Question

Kevin Chitry, a sales executive for CIT Manufacturing, frequently took clients out for dinner and shows when they came to town to tour the plant. He usually paid for these expenses himself and submitted the receipts to his supervisor for approval and reimbursement. Occasionally, however, he also took his family out to restaurants and rock concerts and included these expenses in his reimbursement requests by indicating that he was entertaining a client. This type of fraud is known as a(n): a. Overstated expense reimbursement b. Mischaracterized expense reimbursement c. Fictitious expense reimbursement d. Altered receipt reimbursement

Answer 1

The fraudulent activity committed by the sales executive, Kevin Chitry, is classified as a mischaracterized expense reimbursement, which is when personal expenses are deceitfully claimed as business expenses to get reimbursement.

Step-by-step explanation:

The fraud committed by the sales executive, Kevin Chitry, is known as b. Mischaracterized expense reimbursement. This type of fraud involves an employee deliberately misreporting personal expenses as business-related in an attempt to seek reimbursement. For example, Kevin took his family out to restaurants and concerts, which are personal expenses, and then misrepresented them as client entertainment expenses in his reimbursement requests. The expense is real, but its purpose has been mischaracterized to secure an unwarranted reimbursement.

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