orkplace is no doubt grossly underestimated by
te available financial estimates.(
;6. Cressey found tat embe!!lers often e/perienced a sense of pysical isolation.
7. !rue
#. $alse
-e fourt category of nonsarable problems Cressey described is pysical isolation& in "ic te person in
financial straits is isolated from te people "o can elp im.
;8. 4onald <. Cressey developed a ypotesis tat as come to be kno"n as te (fraud triangle.( >ne leg of te
triangle represents a perceived unsarable financial need. -e second leg is for perceived opportunity& and te final
is for ________________.
,. Immediate financial resources
B. +ationali(ation
C. .erceived ac)uiescence
4. 2one of te above
>ver te years& Cressey*s ypotesis as become more "ell kno"n as te (fraud triangle.( >ne leg of te triangle
represents a perceived unsarable financial need. -e second leg is for perceived opportunity& and te final is for
rationali!ation. -e role of te nonsarable problem is important. Cressey said& (%en te trust violators "ere asked
to e/plain "y tey refrained from violation of oter positions of trust tey migt ave eld at previous times& or
"y tey ad not violated te sub'ect position at an earlier time& tose "o ad an opinion e/pressed te e)uivalent
of one or more of te follo"ing )uotations1 @aA *-ere "as no need for it like tere "as tis time.* @bA *-e idea never
entered my ead.* @cA *I tougt it "as disonest ten& but tis time it did not seem disonest at first.*(
;6. -e criminologist responsible for te "ell-kno"n ypotesis of te (fraud triangle( is1
,. 9arsall #. Clinard
C. Immanuel Jant
4. 2one of te above
______________________________________________________________________________
>ver te years& 4onald <. Cressey*s ypotesis as become more "ell kno"n as te (fraud triangle.( >ne leg of te
is for rationali!ation. -e role of te nonsarable problem is important. Cressey said& (%en te trust violators "ere
asked to e/plain "y tey refrained from violation of oter positions of trust tey migt ave eld at previous times&
or "y tey ad not violated te sub'ect position at an earlier time& tose "o ad an opinion e/pressed te
e)uivalent of one or more of te follo"ing )uotations1 @aA *-ere "as no need for it like tere "as tis time.* @bA *-e
idea never entered my ead.* @cA *I tougt it "as disonest ten& but tis time it did not seem disonest at first.*(
;:. -e criminologist responsible for te "ell-kno"n ypotesis of te (fraud triangle( is1
,. 9arsall #. Clinard
C. Immanuel Jant
4. 2one of te above
>ver te years& 4onald <. Cressey*s ypotesis as become more "ell kno"n as te (fraud triangle.( >ne leg of te
is for rationali!ation. -e role of te nonsarable problem is important. Cressey said& (%en te trust violators "ere
asked to e/plain "y tey refrained from violation of oter positions of trust tey migt ave eld at previous times&
or "y tey ad not violated te sub'ect position at an earlier time& tose "o ad an opinion e/pressed te
e)uivalent of one or more of te follo"ing )uotations1 @aA *-ere "as no need for it like tere "as tis time.* @bA *-e
idea never entered my ead.* @cA *I tougt it "as disonest ten& but tis time it did not seem disonest at first.*(
;;. Collinger and Clark found in teir researc on employee misconduct tat property violations "ere t"o to tree
times more common tan production deviance.
,. -rue
B. -alse
Collinger and Clark found tat production deviance "as t"o to tree times more common tan property violations.
______________________________________________________________________________
&I. +es)onsi,ility "or -raud Prevention88888888888888888888888888888888
;=. -e -read"ay Commission& formed in 1=;: "it te purpose of defining te responsibility of te auditor in
preventing and detecting fraud& made "ic of te follo"ing recommendationsD
,. , %ritten Company Carter
#. ,de)uate ,udit <esources and ,utority
C. , 9andatory Independent ,udit Committee
9. 7ll o" the a,ove are !read;ay recommendations
-e -read"ay Commission made four ma'or recommendations tat& in combination "it oter measures& are
designed to reduce te probability of fraud in financial reports1
E 9andatory Independent ,udit Committee. ?very board of directors sould ave an audit committee made up of
outside directors.
E %ritten Carter. Companies sould develop a "ritten carter "ic sets fort te duties and responsibilities of te
audit committee.
E <esources and ,utority. -e audit committee sould ave ade)uate resources and autority to carry out its
responsibilities.
E Informed& 3igilant& and ?ffective ,udit Committees. -e audit committee members must be informed& vigilant&
and effective.
=0. -e e/istence of a toroug control system is essential to fraud prevention.
7. !rue
#. $alse
$raud prevention re)uires a system of rules& "ic& in teir aggregate& minimi!e te likeliood of fraud occurring
"ile ma/imi!ing te possibility of detecting any fraudulent activity tat may transpire. -e potential of being
caugt most often persuades likely perpetrators not to commit te fraud. #ecause of tis principle& te e/istence of a
toroug control system is essential to fraud prevention.
=1. C>S> identified five interrelated components of internal control. -e report also states tat te effectiveness of
internal controls can be determined from an assessment of "eter tese five components are in place and
functioning effectively.
7. !rue
#. $alse
C>S> identified five interrelated components of internal control. -e effectiveness of internal controls can be
determined from an assessment of "eter tese five components are in place and functioning effectively. -e five
components are control environment& risk assessment& control activities& information and communication& and
monitoring.
=+. ,ccording to te C>S> report& tere are five interrelated components of a company*s internal control. %ic of
te follo"ing are 2>- among C>S>*s componentsD
7. 56ecutivesB 7uthority
#. 9onitoring
C. <isk ,ssessment
4. Control ,ctivities
______________________________________________________________________________
C>S> identified five interrelated components of internal control. -e effectiveness of internal controls can be
determined from an assessment of "eter tese five components are in place and functioning effectively. -e five
components are control environment& risk assessment& control activities& information and communication& and
monitoring.
=0. Corporations and oter organi!ations cannot be eld liable for te criminal acts of teir employees.
,. -rue
B. -alse
Corporations and oter organi!ations can be eld liable for criminal acts committed as a matter of organi!ational
policy. $ortunately& most organi!ations do not e/pressly set out to break te la". Co"ever& corporations and oter
organi!ations may also be eld liable for te criminal acts of teir employees if tose acts are done in te course and
scope of teir employment and for te ostensible purpose of benefiting te corporation.

=6. , corporation cannot be eld criminally liable for te actions of its employees if management ad no kno"ledge
or participation in te criminal events.
,. -rue
B. -alse
-e corporation can be eld criminally responsible even if tose in management ad no kno"ledge or participation
in te underlying criminal events and even if tere "ere specific policies or instructions proibiting te activity
undertaken by te employees. -e acts of any employee& from te lo"est clerk on up to te C?>& can impute
liability upon a corporation.
=8. , company can avoid liability for te acts of its employees by claiming tat it did not kno" "at its employee
"as engaged in.
,. -rue
B. -alse
, company cannot seek to avoid vicarious liability for te acts of its employees by simply claiming tat it did not
kno" "at "as going on. 5egally speaking& an organi!ation is deemed to ave kno"ledge of all facts kno"n by its
officers and employees. -at is& if te government can prove tat an officer or employee kne" of conduct tat raised
a )uestion as to te company*s liability& and te government can so" tat te company "illfully failed to act to
correct te situation& ten te company may be eld liable& even if senior management ad no kno"ledge or
suspicion of te "rongdoing.
=6. C>S> recommends tat corporations engage in background cecks of managerial employees in particular.
7. !rue
#. $alse
>ne of te easiest "ays to establis a strong moral tone for an organi!ation is to ire morally sound employees. -oo
often& te iring process is conducted in a slipsod manner. >rgani!ations sould conduct toroug background
cecks on all ne" employees& especially managers. In addition& it is important to conduct toroug intervie"s "it
applicants to ensure tat tey ave ade)uate skills to perform te duties tat "ill be re)uired of tem.
=:. -e commission formed in 1=;: "it te purpose of defining te responsibility of te auditor in preventing and
detecting fraud is kno"n as te1
,. Iepart Commission
______________________________________________________________________________
Sec. 1 - Criminology +: / 66
B. !read;ay Commission
C. Jlaas Commission
4. 2one of te above
-e 2ational Commission on $raudulent $inancial <eporting @commonly kno"n as te -read"ay CommissionA "as
establised in 1=;: "it te purpose of defining te responsibility of te auditor in preventing and detecting fraud.
-e commission "as formed by te ma'or professional auditing organi!ations-te ,merican Institute of C.,s& te
Institute of Internal ,uditors& and te 2ational ,ssociation of ,ccountants.
______________________________________________________________________________
Sec. 1 - Criminology +; / 66
&II. Cor)orate Sentencing /uidelines8888888888888888888888888888888888
=;. , fraud prevention program "ill generally not be effective if a company does not punis employees "o violate
te program.
7. !rue
#. $alse
?nforcing a compliance program means adering to a system of disciplinary actions for rulebreakers. ?mployees
must kno" tat if tey violate te company*s compliance policy& tey "ill be punised. -e opportunity to commit
fraud is psycologically more acceptable "en employees believe fraud normally goes undetected and
unprosecuted. 2e" employees sould be advised of te compliance program at te time of ire& and sould sign an
annual statement ackno"ledging teir understanding of it. -e range of possible punisments for violations of te
policy sould be spelled out.
==. %ic of te follo"ing is a good metod of discovering internal fraudD
,. Surprise audits
#. <e)uiring employees to take vacation time
C. <otating employee duties
9. 7ll o" the a,ove are methods
.roactive fraud policies are generated from te top of te operation. , proactive policy means tat te organi!ation
"ill aggressively seek out possible fraudulent conduct& instead of "aiting for instances to come to its attention. -is
can be accomplised by several means& including te use of analytical procedures& fraud assessment )uestioning&
enforcement of mandatory vacations& 'ob rotation& and surprise audits "ere possible.
100. 9ost e/perts agree tat it is muc easier to detect fraud tan it is to prevent it.
,. -rue
B. -alse
9ost e/perts agree tat it is muc easier to prevent tan detect fraud. -o prevent fraud& "e sould understand
someting about te mind of te potential perpetrator. Increasing te perception of detection migt be te most
effective fraud prevention metod. Controls& for e/ample& do little good in forestalling teft and fraud& if tose at
risk do not kno" of te presence of possible detection.
101. 9ost e/perts do not believe tat offering re"ards in e/cange for information about criminal events is an
effective fraud prevention tecni)ue unless te re"ard e/ceeds M8&000.
,. -rue
B. -alse
Some companies ave a policy of re"arding information tat leads to te recovery of mercandise& property& or
money. >ters offer re"ards upon te criminal conviction of te person@sA involved. If a re"ard policy e/ists& strict
criteria sould establis re"ard payments& and suc proposed policies sould be revie"ed and approved by counsel.
-e amount of re"ard paid by companies varies from fi/ed fees to a percentage of te recovery. Studies indicate
tat re"ards sould not e/ceed a fe" tousand dollars. Crime Stoppers recommends re"ards not e/ceeding M1&000.
10+. ,n e/cellent metod for uncovering fraud "itin an organi!ation is to ask te organi!ation*s employees about
possible fraudulent activities.
______________________________________________________________________________
Sec. 1 - Criminology += / 66
7. !rue
#. $alse
$raud ,ssessment Fuestioning is a nonaccusatory intervie" tecni)ue used as a part of a normal audit. It operates
on te teory tat employees* attitudes are a good indicator of potential problems& and tat one of te most effective
"ays to deal "it fraud is to ask about it.
100. %ic of te follo"ing types of personnel can potentially bind a corporation troug teir o"n misconductD
,. 5o"-level employees
#. Independent contractors
C. ?/ecutive officers and directors
9. 7ll o" the a,ove
-e corporate compliance policy sould be communicated to everyone "o can potentially bind a corporation
troug teir o"n misconduct. -is includes te follo"ing1
E ?/ecutive officers and directors
E 9anagers and supervisors
E 5o"-level employees
E Independent contractors
106. It is generally not a good idea to ask employees in your organi!ation "eter or not tey believe fraud is
occurring because it gives te impression tat management is una"are of te fraud risks of te organi!ation.
,. -rue
B. -alse
$raud ,ssessment Fuestioning is a nonaccusatory intervie" tecni)ue used as a part of a normal audit. It operates
on te teory tat employees* attitudes are a good indicator of potential problems& and tat one of te most effective
"ays to deal "it fraud is to ask about it.
108. ,ccording to te Corporate Sentencing Iuidelines& a corporate policy tat mitigates te effect of an occurrence
of fraud can reduce an organi!ation*s fine by as muc as =8L.
7. !rue
#. $alse
$ines are based on t"o factors1 te seriousness of te offense and te level of culpability by te organi!ation. -e
seriousness of te offense determines te base fine to be imposed. -is figure can be )uite ig. -e organi!ation*s
culpability is a measure of te actions taken by te organi!ation "ic eiter mitigated or aggravated te situation.
4epending on te culpability of te organi!ation& te base fine can be increased by as muc as 600L or reduced by
as muc as =8L.
106. -e Corporate Sentencing Iuidelines provide several possible punisments for an organi!ation tat is found
liable for an offense. %ic of te follo"ing is 2>- an optionD
,. <estitution
B. Prison Sentences
C. $ines
______________________________________________________________________________
4. ,ll of te above
If an organi!ation is found liable for an offense& te guidelines provide for four types of remedies1 fines& restitution&
remedial orders& and probation. Individual perpetrators may& o"ever& face prison sentences.
10:. Bnder te Corporate Sentencing Iuidelines& a corporation convicted of a felony is re)uired to serve a probation
bet"een1
,. $ive and ten years
B. 'ne and "ive years
C. >ne and ten years
4. >ne and tree years
%ere te offending organi!ation as committed a felony& probation must run for at least one year. In no case may
probation run for more tan five years.
10;. -e board of directors does not necessarily ave to be kno"ledgeable about te implementation of an
organi!ation*s compliance and etics program if tey ave delegated tat responsibility to a compliance officer.
,. -rue
B. -alse
-e Iuidelines re)uire tat te company*s (governing autority( sall be kno"ledgeable about te content and
operation of te compliance and etics program and sall e/ercise reasonable oversigt "it respect to te
implementation and effectiveness of te program. (Ioverning autority( is defined as te board of directors& or if
te organi!ation does not ave a board of directors& te igest-level governing body of te organi!ation. ,ltoug
day-to-day operations of te program can be delegated& te duties outlined above cannot.
10=. -e $ederal Sentencing Iuidelines re)uire an organi!ation to consider "ic of te follo"ing factors "en
designing an effective compliance and etics programD
,. Si!e of organi!ation
#. <ecurrence of similar conduct
C. Industry si!e and practice
9. 7ll o" the a,ove
-e $ederal Sentencing Iuidelines re)uire an organi!ation to consider te follo"ing factors "en designing an
effective compliance and etics program1
1. ,pplicable industry si!e and practice - ,n organi!ation*s failure to incorporate and follo" industry practice or te
standards called for by any applicable government regulation "eigs against a finding tat te program is effective.
+. Si!e of te organi!ation - 5arge organi!ations are e/pected to devote more formal operations and greater
resources to meeting te re)uirements tan are small organi!ations. $or e/ample& smaller organi!ations may use
available personnel rater tan employ separate staff to carry out etics and compliance.
0. <ecurrence of similar misconduct - -e recurrence of a similar event creates doubt as to "eter te organi!ation
took reasonable steps to meet te re)uirements.
110. -e Bnited States Sentencing Commission "as formed to address te belief in Congress tat1
,. .risoners "ere being released too early
B. 7 great dis)arity e6isted in )enalties "or similar crimes
______________________________________________________________________________
C. -e 4epartment of Gustice "as soft on crime
4. $raud "as rampant in ,merican business
Congress& in te Compreensive Crime Control ,ct of 1=;6& mandated te uniform sentencing guidelines. -e act
also establised te Bnited States Sentencing Commission @BSSCA "ic began studying sentences for individuals
soon after te passage of te act. It "as "idely eld in Congress tat tere "as a great disparity of penalties for
similar crimes committed by individuals. ,fter tree years of study& te BSSC announced Sentencing Iuidelines for
Individuals. In 2ovember of 1=;:& tese guidelines "ere applied in te =6 $ederal Courts of te Bnited States.
111. In order for its compliance program to be considered effective under te $ederal Sentencing Iuidelines& te
organi!ation must communicate its program to all its employees. ,ltoug training regarding te program is
encouraged& it is not re)uired by te Iuidelines.
,. -rue
B. -alse
Bnder te Sentencing Iuidelines& organi!ations 9BS- conduct (effective training programs.( >rgani!ations are
also re)uired to periodically and appropriately communicate te program*s compliance re)uirements and procedures
to all employees affected by te program& including upper-level personnel. -ese programs sould be designed to
inform employees about te company*s stance on corporate compliance. -ey sould also inform employees about
"at kinds of acts and omissions are proibited by te la" and by te organi!ation.
11+. Bnder te Corporate Sentencing Iuidelines& if an offending organi!ation violates its probation& te penalties
can include any of te follo"ing options ?HC?.-1
,. <esentencing
B. Ce; trial
C. -e imposition of more restrictive conditions
4. 2one of te above
If an offending organi!ation violates its probation& tis may result in1
E <esentencing
E -e terms of probation being e/tended
E -e imposition of more restrictive conditions
110. -e $ederal Sentencing Iuidelines re)uire tat a compliance and etics program be reasonably designed&
implemented& and enforced so tat it is generally effective in preventing and detecting criminal conduct.
7. !rue
#. $alse
-e Iuidelines re)uire tat a compliance and etics program be reasonably designed& implemented& and enforced so
tat it is generally effective in preventing and detecting criminal conduct. Co"ever& tis section furter provides
tat te failure to prevent or detect te offense in )uestion does not necessarily mean tat te program is ineffective.
116. Bnder te Corporate Sentencing Iuidelines& courts are re)uired to impose probation on offending organi!ations
under all of te follo"ing circumstances ?HC?.-1
,. In te instance tat te sentence did not include any fine
B. I" the organi(ation has not )reviously committed similar misconduct
______________________________________________________________________________
C. -o secure payment of restitution
4. ,ll of te above are mandatory probation situations
Courts are re)uired to impose probation on offending organi!ations under te follo"ing circumstances1
E -o secure payment of restitution& enforcement of a remedial order& or to ensure completion of community service
E -o safeguard te organi!ation*s ability to pay a monetary penalty tat "as not fully paid at te time of sentencing
E %en an organi!ation "it at least 80 employees did not ave an effective program to detect and prevent
violations of la"
E %en te organi!ation "as ad'udicated "itin te past five years to ave committed misconduct similar to any
part of te misconduct of te instant offense
E %en suc an order is necessary to ensure canges are made to reduce te likeliood of future criminal conduct
E %en te sentence does not include a fine
E %en suc an order is necessary in order to accomplis one or more purposes of sentencing set fort in 1; B.S.C.&
Section 0880@aA@+A
118. Bnder te Corporate Sentencing guidelines& an organi!ation*s base fine is te lo"est of tree numbers1
E -e monetary loss suffered by te victim&
E -e pecuniary gain received by te defendant& or
E ,n amount ranging from M8&000 to M:+&800&000 as set fort in te >ffense 5evel Scale Individual Iuidelines. -is
is a table of preset penalties based on te seriousness of possible offenses.
,. -rue
B. -alse
Bnder te Corporate Sentencing guidelines& an organi!ation*s base fine is te igest of tree numbers1
E -e monetary loss suffered by te victim&
E -e pecuniary gain received by te defendant& or
E ,n amount ranging from M8&000 to M:+&800&000 as set fort in te >ffense 5evel Scale Individual Iuidelines. -is
is a table of preset penalties based on te seriousness of possible offenses.
116. ,ccording to te Corporate Sentencing Iuidelines& te payment of full restitution to victims of crime is
considered an ade)uate form of punisment.
,. -rue
B. -alse
-e guidelines re)uire tat& "enever possible& te organi!ation must pay full restitution to te victims of te crime.
<estitution is not vie"ed as a form of punisment in te guidelines& but rater as a means of remedying te arm
caused by te offense.
11:. ,ccording to te Corporation Sentencing Iuidelines& te presence of an effective program to prevent and detect
fraud "itin a company can lead to more lenient sentences in te event of criminal activity.
7. !rue
#. $alse
-e introductory commentary to te Iuidelines clearly states tat tey are designed to provide incentives for
organi!ations to maintain internal mecanisms for preventing& detecting& and reporting criminal conduct. ,mong
oter tings& te Iuidelines suggest a substantial reduction of fines for organi!ations tat ave effective compliance
programs.
______________________________________________________________________________
&III. -raud Prevention Policy88888888888888888888888888888888888888888
11;. , multi-million dollar fraud as occurred at te HKN company. , mid-level manager inflated revenue figures
in order to meet )uarterly targets. -e officers and directors of HKN did not kno" te fraud "as occurring7
terefore& te company cannot be eld criminally liable for te fraud.
,. -rue
B. -alse
liability upon a corporation. In fact& a corporation can be criminally responsible for te collective kno"ledge of
several of its employees even if no single employee intended to commit an offense. -us& te combination of
vicarious or imputed corporate criminal liability and te ne" Sentencing Iuidelines for >rgani!ations creates an
e/traordinary risk for corporations today.
11=. ,s a general proposition& increasing te perception of detection is te single most effective metod of fraud
prevention.
7. !rue
#. $alse
Increasing te perception of detection may "ell be te most effective fraud prevention metod. Controls& for
e/ample& do little good in forestalling internal teft and fraud if teir presence is not kno"n by tose at risk. In te
audit profession& tis means letting employees& managers& and e/ecutives kno" tat auditors are actively seeking out
information concerning internal teft.
1+0. Bnless specific unacceptable conduct is detailed in a fraud prevention policy& tere can be legal problems in
discarging a disonest employee.
7. !rue
#. $alse
9any companies ave learned tat it is best to spell out specific unacceptable conduct. If te type of conduct tat is
considered unacceptable is not accurately detailed& tere migt be legal problems in discarging a disonest
employee. Ceck "it your counsel regarding any legal considerations "it respect to a fraud policy. >ne of te
most important legal considerations is to ensure everyone and every allegation is andled in a uniform manner.
1+1. %ic of te follo"ing affects te etical decisions of employeesD
,. Social pressures
#. Industry and organi!ational etical codes
C. -e la" and oter government regulations
9. 7ll o" the a,ove
-e collection of a person*s beliefs and morals makes up a set of principles kno"n as etics. ?tics are te
'udgments about rigt and "rong or& more specifically& a person*s moral obligations to society tat determine a
person*s actions. 4etermining etical rigts and "rongs is complicated by te fact tat moral standards and generally
accepted social beavior cange "it time. In addition& different groups in te same society may ave conflicting
ideas of rigt and "rong. -ese values and etics of an individual are reflected in teir actions as employees. -ere
are four factors tat generally affect te etical decisions of employees1
______________________________________________________________________________
E -e la" and oter government regulations
E Industry and organi!ational etical codes
E Social pressures
E -ension bet"een personal standards and organi!ational needs
1++. ,s long as a company as a detailed fraud policy in place& tere is little need to communicate te policy to
employees.
,. -rue
B. -alse
It obviously does little good to ave a fraud or etics policy if it is not communicated to te employees. -is
communication can be accomplised in several "ays. -e communication of te policy sould be presented in a
positive& nonaccusatory manner.
1+0. , detailed fraud prevention policy can give management legal grounds to investigate and punis violators.
7. !rue
#. $alse
,n (action constituting fraud( section in a fraud prevention policy sets fort in detail "at actions constitute
fraudulent conduct. -is is important as it gives management te legal grounds to investigate and punis violators.
-e actions listed can include1
E ,ny disonest or fraudulent act
E $orgery or alteration of documents
E 9isapplication of funds or assets
E Impropriety "it respect to reporting financial transactions
E .rofiting on insider kno"ledge
E 4isclosing securities transactions to oters
E ,ccepting gifts from vendors
E 4estruction or disappearance of records or assets
E ,ny similar or related irregularity
1+6. , million dollar fraud as occurred at te ,#C company. %ic of te follo"ing conditions could make ,#C
criminally responsible for te acts of its employeesD
,. 9anagement kne" of te events
#. Collective kno"ledge of te fraud by employees
C. 9anagement actively participated
9. 7ny o" the a,ove
liability upon a corporation. In fact& a corporation can be criminally responsible for te collective kno"ledge of
several of its employees even if no single employee intended to commit an offense. -us& te combination of
vicarious or imputed corporate criminal liability and te ne" Sentencing Iuidelines for >rgani!ations creates an
e/traordinary risk for corporations today.
1+8. %ic of te follo"ing are considered fraud prevention metodsD
,. <e"ards
______________________________________________________________________________
#. <eporting programs
C. Cotlines
9. 7ll o" the a,ove are methods
e/ample& do little good in forestalling teft and fraud if teir presence is not kno"n by tose at risk. -is means
letting employees& managers& and e/ecutives kno" tat auditors are actively seeking out information concerning
internal teft. -is can be accomplised in several "ays& suc as1 employee education& reporting programs& otlines&
re"ards& and proactive audit policies.
1+6. %ic of te follo"ing sould be empasi!ed in an employee reporting programD
I. $raud& "aste& and abuse occur in only a fe" companies.
II. -e company actively encourages employees "it information to come for"ard.
III. -e employee*s name must be disclosed.
I3. -e report need not be made to one*s immediate supervisor
,. II. and III.
#. I.& II.& III. and I3.
C. I.& II.& and I3.
9. II. and I&.
?ac employee in te company sould kno" "ere to report suspicious& unetical& or illegal beavior. , reporting
program sould empasi!e tat E $raud& "aste& and abuse occurs in nearly all companies E Suc conduct costs te
company 'obs and profits E -e company actively encourages any employee "it information to be able to come
for"ard E -e employee can come for"ard and provide information anonymously and "itout fear of recrimination
for good fait reporting E -ere is an e/act metod for reporting7 i.e.& a telepone number& name& or oter
information E -e report need not be made to one*s immediate superiors.
1+:. %ic of te follo"ing is one of te factors tat affects te etical decisions of employeesD
,. -e la" and oter government regulations
#. Industry and organi!ational etical codes
C. -ension bet"een personal standards and organi!ational needs
9. 7ll o" the a,ove are "actors
-e collection of a person*s beliefs and morals makes up a set of principles kno"n as etics. ?tics are te
'udgments about rigt and "rong or& more specifically& a person*s moral obligations to society tat determine a
person*s actions. 4etermining etical rigts and "rongs is complicated by te fact tat moral standards and generally
accepted social beavior cange "it time. In addition& different groups in te same society may ave conflicting
ideas of rigt and "rong. -ese values and etics of an individual are reflected in teir actions as employees. -ere
are four factors tat generally affect te etical decisions of employees1
E -e la" and oter government regulations
E Industry and organi!ational etical codes
E Social pressures
E -ension bet"een personal standards and organi!ational needs
1+;. 9ost e/perts agree tat it is easier to prevent frauds tan to detect tem.
7. !rue
______________________________________________________________________________
#. $alse
9ost e/perts agree tat it is muc easier to prevent tan detect fraud. -o prevent fraud& te fraud e/aminer sould
understand someting about te mind of te potential perpetrator. Increasing te perception of detection migt be te
most effective fraud prevention metod. Controls& for e/ample& do little good in forestalling teft and fraud if tose
at risk do not kno" of te presence of possible detection.
1+=. %ic of te follo"ing is 2>- considered a part of a proactive audit policyD
,. $raud assessment )uestioning
B. 9ecreased use o" analytical revie;
C. ?nforced mandatory vacations
4. Surprise audits
.roactive fraud policies are generated from te top of te operation. , proactive policy simply means tat te
companies "ill aggressively seek out possible fraud& instead of "aiting for instances to be oter"ise uncovered.
-is can be accomplised by several means& including1 @1A increased use of analytical revie"& @+A fraud assessment
)uestioning& @0A enforcement of mandatory vacations& @6A 'ob rotation& and @8A surprise audits "ere feasible.
100. If an action is legal it is also etically correct.
,. -rue
B. -alse
, common fallacy in discussions about etics is (If it*s legal& it*s etical.( , common defense to carges of unetical
beavior is to invoke te la". -is legalistic approac to etics mistakenly implies tat actions tat are not e/plicitly
proibited by te la" are etical. -e main error in tis approac is tat legal standards do not establis etical
principles. ,ltoug abiding by te la" is a part of etical beavior& la"s temselves do not describe o" an etical
person sould beave. >ne can be disonest& unprincipled& untrust"orty& unfair& and uncaring "itout breaking te
la".
101. Iiven all of te follo"ing fraud prevention metods "itin organi!ations& "ic one is probably te most
effectiveD
,. <educing rationali!ation
B. Increasing the )erce)tion o" detection
C. Caving an open-door policy
4. Screening employees
e/ample& do little good in forestalling internal teft and fraud if teir presence is not kno"n by tose at risk. In te
audit profession& tis means letting employees& managers& and e/ecutives kno" tat auditors are actively seeking out
information concerning internal teft.
10+. ,ccording to te $ederal Sentencing Iuidelines& a corporation cannot be eld responsible for te criminal acts
of its employees.
,. -rue
B. -alse
______________________________________________________________________________
Corporations and oter organi!ations can be eld liable for criminal acts committed as a matter of organi!ational
policy. $ortunately& most organi!ations do not e/pressly set out to break te la". Co"ever& corporations and oter
organi!ations may also be eld liable for te criminal acts of teir employees if tose acts are done in te course and
scope of teir employment and for te ostensible purpose of benefiting te corporation. ,n employee*s acts are
considered to be in te course and scope of is employment if te employee as actual autority or apparent
autority to engage in tose acts.
100. -"o selling points of a fraud prevention program are fraud*s potentially negative impact on a company*s profits
and public image.
7. !rue
#. $alse
>ne of te best "ays to sell management on fraud prevention is by so"ing te impact on te bottom line. $raud
impacts net sales dollar for dollar. $or e/ample& if a company nets +0 percent on sales& tey must sell five items at
regular prices to recover losses from te teft of one item. $raud can be very e/pensive. ,dditionally& many
corporate e/ecutives are more sensitive to adverse publicity tan almost any oter issue. Certainly& one "ay to
convince management of te logic of fraud prevention is to point out tat negative publicity& even in small cases& can
ave a devastating impact on te bottom line. -is negative impact can be eliminated or reduced by a proactive
fraud prevention program.
______________________________________________________________________________
I3. Punishment88888888888888888888888888888888888888888888888888888
106. %en a criminal is sentenced to imprisonment& te lengt of te term is al"ays left to te 'udge*s discretion.
,. -rue
B. -alse
-ere are a variety of sanctions available to te 'udge and& "en tey are carged "it imposing sentences& te 'ury
as "ell. ,mong oters& tere is pretrial diversion& probation& and incapacitation or incarceration. If te sentence is
imprisonment& it may be made under rules tat dictate a determinate sentence @suc as five yearsA or an
indeterminate sentence @suc as five to ten yearsA. -ere are some offenses "ere te sentence is mandatory&
dictated by a set of guidelines "ic typically allo" for a decrease or increase of te stipulated amount of time to be
served if certain oter circumstances are present @for instance& "eter te offender "as armedA.
108. In te area of criminal 'ustice& ______________ specify te sentence for a criminal for a fi/ed number of years&
usually set by te legislature& to be served upon conviction of a certain offense.
7. 9eterminate sentences
#. Indeterminate sentences
C. Split sentences
4. 2one of te above
, determinate sentence is one of a fi/ed number of years& usually set by te legislature& to be served upon conviction
of a certain offense. In so-called (flat( determinate sentences& te offender must serve te entire time in prison& say
five years for a fraud violation. 9ore often @toug decreasingly so in many 'urisdictionsA te flat sentence can be
reduced& usually by as muc as one-tird& for (good beavior.( -is carrot is considered important by some prison
administrators because it offers a re"ard for conforming to institutional rules beyond te avoidance of punisments
meted out "itin te "alls& suc as solitary confinement.
106. -e ma'ority of prison inmates "ere using drugs at te time of teir offense.
7. !rue
#. $alse
9ore tan four-fifts of prison inmates ave a record of prior criminal offenses. -"o-tirds are incarcerated for
violent beavior& and more tan alf "ere using drugs at te time of teir offense& "it most of te drug use being
on a daily basis. ,frican ,mericans account for nearly alf of te inmates in prisons& "ile 66 percent of all inmates
are bet"een te ages of +8 and 06. .rior to incarceration& te median income of inmates "as lo"er tan Ml0&000 a
year. -oday& te gro"t in prison populations as been particularly pronounced. In l=;8& tere "ere 010 incarcerated
persons in te B.S. per l00&000 population. -at figure rose to 6:0 inmates per l00&000 persons in +001. -e gro"t
largely "as fueled by te imprisonment of drug offenders. ,t te end of Gune l==6& tere "ere l&600&=60 people in
federal and state prisons and local 'ails. -is represents a rise of 6.6 percent over te previous year& toug te rate
of increase is a decline from te average :.; percent annual gro"t during te previous decade. -ere is someting
of a parado/ in te rise in imprisonment since all reports indicate a falling off in te amount of crime since l==+. ,t
te end of +001& tere "ere 1&=6+&++0 people in federal and state prisons and local 'ails. #y September +006& tis
number 'umped 1.= percent to +&16:&=6:.
10:. #aker& a convicted fraud offender& "as found to be a compulsive gambler. #efore trial& e "as put into a
treatment program. If e completes te program successfully& e "ill not be tried for is fraud. -is type of criminal
'ustice sanction is called1
,. >ptional prosecution
______________________________________________________________________________
B. Pretrial diversion
C. 4iverted sentence
4. 2one of te above
%ile not truly a sentence& since it is not te conse)uence of a trial or a plea& pretrial diversion is often used at te
local level for offenders "o seem suited to "at it as to offer. Bnder its terms& selected individuals& after tey ave
been arrested but before furter proceedings& "ill be placed into some form of treatment program. If it is assumed&
for instance& tat teir troubles "it te criminal la" "ere fundamentally related to alcoolism& tey may be ordered
to attend ,lcoolics ,nonymous meetings a certain number of times eac "eek for a specified period. >ter
offenders& particularly 'uveniles& migt be diverted to different kinds of counseling programs or placed in a remedial
education group. <eferrals to employment services migt also be mandated.
10;. >ver te last t"enty years& prison populations ave generally declined.
,. -rue
B. -alse
-e total number of people in 'ail and prisons in te Bnited States as tripled over te last t"enty years as politicians
ave pressed for touger sentencing la"s and ave built more prisons to seek to assuage public fears about violent
crime.
10=. In te area of criminal 'ustice& ________________is te planned release and community supervision of
incarcerated offenders before te actual e/piration of teir prison sentence.
,. .ardon
#. .robation
C. Community release
9. Parole
.arole @from te $renc& and meaning ("ord( as in ("ord of onor(A is te planned release and community
supervision of offenders before te e/piration of teir sentence. Bnder most state la"s& an offender is eligible for
parole after serving one-tird of is sentence. .arole decisions usually are made by a board or a commission& based
on its members* conclusion regarding "eter te offender "ill remain at liberty "itout violating te la". -ere is
pressure on parole board members to be notably conservative in teir actions& because any repetition of an offense
by someone tey release& particularly if te offense is einous& "ill trigger community outrage against te board. >n
te oter and& overcro"ded prison conditions dictate early release to make room for ne"comers.
160. In te criminal 'ustice system& "ic of te follo"ing sanctions are available to te courtsD
,. .retrial diversion
#. Incapacitation
C. .robation
9. 7ll o" the a,ove are o)tions
______________________________________________________________________________
161. In te area of criminal 'ustice sanctions& probation is fre)uently used for first-time fraud offenders. .robation
usually re)uires certain conditions. %ic of te follo"ing is a typical condition of probationD
,. Steady employment
#. 9eet family responsibilities
C. <estitution of loss
9. 7ll o" the a,ove are ty)ical conditions
.robation implies a contract bet"een te offender and te criminal 'ustice system. 9ost probation rules re)uire tat
te offender adere to some or all of te follo"ing conditions1
E 9aintain steady employment.
E 9ake restitution to te victim for losses or damages.
E Cooperate "it te probation officer. -is involves& among oter matters& so"ing up for appointments& notifying
te officer of cange of address& intention to marry& a ne" 'ob& or similar developments.
E 9eet family responsibilities.
E >bey all la"s. 9any 'urisdictions "ill incarcerate a probationer as a violator if tey believe tat e as committed
anoter offense. -ey revoke is probation status& and tereby avoid te difficulties of a court proceeding. -e
probationer can figt tis disposition& and re)uest a earing& but fe" are likely to do so successfully.
16+. .rison populations nearly doubled bet"een 1=;8 and 1==6 because of a drastic increase in te crime rate.
,. -rue
B. -alse
-oday& te gro"t in prison populations as been particularly pronounced. In l=;8& tere "ere 010 incarcerated
persons in te B.S. per l00&000 population. -at figure rose to 6:0 inmates per l00&000 persons in +001. -e gro"t
largely "as fueled by te imprisonment of drug offenders. ,t te end of Gune l==6& tere "ere l&600&=60 people in
federal and state prisons and local 'ails. -is represents a rise of 6.6 percent over te previous year& toug te rate
of increase is a decline from te average :.; percent annual gro"t during te previous decade. -ere is someting
of a parado/ in te rise in imprisonment since all reports indicate a falling off in te amount of crime since l==+. ,t
te end of +001& tere "ere 1&=6+&++0 people in federal and state prisons and local 'ails. #y September +006& tis
number 'umped 1.= percent to +&16:&=6:.
160. -ere are t"o general types of pardons. -ey are1
,. .olitical and general
B. -ull and a,soluteD and conditional
C. Ieneral and unconditional
4. 2one of te above
, person may apply for a pardon tat& if granted& releases tat person from furter punisment and restores te civil
rigts tat are forfeited upon conviction. -ese rigts include te rigt to vote& serve on a 'ury or old public office.
-ere are t"o types of pardons1 (full and absolute( and (conditional.( $ull and absolute pardons are usually granted
only after conviction and upon so"ing tat te offender "as& in fact& innocent. -e full and absolute pardon
.resident 2i/on received from .resident $ord before impeacment proceedings began "as a rare e/ception to tis
rule. , conditional pardon usually implies guilt and for tis reason may be re'ected by te beneficiary. -e grant of
any pardon or oter clemency is usually a prerogative of te ?/ecutive #ranc and may not be compelled by te
petitioner.
______________________________________________________________________________
166. 9ost ma'or prosecutions for "ite-collar crimes are generated by ____________ agencies.
7. -ederal
#. State
C. 5ocal
4. 2one of te above
9ost ma'or prosecutions for "ite-collar offenses are generated by federal agencies& in part because te ma'ority of
la"s "ic proscribe "ite-collar crime are federal statutes and rules of federal regulatory agencies. ,lso& most state
and local autorities are more tan "illing to yield 'urisdiction to police and prosecutors "o ave larger personnel
pools tat speciali!e in comple/ "ite-collar crime cases.
168. _______________ correctional programs empasi!e te use of neigborood residential centers& alf"ay
ouses& and pre-release centers.
,. .arole
B. Community<,ased
C. .robation
4. 2one of te above
-o ease overcro"ding& community-based correctional facilities ave become commonplace. %ile some persons
migt be sentenced directly to suc programs& tey typically ouse individuals "o ave completed some time
inside institutional "alls. Community-based programs empasi!e te use of neigborood residential centers&
alf"ay ouses& pre-release centers& and furloug programs.
166. In te area of criminal 'ustice sanctions& ______________ is a sentence imposed prior to @and instead ofA
incarceration.
,. .retrial diversion
#. .arole
C. Pro,ation
4. 2one of te above
9any laypersons confuse probation "it parole. .arole refers to te status of an offender after e as been released
from prison or 'ail and is placed under supervision in te community. .robation typically is a sentence imposed
prior to @and instead ofA incarceration. Some 'udges& o"ever& favor "at is called (sock probation.( -ey insist
tat te offender serve a brief time-peraps only a "eek-in a penal institution in order to get a taste of "at can be in
store for tem if tey do not adere to te la" and to te probation conditions tat are imposed upon tem.
______________________________________________________________________________
3. Criminal 4ustice System8888888888888888888888888888888888888888888
16:. In criminology& tere is a direct correlation bet"een age and crime. ,t "at age do arrests for violent crime
peakD
,. +1
B. 1$
C. +8
4. 18
-e most obvious factor tat plays into te amount of crime tat "ill be manifest is te birt rate. -e number of
street crimes rises "en a baby boom generation reaces adolescence& and it declines "en tat generation (ages
out( of te early crime-prone years. .eaks and valleys in te number of people in different age groups "ill cause
corresponding canges in crime rates. ,s ,merica*s population ages& o"ever& it is anticipated tat tere "ill be a
rise in "ite-collar crime because suc offenses most often are committed by older persons "o ave "orked
temselves into positions of po"er and responsibility. %ile youts from l8 to l; make up only about 6 percent of
te ,merican population& tey account for about +8 percent of all arrests for .art I offenses. -e peak age for
property crime is about l6 years& "ile for violent crime te ig point is about l; years.
16;. In te area of criminal 'ustice& a@nA __________ is one in "ic a person is sentenced to a fi/ed number of
years for committing a crime& suc as a five year sentence.
7. 9eterminate sentence
#. Split sentence
C. Indeterminate sentence
4. 2one of te above
16=. ______________ of te suspects arrested for violent crime are "omen.
7. 'ne<tenth
#. >ne-fift
C. >ne-alf
4. 2one of te above
It as been said tat te solution to te crime problem in te Bnited States& indeed& trougout te "orld& is really
)uite simple1 'ust turn males into females& or at least get men to beave as "omen do. %omen account for only one-
)uarter of arrests for property crimes @and tese tend to be te less serious offenses& suc as sopliftingA and but one-
tent of te arrests for violent crime. It as been maintained tat as te feminist movement breaces te "alls of
patriarcy& te female crime rate "ould begin to appro/imate tat of males& but tis as not appened& at least not to
date. -ere as been& o"ever& some increase in te number of arrests of "omen for fraud as greater numbers of
females move into te "orkplace.
______________________________________________________________________________
180. >ne of te biggest differences bet"een te police function in te Bnited States and ?urope is tat in te Bnited
States1
7. Police o)erate ;ith local autonomy
#. .olice operate on a national basis
C. .olice are muc less educated
4. .olice are muc better educated
5a" enforcement in te Bnited States differs in important regards from tat in countries suc as $rance and Ireat
#ritain. 9ost notably& ?uropean forces tend to be national& so tat coordination amongst tem is likely to be better
tan in ,merica. -ere also is less likeliood of corruption. In #ritain& for instance& officers generally are recruited
from places oter tan "ere tey "ill "ork& so tat tey "ill not bring to te 'ob prior personal relationsips tat
may inder teir effectiveness. In te Bnited States& tere as been a constant parade of corruption scandals tat
involve te police in te country*s larger cities& often in connection "it vice operations& matters suc as numbers
gambling& prostitution& and narcotics.
181. ,ll information tat influences a decision-maker in reacing decisions is kno"n as1
,. 4ata
#. Information
C. 5vidence
4. 2one of te above
?vidence can be defined as all te information tat influences a decision-maker in reacing decisions. -is evidence
may take te form of a report& a set of recommendations& or similar items. ?vidence may be )uantitative or
)ualitative7 it may be ob'ective or it may ave sub'ective )ualities7 it may be absolutely compelling to a decision or
it may only be mildly persuasive.
18+. -e information contained in te Bniform Crime <eports is taken from1
7. Police de)artments
#. .ublic surveys
C. Court filings
4. ,ll of te above
-e $ederal #ureau of Investigation @$#IA compiles statistics on te e/tent of crime in te Bnited States in a
document called te Bniform Crime <eport @BC<A. -e report is put togeter on te basis of information voluntarily
submitted by more tan l8&000 la" enforcement departments. -is includes virtually every significant public
policing agency in te country.
180. -e Bniform Crime <eports divide crimes into .art I and .art II offenses. ,ll of te follo"ing are .art I
offenses ?HC?.-1
,. 5arceny
#. ,ggravated assault
C. 9urder
______________________________________________________________________________
9. -orgery
-e BC< divides crimes into .art I and .art II offenses. .art I offenses are murder and non-negligent manslaugter&
forcible rape& robbery& aggravated assault& burglary& larceny& arson& and auto teft. %ile most persons "ould agree
tat tese categories appear to incorporate most serious criminal beavior& te some"at arbitrary nature of te
categories sould not be overlooked.
186. ,mong countries "it eavy urbani!ation& advanced tecnological development& and a relatively ig standard
of living& te Bnited States as a very lo" crime rate.
,. -rue
B. -alse
-"o facts dominate any revie" of ,merican crime statistics1
E -e Bnited States demonstrates a strikingly ig rate of crime compared to oter countries "ic sare most of
its caracteristics& tat is& eavy urbani!ation& advanced tecnological development& and a relatively ig standard of
living.
E %ile ,merican crime rates remain ig in terms of international comparisons& tere as been a dramatic
decrease in te B.S. crime rate during te past si/ years.
188. -e Bniform Crime <eports are compiled and issued by te $ederal #ureau of Investigation.
7. !rue
#. $alse
-e $ederal #ureau of Investigation @$#IA compiles statistics on te e/tent of crime in te Bnited States in a
document called te Bniform Crime <eport @BC<A. -e report is put togeter on te basis of information voluntarily
submitted by more tan l8&000 la" enforcement departments. -is includes virtually every significant public
policing agency in te country.
186. #aker& a C$?& "as involved in te investigation of a criminal fraud case "ere te suspect "as not permitted to
plea bargain. In "ic state is plea bargaining not allo"edD
,. 9aine
B. 7las@a
C. 2ort 4akota
4. 9ontana
In te plea bargain process& te defendant*s attorney "orks out a deal "it te prosecutor. Ienerally te carge is
reduced in e/cange for a guilty plea. .lea bargaining is endemic in ,merican criminal 'ustice& altoug it is not
allo"ed in ,laska& "ere a state-operated court system and a relatively small number of cases permit te system to
function "itout it.
18:. Since te beginning of te feminist movement& te female crime rate as begun to appro/imate tat of males.
,. -rue
B. -alse
%omen account for only one-)uarter of arrests for property crimes @and tese tend to be te less serious offenses&
suc as sopliftingA and but one-tent of te arrests for violent crime. It as been maintained tat as te feminist
movement breaces te "alls of patriarcy& te female crime rate "ould begin to appro/imate tat of males& but tis
______________________________________________________________________________
as not appened& at least not to date. -ere as been& o"ever& some increase in te number of arrests of "omen for
fraud as greater numbers of females move into te "orkplace.
18;. ,bout o" many la" enforcement agencies e/ist in te Bnited StatesD
,. 80&000
B. 2*D***
C. 8&000
4. 2one of te above
-ere are appro/imately +0&000 la" enforcement agencies in te Bnited States. -e ma'ority-about 10&600-are
municipal police departments. 5ocal 'urisdictions also maintain more tan l&000 special police units& including park
rangers& arbor police& transit police& and campus security forces. ,t te county level& tere are some 0&000 seriff*s
departments. In addition& almost every state maintains eiter a state police force or a ig"ay patrol unit. ,ltogeter&
tere are nearly one million persons employed in la" enforcement-bet"een 800&000 and :00&000 s"orn officers or
uniformed personnel and l80&000 civilian employees.
18=. %ic of te follo"ing surveys involve intervie"s of crime victimsD
7. Cational Crime Survey
#. 2ational 3ictim Survey
C. Bniform Crime <eports
4. ,ll of te above
-e 2ational Crime Survey @2CSA is a statistical study carried out by te #ureau of te Census tat annually
conducts intervie"s "it 106&000 individuals in 60&000 ouseolds about e/periences of crime victimi!ation. It
so"s te Bniform Crime <eports @BC<A seriously underreporting7 tat is& te persons intervie"ed report a muc
greater amount of crime tan tat "ic figures in te BC<.
160. Studies indicate tat in as many as alf of te omicides in te Bnited States one or bot parties ad been using
"ic drug rigt before te time of te killingD
,. 9ari'uana
#. Ceroin
C. 7lcohol
4. Cocaine
Criminals may use eroin& cocaine& mari'uana& metampetamine @speedA& among oter drugs& to obtain pleasure or
rela/ation. -ese drugs typically reduce inibitions and& for tose tat are e/pensive& tey create a need to obtain
money for teir purcase.
,lcool& anoter drug& toug a legal one& also is closely tied to criminal beavior& particularly crimes of violence.
Studies indicate tat in as many as alf of te omicides in te Bnited States one or bot parties ad been drinking
eavily rigt before te time of te killing.
161. %ic of te follo"ing is 2>- classified by te Bniform Crime <eports as a .art I offense @ma'or crimeAD
7. -raud
______________________________________________________________________________
#. <obbery
C. #urglary
4. ,rson
-e BC< focuses on eigt offenses @.art IA& "ic it defines as ma'or crimes& and uses tem to calculate (inde/
rates( of serious la"breaking. -e eigt inde/ crimes are1 murder& robbery& rape& aggravated assault& burglary&
larceny& automobile teft& and arson. $raud is not inde/ed by itself& altoug it is commonly included in larceny
prosecutions.
16+. %ic of te follo"ing does 2>- appear on te Bniform Crime <eports .art I inde/ of serious crimesD
7. Eidna))ing
#. ,ggravated assault
C. ,rson
4. <obbery
forcible rape& robbery& aggravated assault& burglary& larceny& arson& and auto teft.
160. %ic of te follo"ing is a .art I inde/ crimeD
,. #urglary
#. <obbery
C. ,utomobile teft
9. 7ll o" the a,ove are inde6 crimes
forcible rape& robbery& aggravated assault& burglary& larceny& arson& and auto teft.
166. In crime trends in te Bnited States& one factor is considered by most criminologists to be te most significant.
It is1
,. ?conomics
B. Birth rate
C. Se/
4. <ace
-e most obvious factor tat plays into te amount of crime tat "ill be manifest is te birt rate. -e number of
street crimes rises "en a baby boom generation reaces adolescence& and it declines "en tat generation (ages
out( of te early crime-prone years. .eaks and valleys in te number of people in different age groups "ill cause
corresponding canges in crime rates. ,s ,merica*s population ages& o"ever& it is anticipated tat tere "ill be a
rise in "ite-collar crime because suc offenses most often are committed by older persons "o ave "orked
temselves into positions of po"er and responsibility. %ile youts from l8 to l; make up only about 6 percent of
te ,merican population& tey account for about +8 percent of all arrests for .art I offenses. -e peak age for
property crime is about l6 years& "ile for violent crime te ig point is about l; years.
______________________________________________________________________________
168. In te area of street crime& a great deal of te offenses are committed by a small core of career criminals.
%ic of te follo"ing is 2>- one of te generally recogni!ed traits of career criminalsD
,. Bnemployment
#. .rior incarcerations
C. Cocaine use
4. ,ll of te above are recogni!ed traits
<esearcers ave found tat offenders can rougly be divided into t"o ma'or groups1 tose "o occasionally
commit crimes and a muc smaller group made up of cronic offenders. , .iladelpia study determined tat 8+
percent of all street crimes "ere committed by 6 percent of te offenders. -is group accounted for bet"een :0 and
;0 percent of all offenses in te area. Career criminals& te researc suggests& ave te follo"ing caracteristics1
E -ey ave been incarcerated for more tan alf of te t"o-year period preceding teir most recent arrest
E -ey ad a 'uvenile conviction prior to te age of l6
E -ey abused eroin or barbiturates during te t"o-year period prior to teir current arrest& or ad a pattern of suc
use as 'uveniles
E -ey ad eld a 'ob for less tan alf of te t"o-year period preceding teir arrest
166. -ere is no correlation bet"een street crime and te criminal*s socioeconomic condition.
,. -rue
B. -alse
-e greatest amount of street crime is committed by persons in te lo"er socioeconomic strata in society. In t"o
studies-one of active burglars and te second of robbers-<icard %rigt and Scott 4ecker determined tat offenders
typically commit teir crimes "en tey see temselves in immediate need of money& often for drugs and partying&
sometimes for rent and food. -o take a 'ob offers no particular ope of resolving "at for tem as been allo"ed to
become a pressing problem. 9ost of te offenders understand tat tey are likely to get caugt sooner or later& but
tey regard tat prospect resignedly as part of te price tey must pay to get tose tings tat are of immense
importance to tem at te time tey "ant tem.
16:. Cagigi and Sornesen cite numerous studies so"ing tat1 @1A people "it lo" incomes& and @+A
______________________________ vie" police departments negatively.
7. %hites ;ith advanced schooling
#. $ar-rigt conservatives
C. .eople from soutern states
4. 2one of te above
#aram Cagigi and Gon Sorensen cite numerous studies so"ing tat1 @1A people "it lo" incomes& and @+A
"ites "it advanced scooling vie" police departments negatively. -ese t"o types of people go against te
general grain in teir disapproval of police. It*s intriguing& ten& to note tat te people most likely to commit fraud
in te "orkplace are "ite men "it e/ecutive status and advanced college degrees. -is suggests tat te
"illingness to commit fraud-like te "illingness to old up a Fuicky .icky-as a great deal to do "it te
perpetrator*s attitude to"ard te la". Simply put& tose "it te most negative attitudes about la" enforcement are
more likely to commit crimes. @-is may seem a/iomatic& but consider o" useful tis kno"ledge could be in
evaluating and distinguising among several suspects.A
16;. In te Bnited States& people carged "it a crime can make bail under certain conditions. ,bout "at
percentage of criminal defendants 'ump bailD
______________________________________________________________________________
,. 60L-:0L
B. 1*><2*>
C. 60L-80L
4. 2one of te above
, large ma'ority of defendants released on bail return for trial. , study of eigt state 'urisdictions found tat l8L
'umped bail7 in a federal study& tis figure dropped to l0L. -ose "o 'umped bail tended to1
E #e on bail for a longer period of time
E Cave a serious prior record
E #e a drug user
E Cave a poor "ork record
E #e disproportionately young& male& and non"ite
______________________________________________________________________________
3I. 5thics "or -raud 56aminers888888888888888888888888888888888888888
16=. %eel"rigt @1=8=A defined tree key elements of etics. %ic of te follo"ing is 2>- one of temD
7. :egislative ,ac@ground
#. 3alues
C. 4ecision problems
4. ,ll of te above are elements
%eel"rigt defined etics as1 (tat branc of pilosopy "ic is te systematic study of reflective coice& of te
standards of rigt and "rong by "ic it is to be guided& and of te goods to"ard "ic it may ultimately be
directed.(
-is definition contains tree key elements1
1A ?tics involves )uestions re)uiring reflective coice @decision problemsA
+A ?tics involves guides of rigt and "rong @moral principlesA
0A ?tics is concerned "it values @goodsA inerent in etical decisions
1:0. ?tical beavior as been described as beavior "ic produces te greatest ___________.
,. ,derence
#. .ersonal appiness
C. 9oral impact
9. Cone o" the a,ove
-ere are t"o standard ans"ers to "at constitutes etical beavior1 @1A etical beavior is tat "ic produces te
greatest good7 and @+A etical beavior is tat "ic conforms to moral rules and moral principles. -e most difficult
problem situations arise "en t"o or more rules conflict or "en a rule and te criterion of te (greatest good(
conflict.
1:1. >ne of te key elements of etics is a concept called reflective coice.
7. !rue
#. $alse
>ne of te key elements in etics is reflective coice. ?tical problems almost al"ays involve pro'ecting yourself
into a future in "ic you ave to live "it your decisions. .rofessional etics decisions usually turn on tese
)uestions1 (%at "ritten and un"ritten rules govern my beaviorD( and (%at are te possible conse)uences of my
coicesD(
1:+. #lue& a Certified $raud ?/aminer& ad a moral dilemma. -e lo"est level of reference for moral decisions is1
,. .ilosopical principles
#. Individual standards
C. !he la;
4. 2one of te above
______________________________________________________________________________
%en faced "it an etics-related problem& it is tempting and appropriate to begin te analysis of a possible action
by asking1 (Is it legalD( -e la" deals "it actions tat are permitted and proibited. %it all due respect to te la"&
it is neverteless te lo"est level of reference for moral decisions. It appens& for e/ample @toug not fre)uentlyA
tat a la" may permit an action tat is proibited by a profession*s code of etics.
1:0. In te realm of etics& values are te means of analysis and principles are te criteria for good and evil.
,. -rue
B. -alse
-ere is a great difference bet"een values and principles in moral tinking. .rinciples are te means of analysis --
te "ays of tinking about moral problems. In tis regard a teory @principleA in etics is a teory about te nature
and basis of morality and te standards for moral 'udgment& "ic arises out of te moral perple/ities of everyday
life. 3alues& on te oter and& are te criteria for good and evil. -o a certain e/tent& people can e/ercise moral
tinking using a principled approac. In te end& o"ever& values necessarily enter into te process.
1:6. >ne pilosopical principle of etics maintains tat a decision sould be made "itout trying to predict
"eter an action "ill probably cause te greatest balance of good over evil. -is scool of tougt is called te1
,. Btilitarian principle
#. Ienerali!ation principle
C. Im)erative )rinci)le
4. 2one of te above
-e imperative principle directs a decision-maker to act according to te re)uirements of an etical rule. Strict
versions of imperative etics maintain tat a decision sould be made "itout trying to predict "eter an action
"ill probably create te greatest balance of good over evil. ?tics in te imperative sense is a function of moral rules
and principles and does not involve any calculation of te conse)uences. ?/ample1 (5ying is "rong.(
1:8. Bnder te imperative principle of etics& lying cannot be 'ustified.
,. -rue
B. -alse
Bnder te imperative principle of etical pilosopy& te rules of conduct are fairly absolute. -ere are& o"ever&
certain e/ceptions. $or e/ample& it is moral to lie in situations involving self-defense. -o Jant& te reasons to break
is strict moral code include self-defense& e/tortion& or malicious misuse.
1:6. ?tical issues are common for fraud e/aminers. -"o aspects of etics operate in te professional environment.
-ese t"o aspects are1
7. /eneral ethics and )ro"essional ethics
#. Specific etics and general etics
C. .rofessional etics and specific etics
4. 2one of te above
-"o aspects of etics operate in te professional environment -- general etics @te spiritA and professional etics
@te rulesA. 9aut! and Saraf @1=61A ave contributed te follo"ing tougts to te association of general etics and
professional etics1 (-e teory of etics as been a sub'ect of interest to pilosopers since te beginnings of
recorded tougt. #ecause pilosopers are concerned "it te good of all mankind& teir discussions ave been
______________________________________________________________________________
concerned "it "at "e may call general etics rater tan te etics of small groups suc as te members of a
given profession. %e cannot look& terefore& to teir pilosopical teories for direct solutions to our special
problems. 2everteless& teir "ork "it general etics is of primary importance to te development of an
appropriate concept in any special field. ?tical beavior in auditing or in any oter activity is no more tan a
special application of te general notion of etical conduct devised by pilosopers for men generally.(
1::. Bnder te imperative principle of etics& it is morally acceptable to lie in certain circumstances.
7. !rue
#. $alse
Bnder te imperative principle of etical pilosopy& te rules of conduct are fairly absolute. -ere are& o"ever&
certain e/ceptions. $or e/ample& it is moral to lie in situations involving self-defense. -o Jant& te reasons to break
is strict moral code include self-defense& e/tortion& or malicious misuse.
1:;. -is principle maintains tat te ultimate criterion of an etical decision is te balance of good conse)uences
@pleasure and avoidance of painA over evil conse)uences @displeasure and painA produced by an action1
,. -e Ienerali!ation .rinciple
B. !he Utilitarian Princi)le
C. -e Imperative .rinciple
4. 2one of te above
-e Btilitarian .rinciple maintains tat te ultimate criterion of an etical decision is te balance of good
conse)uences @pleasure and avoidance of painA over evil conse)uences @displeasure and painA produced by an action.
-e Imperative .rinciple directs a decision maker to act according to te re)uirements of an etical rule. -e
Ienerali!ation .rinciple states tat (if all relevantly similar persons acting under relevantly similar circumstances
"ere to act in a certain "ay and te conse)uences "ould be undesirable& ten no one ougt to act in tat "ay
"itout reason.(
1:=. 9ost codes of professional etics for organi!ations @including te Code of .rofessional ?tics for te
,ssociation of Certified $raud ?/aminersA ave caracteristics of te imperative teory.
7. !rue
#. $alse
9ost professional codes of etics ave caracteristics of te imperative teory. ,s a general matter& professionals are
e/pected to act in a manner consistent "it teir self-imposed rules. Co"ever& public critics fre)uently )uestion not
only conduct itself but te rules upon "ic it is based. Some critics& for e/ample& argue tat many of te etical
rules by professionals are designed to be self-serving
1;0. -e foremost advocate of te imperative scool of etics "as1
,. %illiam <.<. .arnell
#. 9arcus Singer
C. Gon Stuart 9ill
9. Immanuel Eant
______________________________________________________________________________
-e pilosoper Immanuel Jant @1:+6-1;06A "as peraps te foremost advocate of te imperative scool. Jant "as
un"illing to rely solely upon decision-makers* inclinations and values for decisions in various circumstances. Ce
strongly preferred rules "itout e/ceptions.
1;1. -e generali!ation principle asks "ic of te follo"ing )uestionsD
,. (%at is te best outcome from tis situationD(
B. F%hat ;ould ha))en i" everyone acted in a certain ;ayGF
C. (Co" can my personal needs best be servedD(
4. (%at "ould Gesus doD(
-e generali!ation principle& developed by modern-day pilosoper 9arcus I. Singer& argues tat1 (If all relevantly
similar persons acting under relevantly similar circumstances "ere to act a certain "ay and te conse)uences "ould
be undesirable& ten no one ougt to act in tat "ay "itout a reason.( Stated succinctly& (%at "ould appen if
everyone acted in tat certain "ayD(
1;+. %o is generally credited "it developing te utilitarian principle of eticsD
,. 9arcus I. Singer
#. Immanuel Jant
C. 4onald Cressey
9. 4ohn Stuart ?ill
Gon Stuart 9ill @1;06-1;:0A is kno"n as te apostle of te principle of utilitarianism& originated earlier by Geremy
#entam. -is principle maintains tat te ultimate criterion for an etical decision is te balance of good
conse)uences @pleasure and avoidance of painA over evil conse)uences @displeasure and painA produced by an action.
1;0. -e t"o forms of utilitarian principles of etics are1
,. Bse-utilitarianism and act-utilitarianism
B. 7ct<utilitarianism and rule<utilitarianism
C. <ule-utilitarianism and use-utilitarianism
4. 2one of te above
Btilitarian pilosopy generally advocates balancing te conse)uences of good over evil. In act-utilitarianism& te
center of attention is te individual act as it is affected by te specific circumstances of a situation. -e etical
)uestion is1 (%at effect "ill my doing tis act in tis situation ave on te general balance of good over evilD(
<ule-utilitarianism& on te oter and& empasi!es te centrality of rules for etical beavior& "ile still maintaining
te criteria of te greatest universal good. -e )uestion is not "ic action as te greatest utility& but "ic rule. In
oter "ords& ("at effect "ill everyone*s doing tis kind of act in tis kind of situation ave on te general balance
of good over evilD(
1;6. _________ are te personal and social criteria tat are learned and internali!ed troug a "ide variety of
influences-family& social status& peer groups& national origin& and te like.
,. .rinciples
B. &alues
______________________________________________________________________________
C. ?tics
4. 9orals
3alues are te personal and social criteria tat are learned and internali!ed troug a "ide variety of influences-
family& social status& peer groups& national origin& and te like.
1;8. Gon lost is 'ob and is unemployment benefits "ere e/austed. Ce asked is friend Gudy& a Certified $raud
?/aminer and former co-"orker& to look te oter "ay "ile e stole food from te plant*s commissary. Gudy kne"
te act "ould be illegal& but se "as looking for moral 'ustification to elp. -e etical principle tat "ould most
likely be used to 'ustify tis act "ould be te1
,. Ienerali!ation principle
B. Utilitarian )rinci)le
C. Imperative principle
4. 2one could be used to 'ustify te act
-e utilitarian principle states tat te ultimate criterion for an act is te balance of good conse)uences over evil
ones. -e imperative principle "ould not allo" Gudy to assist& since it believes a decision must be made "itin te
re)uirements of a strict etical rule -- certainly elping someone steal& no matter o" onorable te purpose --
"ould violate tose rules. Bnder te generali!ation principle& (if all relevantly similar persons acting under
relevantly similar circumstances "ould act in a certain "ay and te conse)uences "ould be undesirable& ten no one
ougt to act in tat "ay "itout a reason.( <egardless of Gudy*s good motives& er conduct "ould violate te
Certified $raud ?/aminer*s Code of .rofessional ?tics.
1;6. %ic of te follo"ing is a key element of eticsD
I. ?tics involves )uestions re)uiring reflective coice @decision problemsA
II. ?tics involves guides of rigt and "rong @moral principlesA
III. ?tics is concerned "it values @goodsA inerent in etical decisions
,. II. and III. >nly
#. I. and III. >nly
C. I. and II. >nly
9. I.D II.D and III.
%eel"rigt defined etics as1
(tat branc of pilosopy "ic is te systematic study of reflective coice& of te standards of rigt and "rong by
"ic it is to be guided& and of te goods to"ard "ic it may ultimately be directed.(
-is definition contains tree key elements1
I. ?tics involves )uestions re)uiring reflective coice @decision problemsA
II. ?tics involves guides of rigt and "rong @moral principlesA
III. ?tics is concerned "it values @goodsA inerent in etical decisions
1;:. In etics& te saying (%en in <ome& do as te <omans do( is an e/ample of te concept of1
,. Social valuism
B. ?oral relativism
C. ?tical realism
______________________________________________________________________________
4. 2one of te above
4iscussions about values often leads to (moral relativism&( commonly translated1 (%en in <ome& do as te
<omans do.( 9oral relativism denies te e/istence of absolute values tat ave not canged over time and among
cultures.
1;;. %ic pilosopy@iesA of etics could be summari!ed as (te end 'ustifies te meansD(
,. #ot te utilitarian and generali!ation principles
B. !he utilitarian )rinci)le
C. -e generali!ation principle
4. -e imperative principle
-e utilitarian principle maintains tat te ultimate criterion of an etical decision is te balance of good
conse)uences over evil conse)uences produced by an action. -e empasis of one form of utilitarianism& kno"n as
act-utilitarianism& is on te conse)uences of an action rater tan te logical consistency of follo"ing a rule. In oter
"ords& te end 'ustifies te means.
1;=. -e ____________________ principle asks& (%at "ould appen if everyone acted in tat certain "ayD(
,. Imperative
B. /enerali(ation
C. Btilitarian
4. 2one of te above
-e generali!ation principle& developed by modern-day pilosoper 9arcus I. Singer& argues tat1 (If all relevantly
similar persons acting under relevantly similar circumstances "ere to act a certain "ay and te conse)uences "ould
be undesirable& ten no one ougt to act in tat "ay "itout a reason.( Stated succinctly& (%at "ould appen if
everyone acted in tat certain "ayD(
1=0. Bnder te generali!ation teory of etics& if arbitrary times& places& or measures can be inserted into te
decision-making process in suc a "ay as to make te decision nonsense& tis is called1
,. Invertibility
B. +eitera,ility
C. 3eribility
4. 2one of te above
-e generali!ation argument is reiterable "en arbitrary times& places& or measures can be inserted into te etical
decision in suc a "ay as to make a decision to be nonsense. 9arcus Singer& "o developed te generali!ation
teory& illustrated reiterability "it tis e/ample1 (If everyone ate at si/ o*clock tere "ould be no one to perform
certain essential functions ... "it te net result tat no one "ould be able to eat at si/ o*clock or any oter time& and
"it various oter undesirable conse)uences.(
1=1. %en confronted "it undeniable evidence of is fraud& #ob says& (9y son "as sick and I took te money to
pay for is medical care. I did "at I ad to do& and I "ould do it again if I needed to.( #ob*s attitude to"ard is
"rongdoing is an e/ample of "ic of te follo"ingD
,. -e imperative principle
______________________________________________________________________________
#. #ot te utilitarian and generali!ation principles
C. !he utilitarian )rinci)le
4. -e generali!ation principle
-e utilitarian principle maintains tat te ultimate criterion of an etical decision is te balance of good
conse)uences over evil conse)uences produced by an action. -e empasis of one form of utilitarianism& kno"n as
act-utilitarianism& is on te conse)uences of an action rater tan te logical consistency of follo"ing a rule. In oter
"ords& te end 'ustifies te means.
1=+. %en te coice of alternative actions affects te "ell-being of oters& eiter individually or collectively& and
te rigt coice is not absolutely clear& tis is called a@nA1
,. 9oral dilemma
B. 5thical )ro,lem situation
C. .roblem situation
4. 2one of te above
, problem situation e/ists "en you must make a coice among alternative actions and te rigt coice is not
absolutely clear. ,n etical problem situation is a problem situation in "ic te coice of alternative actions affects
te "ell-being of oter people& "eter individually or collectively.
1=0. -e generali!ation principle of etics "as developed by1
7. ?arcus /. Singer
#. %illiam <.<. .arnell
C. Gon Stuart 9ill
4. Immanuel Jant
9arcus I. Singer is a modern pilosoper. Cis (Ienerali!ation in ?tics( dealt "it te basic problems of moral
pilosopy. -"o main components of is argument are1 @1A if all relevantly similar individuals acting under
relevantly similar circumstances "ere to act in a certain "ay and te conse)uences "ould be undesirable& ten no
one ougt to act tat "ay "itout a reason& and @+A "at is rigt for one person must be rigt for any relevantly
similar person in te relevantly same or similar circumstances. -ese features are tougt to provide te needed
fle/ibility to consider te many variations tat arise from real problem situations. It is critici!ed& not surprisingly& for
being too vague and ard to interpret.
1=6. 9ost codes of professional etics for organi!ations @including te Code of .rofessional ?tics for te
,ssociation of Certified $raud ?/aminersA ave caracteristics of te _____________ teory.
,. Btilitarian
B. Im)erative
C. Ienerali!ation
4. 2one of te above
9ost professional codes of etics ave caracteristics of te imperative teory. ,s a general matter& professionals are
e/pected to act in a manner consistent "it teir self-imposed rules. Co"ever& public critics fre)uently )uestion not
______________________________________________________________________________
only conduct itself but te rules upon "ic it is based. Some critics& for e/ample& argue tat many of te etical
rules by professionals are designed to be self-serving.
1=8. -e tree main e/planations for moral principles ave "itstood time& scrutiny& criticism& and scolarly
commentary. %ic of te follo"ing is 2>- one of te tree main e/planations for moral principlesD
,. -e imperative principle
B. !he categorical )rinci)le
C. -e utilitarian principle
4. -e generali!ation principle
-e tree principle vie"s of moral pilosopy "ic ave "itstood time& scrutiny& criticism& and scolarly
commentary include te imperative principle @Immanuel JantA& te utilitarian principle @Gon Stuart 9illA& and te
generali!ation principle @9arcus I. SingerA.
1=6. -e generali!ation argument is ________________ "en @aA bot doing someting and not doing someting
"ould be undesirable& and @bA "en bot everyone and not everyone doing someting "ould be undesirable.
,. <eiterable
B. Inverti,le
C. Conflictable
4. 2one of te above
Bnder te generali!ation principle& it asks te )uestion& (%at "ould appen if everyone acted in tat certain "ayD(
-e generali!ation argument is invertible "en1 @aA bot doing someting and not doing someting "ould be
undesirable& and @bA "en bot everyone and not everyone doing someting "ould be undesirable. $or e/ample& if
everyone in te "orld "ere to become a fraud e/aminer& it "ould be undesirable1 -ere "ould be no food. If no one
became a fraud e/aminer& tat "ould be undesirable too& since tere "ould be no one to elp control fraud. -is
dicotomy creates te principle of invertibility.
1=:. .rofessional organi!ations including te ,ssociation of Certified $raud ?/aminers& ave codes of etics
because1
,. -ey assist in enforcing standards of conduct
#. -ey assist in disciplining members
C. 4irect solutions to professional etical dilemmas may not e/ist under general etical principles
9. 7ll o" the a,ove
%y does an individual or a group need a code of etical conductD %ile it as been said tat a person sould be
uprigt and not be kept uprigt& a code serves a useful purpose as a reference and a bencmark. , code makes
e/plicit some of te criteria for conduct peculiar of a profession& and in tis "ay codes of professional etics are able
to provide some direct solutions tat migt not be available from general etics teories. $urtermore& an individual
is better able to kno" "at te profession e/pects. $rom te vie"point of an organi!ed profession& a code is a public
declaration of principled conduct& and it is a means of facilitating enforcement of standards of conduct. .ractical
enforcement and profession-"ide internal discipline "ould be muc more difficult if members "ere not first put on
notice of te standards.
______________________________________________________________________________
3II. 7C-5 Code o" 5thics88888888888888888888888888888888888888888888
1=;. 9ateriality in a C$?*s report is determined by te perceptions and conclusions of te report*s user.
7. !rue
#. $alse
?vidence and conclusions are material if kno"ledge of tem "ould affect a client*s decisions based on a C$?*s
report. 9ateriality is a user-oriented concept. If matters omitted from te report "ere kno"n to te users& and teir
o"n perceptions and conclusions "ould be different in ligt of tis kno"ledge& te omitted information is material.
C$?s are placed in te difficult position of determining not "at tey consider important and material& but "at tey
tink te users "ill consider important and material.
1==. 4uring te course of a fraud e/amination& %ite& an employee of te ,#C Corp.& approaces #lue& a Certified
$raud ?/aminer& and tells #lue tat e "ises to furnis information in confidence. #lue also is employed by te
,#C Corp. -e Certified $raud ?/aminer sould1
7. Cot agree to the reHuest "or con"identiality
#. ,gree to te re)uest for confidentiality
C. -ell %ite tat te information "ill be eld in confidence& even toug %ite kno"s it "ill not be
4. 2one of te above
$raud e/aminers must remember tat te confidentiality relationsip runs first to te client or employer& and te
promise of confidentiality is understood to e/ist "itout being spoken. In te case of te employee/informant& te
Certified $raud ?/aminer does not ave an understood or unspoken promise of confidentiality. -e Certified $raud
?/aminer sould tell %ite tat e "ill try to keep te information as confidential as possible& but it "ould be
unetical for #lue to promise confidentiality to te employee7 is first obligation is to te employer.
+00. , C$? generally "ould not be able to accept an assignment to uncover fraud in a company in "ic e or se
as a ma'or interest.
,. -rue
B. -alse
, Certified $raud ?/aminer does not ave te same responsibilities as a Certified .ublic ,ccountant. , C.,
generally "ould not be able to e/press an audit opinion on a company in "ic e or se eld a ma'or financial
interest. In te case of tis Certified $raud ?/aminer& e "ould be able to accept suc an assignment under most
conditions& since te goal of te Certified $raud ?/aminer is to gater facts regarding a potential fraud& not e/press
an opinion. -e e/aminer sould& o"ever& make appropriate disclosures regarding is o"nersip. ,rticle II of te
Certified $raud ?/aminer Code of .rofessional ?tics states1 (, C$? sall not engage in any illegal or unetical
conduct& or any activity "ic "ould constitute a conflict of interest.(
+01. , Certified $raud ?/aminer accepts an assignment to conduct a fraud e/amination of te cas function of a
business. #ecause te Certified $raud ?/aminer "as in a urry to complete te 'ob& se overlooked key items of
evidence and failed to uncover a ma'or fraud. -is e/aminer may ave violated te Certified $raud ?/aminer Code
of ?tics.
7. !rue
#. $alse
______________________________________________________________________________
-is action "ould be in violation of ,rticle I of te Certified $raud ?/aminer Code of .rofessional ?tics. -is
article states tat1 (, C$? sall at all times demonstrate a commitment to professionalism and diligence in te
performance of is or er duties.(
+0+. -e Certified $raud ?/aminer Code of .rofessional ?tics does not presume a privileged status for information
provided by a client.
7. !rue
#. $alse
(.rivileged information( is information tat cannot be demanded& even by a court. Common-la" privileges e/ist for
usband-"ife and attorney-client relationsips& and pysician-patient and priest-penitent relationsips ave obtained
te privilege troug state statutes. In all te recogni!ed privileged relationsips& te professional person is obligated
to observe te privilege& "ic can be "aived only by te client& patient& or penitent. 5ike"ise& te Certified $raud
?/aminer*s client or employer is te older of te confidence. Certified $raud ?/aminers& like C.,s and similar
professionals& do not ave protected privileges in common-la" or statute.
+00. Gones& a Certified $raud ?/aminer& obtained a confession from Smit& "o committed internal fraud. Gones is
permitted to e/press an oral but not "ritten opinion on te guilt of Smit.
,. -rue
B. -alse
-e Certified $raud ?/aminer Code of .rofessional ?tics does not distinguis bet"een "ritten or oral opinions.
Certified $raud ?/aminers are absolutely proibited from e/pressing opinions regarding guilt or innocence. ,rticle
3 of te Certified $raud ?/aminer Code of .rofessional ?tics states1 (, C$? in conducting e/aminations& "ill
obtain evidence or oter documentation to establis a reasonable basis for any opinion rendered. 2o opinion sall be
e/pressed regarding te guilt or innocence of any person or party.(
+06. #lake& a Certified $raud ?/aminer& accepted a complicated assignment "ic e felt "as beyond te scope of
is professional e/pertise. -e assignment turned out badly& and te client complained to te #oard of <egents of te
,ssociation of Certified $raud ?/aminers "o referred te matter to teir #oard of <evie". #lake probably violated
te Certified $raud ?/aminer Code of .rofessional ?tics.
7. !rue
#. $alse
#lake migt ave violated ,rticle III of te Certified $raud ?/aminer Code of .rofessional ?tics. -is article
states1 (, C$? sall& at all time& e/ibit te igest level of integrity in te performance of all professional
assignments& and "ill accept only assignments for "ic tere is a reasonable e/pectation tat te assignment "ill
be completed "it professional competence.(
+08. -ere are five principal caracteristics "ic distinguis professional fields from oter vocations. %ic of te
follo"ing is 2>- one of temD
,. , speciali!ed body of kno"ledge
#. Standards of conduct governing professional relationsip
C. 7ll mem,ers must have earned advanced degrees
4. <ecognition and acceptance by society
-e five principal caracteristics tat differentiate professional fields of endeavor from oter vocations are1 @1A a
body of speciali!ed kno"ledge ac)uired troug formal education7 @+A admission to te profession governed by
______________________________________________________________________________
standards of professional )ualifications7 @0A a concomitant pair1 recognition and acceptance by society of
professional status& and concurrent recognition and acceptance of social responsibility by te professional7 @6A
standards of conduct governing relationsips of te professional "it clients& colleagues& and te public7 and @8A a
national organi!ation devoted to te advancement of te social obligations of te professional group.
+06. , profession suc as fraud e/amination must ave a body of kno"ledge uni)ue to itself.
,. -rue
B. -alse
, fraud e/aminer*s "ork involves speciali!ed kno"ledge derived from several oter fields -- accounting& auditing&
criminology& investigation& and la" -- to name a fe". , profession may not ave a body of kno"ledge truly uni)ue
unto itself& but it sould ave one tat re)uires study& compreension& and practice over and above te everyday
abilities every oter person may possess.
+0:. Sue& a Certified $raud ?/aminer& is ired by a client to conduct a fraud e/amination. Se found noting amiss.
, year later& se "as subpoenaed by te local district attorney*s office to provide te client*s file. Bnder te Certified
$raud ?/aminer Code of .rofessional ?tics& se "ill not be able to respond to te subpoena.
,. -rue
B. -alse
-"o articles cover te action by Sue. ,rticle I3 of te Certified $raud ?/aminer Code of .rofessional ?tics states1
(, C$? "ill comply "it la"ful orders of te courts& and "ill testify to matters trutfully and "itout bias or
pre'udice.( ,rticle 3I says1 (, C$? sall not reveal any confidential information obtained during an engagement
"itout proper autori!ation.( In tis particular situation& te Certified $raud ?/aminer must comply under ,rticle
I3& even toug ,rticle 3I seems to be at odds. -e latter states (... "itout proper autori!ation.( It does not state
tat te autori!ation as to come from te client. , subpoena is proper autori!ation under te Code of .rofessional
?tics.
+0;. #lack& a Certified $raud ?/aminer& "as ired to conduct a fraud e/amination. Ce did not find fraud& but in
#lack*s opinion& te controls e e/amined "ere deficient. Bnder te Certified $raud ?/aminer Code of .rofessional
?tics& #lack is not permitted to e/press is opinion on te deficient controls.
,. -rue
B. -alse
,rticle 3 of te Certified $raud ?/aminer Code of .rofessional ?tics states1 (, C$?& in conducting e/aminations&
"ill obtain evidence or oter documentation to establis a reasonable basis for any opinion rendered. 2o opinion
sall be e/pressed regarding te guilt or innocence of any person or party.( >pinions& under ,rticle 3& may be given
if tere is a reasonable basis for it. -e only opinions strictly not allo"ed are tose regarding te guilt or innocence
of any person or party.
+0=. 5ane& a Certified $raud ?/aminer& conducted an e/amination of te #lue Corp. #etty "as a prime suspect in
te disappearance of money& but 5ane could not prove it. 5ater& e discovered #etty ad been recently ired by te
<ed Corp.& anoter client of is. Bnder te Certified $raud ?/aminer Code of .rofessional ?tics& 5ane must1
,. Inform te <ed Corp.
B. Cot in"orm the +ed Cor).
C. Inform te <ed Corp. if te evidence is clear and convincing
4. 2one of te above
______________________________________________________________________________
,rticle 3I says tat1 (, C$? sall not reveal any confidential information obtained during a professional
engagement "itout proper autori!ation.( Bnder tis scenario& te Certified $raud ?/aminer may not disclose te
fact of #etty*s employment at te #lue Corp.& or tat se "as a suspect in te disappearance of money "itout te
autori!ation of te #lue Corp. Co"ever& even if tat autori!ation "as received& te Certified $raud ?/aminer is
limited as to "at can be disclosed. #etty "as a suspect7 se did not confess nor "as se convicted of a crime. If te
Certified $raud ?/aminer does disclose tis information& e or se could run te risk of serious legal problems.
+10. .rofessional competence demands attention to tree forces "ic may damage independence and te )uality of
"ork. %ic of te follo"ing is 2>- one of tese forcesD
7. Predication
#. .rogramming
C. <eporting
4. Investigation
.rofessional competence demands attention to tree forces tat can damage te independence and )uality of te
"ork. -e tree forces are1 programming& investigation& and reporting. $raud e/aminers must remain free from
interference by managers "o try to restrict& specify& or modify te procedures tey need to perform @programmingA.
Certified $raud ?/aminers must ave te cooperation of managers and oters "itout any attempt to control access
to books& records& correspondence& and oter evidence @investigationA. Client or employer managers sould not be
allo"ed to overrule te Certified $raud ?/aminer*s 'udgment on te appropriateness of te content of a report
@reportingA.
+11. If a Certified $raud ?/aminer engaged in an illegal activity not kno"ing at te time tat te activity "as illegal&
,rticle II of te Certified $raud ?/aminer Code of .rofessional ?tics "ill protect te e/aminer& as it states tat (,
C$? may not kno"ingly engage in illegal or unetical conduct.(
,. -rue
B. -alse
Some rules for oter professions insert te "ord (kno"ingly( in relation to illegal activities& saying (>ne sould not
kno"ingly be a party to an illegal activity.( -e Certified $raud ?/aminer Code of .rofessional ?tics does not
include tis "ay out. -e article states1 (, C$? sall not engage in any illegal or unetical conduct ....( Certified
$raud ?/aminers generally are not entitled to claim ignorance of te la". -ey are e/pected to kno" a considerable
amount about te la" in connection "it investigations& and tey are e/pected to kno" "en to consult a la"yer.
+1+. , Certified $raud ?/aminer conducted a fraud e/amination tat resulted in te dismissal of %arren& Cief
$inancial >fficer. 2umerous internal control deficiencies permitted %arren to commit te fraud. #ut since te
e/aminer "as not ired to evaluate controls& e did not mention te internal control deficiencies in is report to
management. ,ccording to te Certified $raud ?/aminer Code of .rofessional ?tics& te C$? kno"s e can only
discuss information e "as ired to investigate.
,. -rue
B. -alse
,rticle 3II of te Certified $raud ?/aminer Code of .rofessional ?tics states1 (, C$? sall reveal all matters
discovered during te course of an e/amination& "ic& if omitted& could cause a distortion of te facts.( ,ltoug
te e/aminer "as not ired to evaluate controls& is or er professional responsibilities "ould re)uire te disclosure
of any information "ic could cause a distortion of te facts.
+10. ,rticle 3 of te Certified $raud ?/aminer Code of .rofessional ?tics proibits Certified $raud ?/aminers
from e/pressing opinions on te guilt or innocence of any person or party. -e reason for tis ,rticle& in part& is to
protect te e/aminer from1
______________________________________________________________________________
,. 4efamation
#. 5ibel
C. Slander
9. 7ll o" the a,ove
4efamation is composed of te torts of libel and slander. -e former are "ritten statements& "ile te latter is
spoken statements. In order to be defamatory& a statement must1 @1A in'ure te person*s reputation& @+A be
communicated orally or in "riting to oters& @0A cause damages& and @6A be untrue. ?/pressing opinions regarding
te guilt or innocence of any person or party runs te risk of defamation if te person is subse)uently not found
guilty of te offense.
+16. , report by a Certified $raud ?/aminer is privileged from discovery by anyone oter tan te client.
,. -rue
B. -alse
(.rivileged information( is information tat cannot be demanded& even by a court. Common-la" privileges e/ist for
usband-"ife and attorney-client relationsips& and pysician-patient and priest-penitent relationsips ave obtained
te privilege troug state statutes. In all te recogni!ed privileged relationsips& te professional person is obligated
to observe te privilege& "ic can be "aived only by te client& patient& or penitent. 5ike"ise& te Certified $raud
?/aminer*s client or employer is te older of te confidence. Certified $raud ?/aminers& like C.,s and similar
professionals& do not ave protected privileges in common-la" or statute.
+18. , Certified $raud ?/aminer "as ired to investigate a company. ,fter e carefully e/amined te company& e
issued a report tat stated& in part& (... in my opinion& tis operation is free of material fraud.( Suc an opinion is
permitted under te Certified $raud ?/aminer Code of .rofessional ?tics.
,. -rue
B. -alse
$raud e/aminers must al"ays perform teir "ork "it skepticism& beginning "it te belief tat someting is "rong
or someone is committing a fraud. -is attitude may make fraud e/aminations e/tensive and e/pensive. >pinions or
attestations of a fraud-free environment are proibited for Certified $raud ?/aminers. -is is for te protection of
te Certified $raud ?/aminer -- "e only kno" for sure tat fraud e/ists "en some event or transgression causes it
to be uncovered.
+16. 9artin conducted a fraud e/amination "ic led to a valid confession of <utledge& an embe!!ler. In 9artin*s
report& e stated tat& in is opinion& (<utledge is guilty of embe!!lement.( 9artin as 'ust violated te Certified
$raud ?/aminer Code of .rofessional ?tics.
7. !rue
#. $alse
-e guilt or innocence of any person or party is te sole 'udgment of te 'ury& and not of te Certified $raud
?/aminer. ,rticle 3 states tat1 (, C$?& in conducting e/aminations& "ill obtain evidence or oter documentation to
establis a reasonable basis for any opinion rendered. 2o opinion sall be e/pressed regarding te guilt or innocence
of any person or party.(
+1:. ,rticle 3 of te Certified $raud ?/aminer Code of .rofessional ?tics states in part tat& (2o opinion sould be
e/pressed regarding te guilt or innocence of any person or party.( 4uring an accusatory intervie" of #lack& a
Certified $raud ?/aminer accused #lack of aving committed a fraud. -is e/aminer is in violation of ,rticle 3.
______________________________________________________________________________
,. -rue
B. -alse
,rticle 3 of te Certified $raud ?/aminer Code of .rofessional ?tics states1 (, C$?& in conducting e/amination&
"ill obtain evidence or oter documentation to establis a reasonable basis for any opinion rendered. 2o opinion
sall be e/pressed regarding te guilt or innocence of any person or party.( ,ltoug it does not specifically state
suc& te above ,rticle really applies to statements made to tird parties. If te Certified $raud ?/aminer "as
intervie"ing a suspect "ose guilt "as igly probable& te Code "ould not proibit te e/aminer from making
accusations. -e admission-seeking process& used e/tensively by Certified $raud ?/aminers& re)uires accusations be
made of te probable guilty party. ,s long as tese accusations are not communicated to tird parties& te Certified
$raud ?/aminer "ould not be in violation of te Code.
+1;. , Certified $raud ?/aminer is re)uired& at a minimum& to maintain te average of +0 ours of continuing
professional education annually. ,t least alf of tat education must relate directly to te detection or deterrence of
fraud. If a Certified $raud ?/aminer fails to do so& e or se "ill be in violation of te Certified $raud ?/aminer
Code of .rofessional ?tics.
7. !rue
#. $alse
,rticle 3III of te Certified $raud ?/aminer Code of .rofessional ?tics states (, C$? sall continually strive to
increase te competence and effectiveness of professional services performed under is or er direction.( If te
Certified $raud ?/aminer fails to maintain te re)uired continuing professional education& e or se is in violation
of ,rticle 3III of te Code.
+1=. Iray& an independent Certified $raud ?/aminer& "as ired by Ireen& president of te ,#C Corporation& to
investigate a routine embe!!lement case. Iray learns during te investigation tat Ireen is involved in an unrelated
fraud. Bnder te Certified $raud ?/aminer Code of .rofessional ?tics& Iray sould1
,. <esign te engagement
#. 2ot disclose te information about Ireen
C. !ell the Board a,out /reen
4. 2one of te above
Certified $raud ?/aminers must be very careful. In tis particular case& te #oard sould probably be advised. In
general& Certified $raud ?/aminers are not obligated to blo" te "istle on clients or employers. Co"ever&
circumstances may e/ist "ere te Certified $raud ?/aminer is morally and legally 'ustified in making disclosures
to appropriate outside parties. Suc circumstances include1 @1A "en a client or employer as intentionally involved
a Certified $raud ?/aminer in its illegal conduct& or @+A "ere a client or employer as distributed misleading
reports based on te Certified $raud ?/aminer*s "ork. ,ltoug te e/aminer could teoretically resign& suc action
"ould be tantamount to allo"ing te conspiracy or fraud to continue "itout anyone*s being a"are of te fraud.
Certified $raud ?/aminers "ould not be able to 'ustify doing noting.
++0. Co" many years of professional e/perience are re)uired in order to be a"arded te Certified $raud ?/aminer
designationD
,. >ne
#. $our
C. !;o
______________________________________________________________________________
4. -ree
>ne can sit for te Certified $raud ?/aminer e/amination te last semester in college. Co"ever& to be a"arded te
designation& one must ave a minimum of t"o years e/perience in a field related to fraud detection or deterrence
before being certified.
++1. Co" many sections are tere to te Certified $raud ?/aminer Code of .rofessional ?ticsD
7. 5ight
#. -en
C. 2ine
4. 2one of te above
-ere are eigt sections to te Certified $raud ?/aminer Code of .rofessional ?tics. -ey are summari!ed as
follo"s1
E I. Commitment to professionalism
E II. Illegal or unetical conduct
E III. .rofessional competence of assignments
E I3. 5a"ful orders of te courts
E 3. #asis for opinions
E 3I. Confidential information
E 3II. <eveal material matters
E 3III. Increase professional competence
+++. Certified $raud ?/aminers are permitted to (double count( some continuing professional education ours
earned "it certain oter designations& suc as C.,.
7. !rue
#. $alse
.eople "o become Certified $raud ?/aminers must accrue +0 ours of continuing professional education annually.
Certified $raud ?/aminers are permitted to (double count( continuing education received from oter certifications
as long as tey also meet te criteria for fraud e/amination continuing education. ,t least alf of te ours earned&
o"ever& must relate directly to te detection or deterrence of fraud.
++0. Certified $raud ?/aminers are re)uired under te Code of .rofessional ?tics to maintain continuing
professional education. >n an annual basis& Certified $raud ?/aminers are re)uired to obtain an average of o"
many ours of continuing professional educationD
7. 2* hours
#. 60 ours
C. 00 ours
4. 2one of te above
Continuing professional education is re)uired of a Certified $raud ?/aminer under ,rticle I of te Code "ic
states1 (, C$? sall continually strive to increase te competence and effectiveness of professional services
performed under is or er direction.( Certified $raud ?/aminers currently are re)uired to ave +0 ours of
continuing professional education annually. Calf of tis amount must relate directly to te detection or deterrence of
fraud.
______________________________________________________________________________
++6. ,ll certification programs must be licensed by te state.
,. -rue
B. -alse
Certification programs may or may not be regulated by state statute. Some& like C.,s& doctors& and la"yers& are
regulated. >ters& like te Certified $raud ?/aminer and Certified Internal ,uditor& are self-regulating.
______________________________________________________________________________

Criminology Questions

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Criminology Questions

Uploaded by

Copyright:

Available Formats

Sec.

You might also like