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If you have been charged with fraud, the first thing you’re likely to think about is how to defend yourself. If so, this article is for you. Fraud cases are often incredibly complex, technical, and long-running. What’s more, being accused of fraud is a highly stressful experience. In the remainder of this article, we break down the English law on fraud defences into something easily digestible. Beginning with a brief overview of the offences that fall under the category of fraud, we look further at the type of evidence that the prosecution is likely to rely upon, sentences that you could receive if you are convicted, and the defences that may be available to you. This is essential information for you to consider because a successful defence may just help you avoid conviction altogether.
An overview of fraud offences
Fraud encompasses a range of offences, all of which are crimes of dishonesty. Fraud is defined as deliberately deceiving a victim for personal gain such as money or property in a manner that causes them a loss. In recent years, the ways in which fraud is committed have changed due to the increased use of online financial transactions by businesses and individuals. Many fraud cases now relate to cybercrime, such as the purchase of goods digitally using stolen credit card details. This means that fraud cases often involve the use of complex technologies or multiple layers of transactions that can pose evidential challenges to the prosecution.
The are a number of key laws that govern fraud offences in England and Wales. They include:
- Theft Act 1968,
- The Value Added Tax Act 1994
- the Social Security Fraud Act 2001,
- Fraud Act 2006,
- the Companies Act 2006,
- the Identity Documents Act 2010,
- the Economic Crime and Corporate Transparency Act 2023.
Fraud can include:
- False accounting (Section 17 Theft Act)
- False statements by company directors (Section 19 Theft Act)
- False representation (Section 2 Fraud Act) (deliberately lying in order to make a gain for yourself or another, which causes a loss to someone else)
- Failing to disclose information (Section 3 Fraud Act)
- Abuse of position (Section 4 Fraud Act) (where you occupy a position in which you are expected to safeguard a person’s finances and you exploit this dishonestly in order to make a gain for yourself or someone else, and cause a loss to the person whose position you were responsible for safeguarding)
- Obtain services dishonestly (Section 11 Fraud Act)
- Possessing, manufacturing or supplying articles for use in frauds (Section 7 Fraud Act)
What kind of evidence is used in fraud cases?
The prosecution will need to prove that it is you, not someone else, that committed the offence. For example, with online offences, this may be achieved by linking your device with the URL under which the offences were committed. Where fraud involves Internet activity, it is likely that the police will seize your mobile phone, laptop, and other electronic devices, and will attempt to access any documents that are held in the cloud.
To prove a charge of fraud, the prosecution will have to provide direct evidence that the activity in question took place. For example, in a case of online credit card fraud, the prosecution would need to show that the defendant obtained the victim’s credit card details and used them in order to make purchases online. They will also need to prove that these activities took place dishonestly and deceptively i.e. without the victim’s knowledge and consent.
In order to achieve a conviction, the prosecution will need to prove all of the elements of the offence beyond reasonable doubt. This means the judge or jury must be almost sure that the defendant is guilty. To ensure this, the prosecution usually has to produce a large quantity of complex financial evidence. Using the example of credit card fraud, this might include documents such as Chip and PIN audit trails, transaction summaries, and merchant logs. These will need to be closely analysed by the court and relevant experts (which, interestingly, sometimes leads to the prosecution’s case falling apart).
What is the maximum sentence for fraud?
Fraud is an ‘either way’ offence. This means that it may result in a custodial sentence, or it may result in a lesser sentence such as a fine or community service. The maximum sentence for fraud is 10 years’ imprisonment. In many cases, however, it is likely to be substantially less than this. When deciding on a sentence, the court will mainly consider the culpability of the defendant and the harm caused to the victim.
Culpability means the extent to which the defendant should be blamed for the offence.
Factors that indicate a high culpability include having a leading role in a group activity, pressurising others to commit an offence, or abusing a position of trust. You will be considered less culpable if, for example, you were not motivated by personal gain or if you committed the offence opportunistically.
For the purpose of sentencing, ‘harm’ can be understood by its ordinary everyday meaning. When assessing harm, the court will look at the extent of the financial loss that has taken place. If the fraud had not yet occurred (i.e. if someone was caught in the act but didn’t complete the fraud), the court looks at the intended or risked loss. The court will also look at other ways in which the offence has impacted the victim.
Bringing this all together under the sentencing guidelines, a charge of false accounting that involved a loss of £500,000 or more where there was a high level of culpability might result in a custodial sentence of at least 5 and a half years. The same charge where the loss was less than £5000 and the level of culpability was low might receive a fine representing one week of the defendant’s income. Detailed sentencing guidelines can be found here.
What are the applicable fraud defences?
Defences are a complicated area of the law and it’s not always clear which defence will apply to your case. That said, with fraud, there is a defence that is very commonly argued: lack of dishonesty.
Lack of dishonesty
The most common defence to the charge of fraud is the absence of dishonesty. You can argue that while you did perform the act, you did not do so dishonestly. Here are some examples:
- You are charged with false accounting, but the errors in the accounts were not intentional
- You used someone else’s credit card to make an online payment, but with the card holder’s knowledge and consent
- You are accused of making a false representation, but you were not aware at the time that you were making an untrue statement
When it comes to the offence of failure to provide information, you cannot rely on being ignorant of the relevant legal provisions. Ignorance of the law is never a defence. However, you may nonetheless be able to offer the defence that you were not acting dishonestly. You should consult a solicitor for specialist advice on this.
So, how does the court ultimately decide if the defendant acted ‘dishonestly’? This is a complex question and even the courts themselves have debated how to answer it. For now, at least, courts consider (a) what you knew of the facts at the time of the offence, and (b) whether your behaviour would be considered ‘dishonest’ by the standards of ordinary people.
Therefore, when the court is assessing whether you acted dishonestly, it will consider what you knew of the facts at the time of the offence. It will then assess whether your behaviour would be considered to be dishonest by the standards of ordinary people.
General defences
In some circumstances, you may be able to rely upon what is called a ‘general defence’. General defences relate to the person accused rather than the crime itself. General defences include:
- Automatism (you were not aware of your actions when committing the offence)
- Duress (someone or some circumstance forced you to commit the offence)
- Insanity (because of your mental condition, you did not intend to commit the offence)
- Intoxication (you were so drunk or drugged that you did not intend to commit the offence)
- Mistake (you were mistaken as to certain circumstances and would not have committed the offence is you had known otherwise)
- Self-defence (you committed the offence in order to protect yourself, your property, others, or other’s property)
Exactly how these defences apply to fraud is complex and sometimes not all these defences will be available. It’s best to consult with a solicitor if you think you need to use a general defence.
What will a successful defence achieve?
A successful defence may lead to you being acquitted or convicted of a lesser charge. Defence outcomes can vary considerably, however, so it is best to consult a solicitor to get a clearer idea about how a successful fraud defence might affect your case.
Where can I get help with fraud offences?
If you or a loved one have been accused of fraud, contact Stuart Miller Solicitors today. Our highly qualified team of criminal defence lawyers will be able to provide you with specialist advice and guidance. For a complex matter such as fraud, the right advice and assistance may just make all the difference and help you get your life back on track. To arrange a friendly no-obligation consultation, please get in touch.
(This page was last updated on November 22, 2023.)
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