Physical tampering prevention is a check tampering technique that is used to secure bankassisted controls.

The statement is incorrect because it confuses a fraud prevention measure with a fraud technique. Physical tampering prevention refers to security features and controls designed to stop or deter check tampering. In contrast, a check tampering technique is a method used by a fraudster to commit the crime. Therefore, physical tampering prevention is a control, not a fraud scheme. Check tampering schemes include methods such as forged maker schemes, forged endorsement schemes, and altered payee schemes. Physical tampering prevention measures, such as using chemically sensitive paper, watermarks, or security threads on check stock, are implemented to thwart these very techniques.

The option "True" is incorrect because it fundamentally mischaracterizes the relationship between a control and a fraud scheme. A control (physical tampering prevention) is designed to counteract a scheme (check tampering); it is not a type of scheme itself.

1. Association of Certified Fraud Examiners (ACFE). (2023). Fraud Examiners Manual, International Edition.

Section 2: Financial Transaction and Fraud Schemes, Subsection: Asset Misappropriation, Chapter: Check Tampering. This chapter details the five principal categories of check tampering schemes: forged maker, forged endorsement, altered payee, concealed check, and authorized maker schemes. It clearly defines these as the methods of perpetrating fraud.

Section 2: Financial Transaction and Fraud Schemes, Subsection: Asset Misappropriation, Chapter: Check Tampering, Part: Preventing and Detecting Check Tampering. This part describes controls to combat check fraud. It lists physical safeguards for check stock, such as storing them in a locked location and using high-security checks with features like watermarks and security threads, which are forms of physical tampering prevention. This explicitly separates prevention methods from fraud techniques.

2. Wells, J. T. (2017). Corporate Fraud Handbook: Prevention and Detection (5th ed.). John Wiley & Sons.

Chapter 5: Check Tampering. This chapter outlines the various methods fraudsters use to tamper with checks. It then discusses countermeasures in a separate section, stating, "To prevent check fraud, an organization must enact physical controls over its check stock... Organizations should consider using high-security checks that are difficult to forge or alter. Features such as watermarks, security threads, and chemically sensitive paper can help deter would-be forgers" (p. 138). This source clearly distinguishes the fraudulent techniques from the preventive controls.

3. Albrecht, W. S., Albrecht, C. O., Albrecht, C. C., & Zimbelman, M. F. (2019). Fraud Examination (6th ed.). Cengage Learning.

Chapter 8: Cash Larceny and Skimming. While discussing cash misappropriation, the text emphasizes control activities. In the context of preventing check fraud, it discusses the importance of physical controls over blank checks and the use of checks with security features. These are presented as preventative measures, distinct from the fraudulent acts they are designed to stop. The text categorizes fraud schemes separately from the internal control framework (prevention, detection, and response) used to combat them.