The perpetrators of which frauds produce false documents that cause the victim company to unwittingly make a fraudulent disbursement?

Payroll and expense reimbursement schemes are classic examples of fraudulent disbursements that rely on false documentation. In payroll schemes, perpetrators may create ghost employees, falsify timesheets, or inflate commission records. In expense reimbursement schemes, they submit claims for fictitious expenses, mischaracterized personal costs, or overstated amounts. In both cases, the perpetrator submits falsified documents to the victim organization, which then unwittingly processes and issues a fraudulent payment based on that deceptive information.

A. "Frequency of fraudulent disbursements" is a statistical metric used to measure how often a type of fraud occurs; it is not a category of fraud itself.

C. "Inventory & Purchase reimbursement schemes" is not a standard fraud classification. Inventory fraud typically involves the theft of physical assets, not fraudulent disbursements.

D. "Sales & Equipment reimbursement schemes" is not a recognized category in the fraud tree. While an expense claim could be for equipment, it falls under the broader expense reimbursement category.

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

Section 2, Subsection: Payroll Schemes (p. 2.701): "Payroll schemes are occupational frauds in which a person who works for an organization causes that organization to issue a payment by making false claims for compensation." This section details how ghost employees, falsified hours, and falsified wages rely on creating and submitting false records (e.g., timecards, personnel files).

Section 2, Subsection: Expense Reimbursement Schemes (p. 2.801): "Expense reimbursement schemes are a form of fraudulent disbursement in which employees make false claims for reimbursement of fictitious or inflated business expenses." This section explains that schemes like mischaracterized expenses, overstated expenses, and fictitious expenses require the perpetrator to submit false documentation (e.g., altered receipts, fabricated support).

2. Albrecht, W. S., Albrecht, C. O., Albrecht, C. C., & Zimbelman, M. F. Fraud Examination (5th ed.). 2016. Cengage Learning.

Chapter 7, "Fraudulent Disbursements": This chapter explicitly categorizes payroll and expense reimbursement schemes as types of fraudulent disbursements. It states, "Expense reimbursement frauds are schemes in which an employee makes a claim for reimbursement of fictitious or inflated business expenses... To be reimbursed, the employee must typically submit a document... that supports the claim." (p. 228). Similarly, it describes payroll schemes as involving the manipulation of payroll system records to generate fraudulent payments.