Payment Fraud Flashcards
If a customer reports the loss or theft of an access device, the financial institution should attempt to prevent fraud related to electronic funds transfers (EFTs) by canceling the existing card, personal identification number (PIN), or other form of access and issuing a new one.
A. True
B. False
True
To conduct an electronic payment using a person-to-person (P2P) system, the two individuals must meet in person at a financial institution to sign an order requesting the transfer of money from one person’s account to the other.
A. True
B. False
False
Which of the following is NOT a common type of payment card fraud?
A. Skimming
B. Advance payments
C. Profiling
D. Card counterfeiting
C. Profiling
Which of the following types of transactions is LEAST LIKELY to use a person-to-person (P2P) payment system?
A. A person paying for an item on an online auction site
B. A person buying groceries at a supermarket
C. A person transferring money to a friend abroad
D. A person making an online donation to a charity
B. A person buying groceries at a supermarket
Liam is the manager of a small bank that has recently experienced an increase in the amount of fraud related to electronic funds transfers (EFTs). Which of the following methods can Liam implement to reduce his bank’s exposure to EFT fraud?
A. Send a welcome letter to new customers to determine if the address submitted on the account application is valid
B. Separate the duties of bank employees so that the responsibilities for the issuance of access devices are separate from the issuance of PINs
C. Ensure that PINs are mailed to the customer separately from other associated account information
D. All of the above
D. All of the above
The equipment needed to operate a check fraud ring is very expensive and difficult to obtain.
A. True
B. False
False
In which of the following scenarios might a card skimming or shimming scheme be conducted?
A. A server walks away from a customer’s table to process a card payment
B. A customer is pumping gasoline and notices a strange device attached to the self-payment apparatus
C. An employee processes a payment concealed from the customer’s view
D. All of the above
D. All of the above
Which of the following is NOT a red flag of a fraudulent payment card transaction?
A. A customer insists on taking a large item home even when delivery is included.
B. A customer charges many expensive items to a newly valid card.
C. A customer buys a small number of expensive items at one time.
D. A customer cannot provide a photo identification when requested.
C. A customer buys a small number of expensive items at one time.
Which of the following does NOT constitute an electronic funds transfer (EFT)?
A. The computer-initiated deposit of an employee’s paycheck directly into the employee’s bank account
B. A transfer of funds from a checking account to a savings account performed on a personal computer
C. A customer’s use of a debit card to purchase dinner at a restaurant
D. An airline ticket purchased through the internet with the use of a credit card
D. An airline ticket purchased through the internet with the use of a credit card
Mobile payments that require biometric authentication, such as a partial fingerprint or three-dimensional facial scan, are usually less vulnerable to cyberattacks.
A. True
B. False
True
The chances of being arrested and prosecuted for check fraud are high, and the penalties are relatively severe in most jurisdictions.
A. True
B. False
False
Mario, an employee of a person-to-person (P2P) payment company, has been writing down the account numbers and passwords of customer accounts with the intent of fraudulently using them to pay for items he purchases online. Mario is engaging in:
A. Credit card transfer fraud
B. Check fraud
C. Electronic funds transfer fraud
D. None of the above
C. Electronic funds transfer fraud
Which of the following steps is often taken during an account takeover scheme?
A. Changing customer contact information on the overtaken account
B. Stealing account log-in information by sending phishing emails
C. Placing orders using funds from the overtaken account
D. All of the above
D. All of the above
Due to the paper trail involved and the emphasis placed on the problem by law enforcement, most check fraud offenders are pursued and prosecuted.
A. True
B. False
False
Which of the following is a reason why prepaid debit and gift card fraud schemes are appealing to fraudsters?
A. Prepaid cards are difficult to track after they have been purchased and activated
B. Prepaid cards are relatively anonymous payment methods
C. Prepaid cards can be purchased at countless retailers
D. All of the above
D. All of the above
