The Mark Goodwin Resort is an elegant summer resort located in a remote mountain setting. Guests visiting the resort can fish, hike, go horseback riding, swim in one of three hotel pools, or simply sit in one of the many lounge chairs located around the property and enjoy the spectacular scenery. There are also three dining rooms, card rooms, nightly movies, and live weekend entertainment.

The resort uses a computerized system to make room reservations and bill customers. Following standard policy for the industry, the resort also offers authorized travel agents a 10% commission on room bookings. Each week, the resort prints an exception report of bookings made by unrecognized travel agents. However, the managers usually pay the commissions anyway, partly because they don’t want to anger the travel agencies and partly because the computer file that maintains the list of authorized agents is not kept up to date. Although management has not discovered it, several employees now exploit these facts to their own advantage. As often as possible, they call the resort from outside phones, pose as travel agents, book rooms for friends and relatives, and collect the commissions. The incentive is obvious: rooms costing as little as $100 per day result in payments of $10 per day to the ‘‘travel agencies’’ that book them. The scam has been going on for years, and several guests now book their rooms exclusively through these employees, finding these people particularly courteous and helpful.

Requirements:

1. Would you say this is a ‘‘computer crime?’’ Why or why not?

2. What controls would you recommend that would enable the resort’s managers to thwart such offenses?

3. How does the matter of ‘‘accountability’’ (tracing transactions to specific agencies) affect the problem?