Question

Sharon Forsyth worked in a purchasing department for a retail store. She was in charge of ordering merchandise inventory converter supplies for the organization. She purchased merchandise through a fictitious shell company and then resold it to her employer at an inflated price. What is the name of this type of fraud and how can be prevented?(A) Shell company scheme.(B) Pass through scheme.(C) Pay-and-return scheme.(D) Skimming scheme.

Answer 1

Answer: pass through scheme

Explanation: In simple words, it refers to a fraud in which the employee makes a shell company to purchase goods on behalf of the employer then resell it to the employer at higher prices.

In the given case, Sharon Forsyth was in the purchasing department and was purchasing the goods on behalf of employer and then reselling it at an inflated price.

Thus, we can conclude that the correct option is B .