A worker's compensation scheme involves an employee making a false claim about a work-related injury to receive insurance benefits. In this type of fraud, the insurance carrier is the entity that directly pays the fraudulent claim from its funds. Therefore, the insurance carrier is the primary financial victim. The employer is considered a secondary victim because fraudulent claims can lead to an increase in their future insurance premiums, but they do not pay the claim directly. This distinguishes it from other employee frauds, like asset misappropriation, where the employer is the direct and primary victim.

A. Employee’s fraud cash filter: This is not a recognized fraud classification; however, any cash-related fraud by an employee directly victimizes the employer.

C. Employees’ recognized codes of conduct: This represents a set of internal rules and ethical guidelines, not a type of fraudulent scheme.

D. Worker’s profit scheme: This is not a standard or recognized term for a type of occupational fraud scheme.

1. Association of Certified Fraud Examiners (ACFE). (2023). Fraud Examiners Manual, International Edition. Section 1.803, "Workers' Compensation Schemes." The manual details how these schemes are committed by employees who lie about the existence or extent of an injury to receive insurance payments, thus victimizing the insurance provider.

2. Singleton, T. W., & Singleton, A. J. (2010). Fraud Auditing and Forensic Accounting (4th ed.). John Wiley & Sons. Chapter 10, "Insurance Fraud," pp. 229-230. The text explains that in worker's compensation fraud, "The insurance company is the victim when false claims are paid."

3. Crumbley, D. L., Heitger, L. E., & Smith, G. S. (2017). Forensic and Investigative Accounting (8th ed.). Wolters Kluwer. Chapter 19, "Insurance Fraud," p. 486. The chapter describes various types of worker's compensation fraud perpetrated by employees against the insurance carrier, such as faking an injury or exaggerating its severity.