CFE – Financial Transactions and Fraud Schemes — Question 60

For a ghost employee scheme to be successful, which of the following must be TRUE?

Answer options

• A. The ghost employee must receive payment via direct deposit.
• B. The ghost employee must be a fictitious person.
• C. Paychecks must be generated to someone who does not actually work for the victim company.
• D. Paychecks must be generated to someone who used to work for the victim company.

Correct answer: D

Explanation

The correct answer is D because a ghost employee scheme often involves issuing paychecks to individuals who were once employed, making it harder to detect fraud. Options A and B are incorrect as they do not capture the essential nature of the scheme, and option C is misleading since it implies that the individual has never worked for the company at all.