Academic journal article Journal of Accountancy

What's Your Fraud IQ?

Academic journal article Journal of Accountancy

What's Your Fraud IQ?

Article excerpt


The inherent and evolving risks in the banking environment--especially concerning online transactions--command that account holders keep abreast of threats to their accounts, understand their rights and responsibilities as account holders, and take appropriate security measures to protect themselves from fraudulent bank account activity. Are you prepared to help your clients or employer confront these daunting tasks? Take this quiz to find out.

1. A fraudster used a keylogger to steal the logon credentials and challenge-question answers of Sitting Duck Co. He then used this information to initiate fraudulent wire transfers from the company's bank account. In which of the following ways might the company's computer have fallen victim to keylogging?

a. A user of the target computer unwittingly visited an infected website or clicked on an infected banner advertisement.

b. A user of the target computer unwittingly opened an infected email attachment.

c. The fraudster, or an accomplice, plugged a keylogging hardware device into the target computer.

d. All of the above.

2. The Universal Payment Identification Code (UPIC) recently obtained by Some Co. from its bank can be used in which of the following ways?

a. By Some Co. to receive payments via wire transfer from customers without divulging its bank account information.

b. By Some Co. to receive Automated Clearing House (ACH) payments from customers without divulging its bank account information.

c. By Some Co.'s authorized suppliers to initiate direct debits against its bank account without knowing its bank account information.

d. All of the above.

3. Buford, the controller of Bait Taker Co., received an unexpected yet seemingly legitimate email from the company's bank prompting him to renew his security token. Following the renewal instructions m the email, he clicked on an embedded link to log in to the company's online banking site and renew the token. Buford should enter his logon credentials only under which of the following conditions?

a. The web address in his browser matches that of the bank.

b. The term "https" precedes the web address, indicating a secure web session.

c. A secure lock icon appears in the status bar at the bottom of the browser window

d. None of the above.

4. Prudence was fired from Fake Corp. for insubordination. Angry and concerned about making ends meet, she altered her final paycheck, changing the amount to $5,547.30 from $547.30, and cashed it for the inflated amount through a teller at the company's bank. The company's failure to use high-security check stock, along with the teller's inattention to the obvious, visible evidence of alteration, made it easy for Prudence to execute her scheme. Which of the following outcomes regarding liability for the loss under the Uniform Commercial Code (UCC) is most likely given the failure of both Fake Corp. and its bank to exercise ordinary care?

a. The bank is strictly liable for the entire loss.

b. The bank's liability for the loss is limited to $500.

c. The bank will share liability with Fake Corp. for the loss based on comparative fault.

d. Fake Corp.'s liability for the loss is limited to $500.

5. In setting up her online access to Pigeon Inc.'s bank accounts, Petunia, the company's controller, is asked to select several challenge questions as an added layer of security Which of the following is likely to be an effective challenge question?

a. What is your mother's maiden name?

b. From what high school did you graduate?

c. What is your father's middle name?

d. None of the above.

6. On Monday, a thief stole Ishmael's debit card, which was linked to Ishmael's personal checking account. The thief used the cam to purchase $400 worth of electronics and $200 worth of groceries over the next several days. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed


An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.