A fake entity that is solely created to bill a company for goods or services it does not receive. A shell company could also be set up to mirror an existing company already used as vendor only this company has a spelling deviation in the name allowing it so the perpetrator to register it as a viable business. When this fraud scheme occurs, the perpetrator writes the check to the shell company, endorses the back of the check and deposits it into the shell bank account. They enter the payment on the books and records as a payment made to the actual vendor. Banks and business managers don’t always notice the deviation in the spelling and think the payment was legitimate.