Green's scheme, where he did not turn in orders and spent customer down payments, is best classified as which type of fraud?

Green's actions of not turning in orders and spending customer down payments align with the definition of an unrecorded sales (skimming) scheme. In this type of fraud, the perpetrator takes cash from customers but does not record the sales in the company's books. As a result, the income does not appear in the financial statements, allowing the fraudster to misappropriate funds without detection.

In Green's case, he collected down payments but failed to register these transactions, thereby skimming off the money for personal use. This method allows the fraudster to disguise the theft by avoiding any documentation that would typically accompany legitimate sales. The absence of records makes it difficult for the organization to trace missing funds back to sales activity, thereby facilitating the fraud.

Other schemes, such as commission schemes or cash larceny schemes, involve different methods of manipulation or theft of funds, either through falsifying sales to gain commissions or stealing cash that has already been recorded. Green's actions do not fit those definitions, as they specifically involve the initial failure to record transactions altogether. Hence, the classification as an unrecorded sales (skimming) scheme accurately reflects the nature of the fraud committed.