Final answer:
The statement is false; fraud in the AP/CD process does not typically involve creating phony customers or fictitious purchase orders, but rather concerns unauthorized payments or embezzlement, whereas identity theft involves stealing and misusing personal identification and financial information.
Step-by-step explanation:
The statement that fraud abuses in the AP/CD process usually entail creating phony customers or submitting fictitious purchase orders is false. AP/CD typically refers to 'Accounts Payable/Cash Disbursements,' which is a process within businesses related to managing outgoing payments. Fraud in this area might involve issuing unauthorized checks, fake billing schemes, or embezzlement.
However, the activity described in the question more closely relates to identity theft, particularly 'True-name Fraud.' This type of fraud involves wrongfully acquiring and using a consumer's personal identification, credit, or account information without permission. The theft can lead to emptied savings accounts and large credit card debts as the thieves make expensive purchases, such as automobiles, boats, trips, and jewelry. These actions are separate from, but can interact with, fraud within the AP/CD process.