To detect nonconforming schemes, fraud examiners should examine which items for red flags?

• A. Contract or PO Specifications
• B. Contractor's Statements, Claims, Invoices, and Supporting Documents
• C. Received Product
• D. All of the Above

Answer: (D)

To detect nonconforming schemes, fraud examiners should examine the contract or purchase order specifications, the contractor’s statements, claims, invoices, and supporting documents, and the received product. Each source provides a different angle on what was required and what actually happened. The specifications establish the expected quality and criteria. The contractor’s statements, claims, and invoices reveal representations, pricing, and potential overbilling or false claims, along with supporting documents like change orders or correspondence that can hide alterations. The received product gives tangible evidence of what arrived and whether it meets the agreed standards. Red flags arise when these sources don’t align—for example, goods delivered that don’t meet specs yet are billed or claimed as conforming, or invoices and supporting docs that contradict the delivered item. Reviewing all three areas together increases the chance of uncovering misrepresentations, substitutions, or other fraudulent activity that a single source might miss.