Fraud (Advanced Flashcards)
Fraud Act 2006
What is one general offence of fraud which can be committed in three different ways?
(I) By false representation
(II) By failing to disclose information
(III) By abuse of position
Section 1 Of the Fraud Act 2006 Provides:
A person is guilty of fraud if he is In breach of any of the sections listed in subsection (2)
(Which provide for different ways of committing the offences)
Section 1 of the Fraud Act 2006 provides as follows:
A person is guilty of fraud if he is in breach of any of the sections listed in subsection (2) (which provide for different ways of committing the offence).
Subsection (2)
(a) Section 2: Fraud by false representation
(b) Section 3: Fraud by failing to disclose information
(c) Section 4 Fraud by abuse of position
The first Flashcard represents the subsection (2) of the fraud act
See this card has a sense of repetition
A vital point of Section 1 Of The Fraud Act 2006 Subsection (2)
Fraud offences are all conduct offences and will be committed upon completion of the Defendant’s fraudulent conduct.
It is not necessary for the purposes of the offences that anyone actually be defrauded
Brief example
Colourblind person wants a blue car
Owner has a green car but lies and states it’s “Blue”
(False representation already established)
Colourblind person isn’t really blind and has failed to be defrauded
No need to establish that the buyer was defrauded
Section 2 Of The Fraud Act 2006
2.1 Fraud By False Representation
A person is in breach of this section if he:
(a) Dishonesty makes a false representation and
(b) Intends, by making the representation:
(I) To make a gain for himself or another, or
(II) To cause loss to another or to expose another to a risk of loss
Section 2 Of The Fraud Act 2006
2.1 Fraud By False Representation
Actus Reus (FLASHCARD NO.1)
(KEY PART)
Making a False Representation
Section 2 (3) Provides that the Acts Reus of the offence covers:
“Any representation as to fact or law, including a representation at to the state of mind of—
(a) the person making the representation, or
(b) Any other person
How can a representation be done?
(Example when flipped: Car example)
Directly verbally communicating it
Person 1: “I have a blue car”
Confirming someone else’s assumptions of the colour indirectly
Person 1: “You have a lovely blue coloured car”
Person 2: “Thank you”
Through a silent physical action
Person 1: “If you have a blue car please stand on the left hand side of the room”
Person 2: Moves to the left
By doing nothing
Person 1 to Person 3: “Person 2 Has a lovely blue car”
Person 2: Does not react
Section 2 (4) Of The Fraud Act
Using the example how would you phrase a representation in legal terms?
HINT: Expressed and Implied
(Underlined parts + Bold parts are extremely important)
Section 2 (4) Of the Act set out that a representation may be expressed or implied
Expressed Representation
Doing (Through a silent physical action)
Saying something (Directly Verbally Communicating)
Implied Representation
Acting in a way that implies that things are a certain way (Thank you implies confirmation and acceptance)
Staying silent in those circumstances (Implies acquiescence to what is being said)
Section 2 (4) Of the Act set out that a representation may be…..?
(These are the only parts you need to know, the Flashcard behind used the car example to better your understanding)
Expressed Or Implied
2.1 Fraud by False Representation Case Law
2.1.1 Actus Reus Within the Case Law
MetroPolitan Police Commissioner V Charles (1977)
The defendant had been told by his bank manager that he was not to cash more than one cheque a day and was only authorised to write cheques for amounts up to the value of £30.
The defendant, ignoring this, went out and wrote a number of cheques to casinos which subsequently bounced.
The House of Lords held that by handing over these cheques he was impliedly representing that he had an account with the bank named on the cheque and that he had their authority to make out the cheques.
As this was not the case his representation was held to be false.
Deception created fraud
The D Obtained A Pecuniary Advantage By Deception
2.1 Fraud By False Representation
2.1.1 Actus Reus
In this case, the defendant Mr Rai applied to the council social services for a sum of money to enable him to undertake necessary adaptations in his home in order that he could care for his elderly mother there.
The council agreed to provide assistance amounting to £9,500 and later that year they began works in Mr Rai’s home.
At the time the council had started works, however, Mr Rai’s mother had passed away and Mr Rai did not inform the council of the change in circumstance as he wished to keep the grant regardless.
The Court considered Mr Rai’s conduct as a whole and held that it had amounted to a continuing representation that his mother was alive and that the works were undertaken for her benefit.
As she had died already this was no longer the case and Mr Rai held a new intention that the works would be carried out for his own benefit. By doing nothing and allowing the works to be undertaken in his house Rai was continuing the representation.
This case demonstrates how a representation will be held to have been made where the defendant has deliberately omitted to change a perception that another person holds.
2.1 Fraud By False Representation (STILL ON)
2.1.2 Men’s Rea (MAIN TOPIC OF FC)
Dishonestly;
Knowing the representation is untrue or misleading, and;
Intending to make a gain, cause a loss, or cause a risk of loss
2.1 Fraud by false presentation (STILL ON)
2.1.2 Men’s Rea
Dishonestly
Is a subjective concept
Assessed using application of common law test set out in R V Ghosh
According to the ordinary standards of reasonable and honest People were the defendants actions dishonest?
If it was dishonest by those standards, then did the defendant himself realise what he was doing was dishonest?
2.1 Fraud by False Representation
2.1.2 Men’s Rea
Knowing the representation is untrue or misleading
This element of the men’s Rea requires:
Requires a subjective understanding on the part of the defendant
Not sufficient for the defendant to simply say what they believed and for it to be accepted as a fact, their state of mind is a matter of fact (Jury)
Actual knowledge that the representation might be untrue and not simply a reckless awareness of a risk that it might be untrue
2.1 Fraud By False Representation
2.1.2 Men’s Rea
Intending to make a gain, cause a loss, or cause a risk of loss.
Section 5: How gain and Loss will be interpreted
(Section 5 (2) Flashcard)
Section 5 (2)
“Gain and loss extends to any gain or loss in money or property”
Property is interpreted widely:
Any property whether real or personal
Things in action
Intangible property such as shares or intellectual property rights.
General Point for 2.1.2 Men’s Rea
Is there a need for an intention to permanently deprive?
No (Broken down into bullet points)
There is no need for an intention to permanently deprive as the gain or loss includes any gain or loss whether it is temporary or permanent. (Main bullet point)
The gain must merely be a general gain and does not have to be a selfish gain.
An intention to make a gain for another person is sufficient for themens rea.
Section 5 (3)
Section 5 (4)
S.5(3)
“Gain Encompasses keeping what one has, as well as a gain by getting what one does not have”
S.5(4)
“loss includes a loss by not getting what one might get, as well as a loss by parting with what one has”
