January 1994 Fraud Terminology Topics
Mail Cover, Walking Around Money, Virgule,
Cutaway, Weasel Word, CFE, Expert, Upset Price,
Bid Shopping, Corpnership, and Change Audit
 

Conducting a mail cover in December and January
can identify business colleagues, social contacts,
and family members of a suspected fraudster.
 

Fraud In Other Words™
Professional Jargon and Uncensored Street Slang
by Larry C. Adams, CFE, CPA, CIA, CISA

 

Mail Cover
An application for a mail cover may be submitted by law enforcement to the regional chief postal inspector. The application will state that there is reason to believe that the subject has committed a felony, and will include a brief overview of the case. A mail cover is usually authorized for a 30 day period and possibly a 30 day extension. During this period, post office personnel will record the return address, postmark information, and delivery address of mail delivered to the subject. The addressee and the sender are not notified about the mail cover operation. A mail cover is most often effective at the beginning of the year, when financial institutions and businesses send their tax information and 1099 series of forms (such as 1099-INT for interest income, 1099-DIV for dividends, and 1099-MISC for miscellaneous income). A mail cover may provide the names and addresses of financial institutions, credit card companies, real estate brokers, investment brokers, business colleagues, social contacts and family members of the subject.

 

CFE
A Certified Fraud Examiner. A specialist who is responsible for resolving allegations of fraud, taking statements and writing reports, testifying to findings, and assisting in the detection and deterrence of fraud. A professional with expert knowledge in the areas of financial transactions, criminology, ethics, investigations, and legal elements of fraud. The Uniform CFE Examination and the professional accreditation program are administered by the Association of Certified Fraud Examiners in Austin, Texas.

 

Walking Around Money
A slush fund, often used for the purpose of political influence. Money collected or spent for corrupt purposes, such as illegal lobbying or buying votes. A large amount of cash subjected to few, if any, accounting controls.



 

Virgule
A solidus or slash symbol (/) used in notes and reports to replace “and,” “or,” “both,” or “per.” Examples: “and/or,” “feet/second,” “fiscal year 1993/1994.” A virgule may be used to make an expression intentionally or unintentionally ambiguous.

 

Cutaway
An illustration that shows the internal structure of an object that is normally sealed (like an orange sliced in half). A cutaway might be used to depict the locations of phone taps, computer data taps, surveillance electronics, or hidden storage compartments.

 

Weasel Word
A word used to evade or retreat from a direct statement or position. A word used to hedge, such as generally, likely, possibly, likely, appear, seem, believe, usually, and speculation. The phrase was derived from the weasel’s habit of sucking the contents out of an egg while leaving the shell superficially intact. A single inaccurate figure or fact can destroy the credibility of a document and its writer. Weasel words may indicate honest doubt or uncertainty. Every detail in a document should be as accurate as the writer can provide. If you are reasonably certain of something, say so.

 

Expert
A person who has acquired and displays special skills or knowledge of a particular subject. An expert is capable of forming an opinion on the subject in dispute, whereas a person having no particular training may be incapable of forming an accurate opinion or making a correct deduction.

 

Upset Price
A ceiling price commonly found in construction contracts that are based on time and material. The upset price protects the owner against expensive cost overruns. Also, it could specify that any cost savings (actual cost versus standard costs) are divided between the parties of the contract.

 

Bid Shopping
Before a bid is submitted, a general contractor may attempt to obtain prices from potential subcontractors and material suppliers that are lower than the general contractor’s original estimates. After a contract is awarded, a general contractor may pressure or induce subcontractors to reduce their subcontract prices included in the bid.

 

Corpnership
A partnership in which the general partner and limited partners are corporations. This form avoids the potentially adverse income tax consequences of the earnings of the partnership being attributed to the partners as individuals.

 

Change Audit
A review of a job in progress. The review focuses on changes that may have been directed orally to the contractor’s field staff by contract management and other persons.

 

Larry C. Adams, CFE, CPA, CIA, CISA, teaches fraud examination at the Keller Graduate School of Management of DeVry University in Arizona. He publishes the book and online editions of “Fraud In Other Words.” His Web site is www.larry-adams.com. His e-mail address is fraudwritr@aol.com.

 

ã Copyright 1994 Larry C. Adams. All rights reserved.
“Fraud In Other Words” is a trademark of Larry C. Adams.
 

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