Criminal Law Chapter 16 The Fraud Occurs When The Insured Makes

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Student name:__________

1) Distinguish false-vehicle schemes, false-theft schemes, and inflated-theft-loss schemes.

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2) Describe a chop-shop operation.

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3) How does a salvage switch work?

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4) Discuss the factors contributing to the theft of off-road and heavy equipment.

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5) Why is vehicle identification the most difficult and time-consuming task faced by an

investigator in an auto theft case?

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6) What was the purpose behind the passage of the Motor Vehicle Theft Law Enforcement

Act of 1984?

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7) Describe some of the principal investigative steps in determining whether a vehicle fire is

accidental or arson.

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8) What is odometer fraud and why is it a significant offense?

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9) Discuss the nature and seriousness of marine theft.

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10) What is avionics and why is avionics theft prevalent?

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11) _________blank is defined as the process of fabricating a vehicle’s sale to a purchaser in

a jurisdiction that does not issue salvage titles or carry title brands forward, thereby obtaining a

clean title on the vehicle.

11) ______

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12) Since 1954, American automobile manufacturers have used a(n)_________blank instead

of an engine number as the primary means of identification.

12) ______

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13) _________blank is the process, mandated by law, of attaching VIN labels to the major

parts of vehicles in high-theft lines.

13) ______

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14) A short circuit in the_________blank is the most common excuse offered for automobile

fires.

14) ______

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15) Theft deterrent devices are of two types—passive and active. A(n)_________blank

system requires that the operator do something every time the vehicle is driven or parked.

15) ______

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16) In 1977,_________blank became the first state to enact legislation mandating

photographic inspection prior to issuance of a policy.

16) ______

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17) One of the most costly consumer frauds of modern times is_________blank fraud, also

known as rollbacks and clocking.

17) ______

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18) Effective November 1, 1972, the Federal Boating Safety Act of 1971 required boats to

have a 12-character_________blank.

18) ______

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19) A boat that is registered by the U.S. Coast Guard is referred to as a(n)_________blank.

19) ______

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20) Ownership and financial disputes over_________blank vessels can be resolved in the

federal courts.

20) ______

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21) The theft of aircraft electronic equipment, or_________blank, can be a highly lucrative

enterprise for thieves.

21) ______

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22) Which of the following categories of motor vehicle thefts is most often engaged in by

teenagers and young adults who steal a car simply to drive it around before abandoning it?

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22) ______

A) temporary theft

B) joyriding

C) professional theft

D) fraud

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23) In the context of the most common means of disposing stolen motor vehicles, a chop

shop is a place where vehicles are

23) ______

A) cut into pieces for easy delivery to recyclers.

B) disassembled for resale of their parts.

C) disposed of for insurance purposes.

D) recycled.

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24) In_________blank, a vehicle is stolen and stripped mainly for valuable accessories that

do not contain any identifying numbers, thus making them difficult to identify and easy to

dispose of.

24) ______

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A) a quick strip

B) cloning

C) joyriding

D) a salvage switch

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25) In order for a successful salvage switch operation to work, the thief must be able to

acquire a salvaged vehicle that

25) ______

A) has all the identifying numbers removed.

B) is no more than three model years old.

C) has all major component parts even if some of those parts are severely damaged.

D) is accompanied by the vehicle identification number (VIN) plate and title.

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26) In the context of the fraudulent theft schemes, which of the following statements best

describes a false-vehicle scheme?

26) ______

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A) It is an insurance fraud in which the owner of a vehicle reports the vehicle stolen but

has actually hidden it.

B) It is an insurance fraud in which a person buys an insurance policy for a vehicle that

does not exist except on paper, has already been salvaged, or does not belong to the person who

buys the insurance.

C) It is an insurance fraud in which the owner of a stolen vehicle reports a greater

financial loss—based on alleged current value, damage, or stolen parts—than is the case.

D) It is a crime that involves rolling back a vehicle’s odometer so that it shows a lower

mileage than is the case and obtaining or altering paperwork to support the fraud.

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27) Which of the following statements is true about a “paper vehicle”?

27) ______

A) It is an insured vehicle that does not exist.

B) It is a cheaply manufactured vehicle.

C) It is an import vehicle.

D) It is a vehicle that is involved in an accident and leaves the scene without being

identified.

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28) _________blank is an insurance fraud in which the owner of a vehicle files a phony theft-

loss either to avoid liability for some conduct that resulted from the use of the vehicle or to

reduce or avoid some financial loss.

28) ______

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A) Inflated-theft-loss scheme

B) False-vehicle scheme

C) Washing

D) False-theft scheme

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29) In the context of the types of theft, the term “_________blank” represents the thefts of

vehicles specifically for use in the commission of other crimes, such as robberies or drive-by

shootings, after which the vehicles are abandoned.

29) ______

A) joyriding

B) fraud

C) temporary theft

D) professional theft

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30) A vehicle exists, actually belongs to the insured, and is actually stolen. How does fraud

occur in this type of situation?

30) ______

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A) The fraud occurs when the insured makes a false claim concerning the physical or

mechanical condition of the vehicle when it was stolen.

B) The fraud occurs when the owner initially purchased the vehicle and insured it for

more than it was worth.

C) The vehicle that exists is not the vehicle that is on the insurance policy.

D) None of these answers is correct.

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31) _________blank is an insurance fraud in which the owner of a stolen vehicle makes a

false claim concerning the physical or mechanical condition of the vehicle when it was stolen;

actually causes some damage or removes some parts on recovery of the vehicle but before it is

inspected by the insurance company; claims there were expensive parts on or improvements

made to the vehicle before it was stolen; or, if no follow-up inspection is conducted by the

insurer, claims certain damage occurred that actually did not happen.

31) ______

A) Inflated-theft-loss scheme

B) False-vehicle scheme

C) Salvage switch

D) Quick strip

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32) In the context of false-vehicle schemes, a variation on the counterfeit- or blank-title

scheme is the_________blank, whereby the criminal manages to conceal the existence of a

lienholder who may have already repossessed the vehicle because of missed payments.

32) ______

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A) salvage title

B) paper vehicle scheme

C) altered title

D) quick strip

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33) Cargo crime involves all of the followingexcept_________blank.

33) ______

A) smuggling

B) counterfeiting

C) product piracy

D) product burglary

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34) Which of the following statements is true about the National Insurance Crime Bureau?

34) ______

A) It is an agency in the United States Department of Justice.

B) It is a branch of the Federal Bureau of Investigation (FBI).

C) It is an information gathering and dissemination body and a law enforcement

assistance agency.

D) It is a division of the United States Department of Transportation.

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35) Which of the following statements about the National Insurance Crime Bureau (NICB) is

correct?

35) ______

A) The National Automobile Theft Bureau was formed in 1912 and is the forerunner of

NICB.

B) The NICB is not a government organization.

C) The NICB assists in the identification of vehicles and helps educate law enforcement

officers in investigative techniques of vehicle identification, fraud, and theft.

D) All of these answers are correct.

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36) What does the National Motor Vehicle Title Information System (NMVTIS) provide to

its users?

36) ______

A) It provides information on whether a vehicle was stolen.

B) It provides information on whether a vehicle is incapable of being transferred.

C) It provides a system whereby a potential purchaser of a used vehicle will be able to

inquire about the status of a vehicle before a final commitment to purchase.

D) All of these answers are correct.

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37) After 9/11, the U.S. Customs was moved from the Treasury Department. Customs

inspectors are now part of

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37) ______

A) the Department of Homeland Security.

B) the Bureau of Customs and Border Protection.

C) the Department of Justice.

D) the Immigration and Naturalization Service.

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38) All of the following identifiers are part of the standardized 17-character vehicle

identification number (VIN)except

38) ______

A) engine type.

B) color.

C) body style.

D) country of origin.

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39) Which of the following systems was implemented in 1981 to provide positive,

individualized means of identifying a motor vehicle?

39) ______

A) the Motor Vehicle Theft Law Enforcement Act

B) the 17-character standardized vehicle identification number (VIN)

C) the confidential engine number

D) the acid restoration system

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40) What is a “gray-market vehicle”?

40) ______

A) a vehicle that is not manufactured for sale or operation in the United States

B) a vehicle that was “scrapped” and is now back in the marketplace

C) a gray-market vehicle refers to the “paint scheme” of a vehicle

D) a vehicle whose vehicle identification number (VIN) plate and the VIN numbers on

parts are not in agreement

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41) Which of the following is a purpose of the Motor Vehicle Theft Law Enforcement Act of

1984?

41) ______

A) to provide a system of permanent identification numbers on up to fourteen major parts

of certain car lines

B) to reduce auto theft

C) to ease the process of vehicle identification

D) All of these answers are correct.

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42) Vehicles most likely to be the object of odometer fraud are

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42) ______

A) older-model high-mileage vehicles.

B) newer-model high-mileage vehicles.

C) older-model low-mileage vehicles.

D) newer-model low-mileage vehicles.

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43) Which of the following statements is true about the Federal Boating Safety Act of 1971?

43) ______

A) It required all boats to be registered.

B) It required boats to have a 12-character hull identification number.

C) It required boats to have a 17-character hull identification number.

D) It required a minimum prison sentence for anyone convicted of driving a boat under

the influence of alcohol or drugs.

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44) Which of the following is a reason why the theft of avionics is lucrative?

44) ______

A) lack of security at airports

B) lack of concern by sales outlets about the identification and source of used equipment

C) ease of removing identifying numbers

D) All of these answers are correct.

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45) When referring to aircraft identification, what is the significance of the “N” number?

45) ______

A) The “N” number is found on each side of the aircraft or on the vertical tail.

B) The “N” number designates a plane as being registered in the United States.

C) Most registered aircraft receive their “N” number when they are manufactured.

D) All of these answers are correct.

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46) In professional theft, a car thief is motivated by very high profits and generally low risk.

46) ______

⊚ true

⊚ false

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47) The major category of vehicle fraud as described in the textbook usually involves the

theft of vehicles by professionals or strangers.

47) ______

⊚ true

⊚ false

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48) Generally, a salvage vehicle is one that has been damaged or wrecked to such an extent

that the cost of repairing is beyond its fair market value.

48) ______

⊚ true

⊚ false

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49) Quick strip is a crime in which stolen vehicles receive the identity of nonstolen, legally

owned vehicles of the same make and model.

49) ______

⊚ true

⊚ false

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50) According to the National Insurance Crime Bureau (NICB), cloned vehicles are also used

to facilitate drug trafficking, money laundering, and for transportation to and from crime scenes

by organized crime.

50) ______

⊚ true

⊚ false

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51) The National Insurance Crime Bureau (NICB) estimates that anywhere from 15 to 25

percent of all reported vehicle thefts involve some type of fraud and that a vast majority of them

involve fraudulent insurance claims.

51) ______

⊚ true

⊚ false

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52) The National Insurance Crime Bureau (NICB) is organized into nine geographic areas,

with its headquarters in the Chicago suburb of Palos Hills, Illinois, serving as the Area 1 office.

52) ______

⊚ true

⊚ false

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53) The Stolen Auto Recovery (STAR) System can scan storage containers in less than 6

seconds while they continue to move.

53) ______

⊚ true

⊚ false

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54) The scope of the theft of heavy construction equipment has led manufacturers, dealers,

and insurers to support the development of a national database of stolen equipment and provide

the services of law enforcement specialists in the recovery of stolen equipment.

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54) ______

⊚ true

⊚ false

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55) An active system is a type of vehicle antitheft device in which the driver does not need to

do anything to activate the system, though they may be required to do something to deactivate

the system.

55) ______

⊚ true

⊚ false

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Answer Key

Test name: chapter 16

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