123k views
4 votes
Which of the following is NOT an indicator of a possible bust out?

a) an address that is a post office box
b) new ownership of a company
c) slow buildup of inventory
d)dramatic increase in the size of credit orders

User Kenji
by
8.2k points

1 Answer

3 votes

Final answer:

The indicator that is not associated with a bust out is a slow buildup of inventory. Bust out fraud usually involves a business artificially establishing a good credit history and then exploiting large credit lines, not normal inventory management activities.

Step-by-step explanation:

The indicator that is NOT a sign of a possible bust out scheme is c) slow buildup of inventory. A bust out is a type of fraud where a company appears legitimate but is created with the intention of establishing a good credit history with the intent to max out extended credit lines and disappear. An address that is a post office box (a), new ownership of a company (b), and a dramatic increase in the size of credit orders (d) are all potential indicators of a bust out. These signs suggest that the company may be artificially building a good credit history or trying to obtain large credit lines before committing fraud. In contrast, a slow buildup of inventory could be just a normal business activity, as companies often accumulate inventory to meet future demands.

User Bhaumik
by
9.2k points
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

9.4m questions

12.2m answers

Categories