Multiple Choice
Which of the following is a direct cost of a credit card data breach?
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6. Internal Controls and Reporting Cash
Fraud and the Fraud Triangle
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What is the term for excessive selling or lending activity to generate fees and commissions?
A
Kiting
B
Churning
C
Embezzlement
D
Lapping
Verified step by step guidance1
Understand the context of the question: The problem is asking for the term that describes excessive selling or lending activity to generate fees and commissions. This is a concept related to unethical financial practices.
Review the provided options: Kiting, Churning, Embezzlement, and Lapping. Each term represents a specific type of financial misconduct or fraud.
Define each term: Kiting refers to manipulating checks or accounts to create artificial balances. Churning involves excessive trading or activity to generate commissions. Embezzlement is the theft of funds entrusted to someone. Lapping is a method of concealing theft by using funds from one account to cover another.
Focus on the term 'Churning': Churning specifically refers to the unethical practice of excessive selling or lending activity to generate fees and commissions. This matches the description provided in the question.
Conclude that the correct term for the described activity is 'Churning,' based on the definitions and context provided.
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