Fraud can be defined as the deliberate use of deception or dishonesty to disadvantage or cause loss to another person or party. In most cases, fraud involves an advantage that includes financial gain. Fraud is a serious offence and may have serious reputational repercussions for a defendant, their family, and possibly other affiliates.
What constitutes fraud?
In the UK, fraud is governed by the Fraud Act 2006. This act replaced the Theft Act 1968 and the Theft Act 1978.
The main offences under this Act include:
Fraud by false representation
Section 2 under the Fraud Act makes it an offence to commit fraud by false representation. This offence involves a defendant who dishonestly makes a representation to mislead another through words or conduct. An example would be in a situation where you intentionally and dishonestly use a credit card that belongs to a third party to pay for an item. By using this card without permission, you are falsely representing that you have obtained the authority to make a transaction.
Fraud by failing to disclose information when there is a legal duty to do so
This is also an offence under Section 3 of the Fraud Act. Here, a defendant fails to disclose information to another when under a legal duty to disclose information. Like Section 2, there must be dishonesty and an intention to make a gain or cause loss to the claimant.
Fraud by abuse of dominant position
Under Section 4, a person commits this offence where he/she occupies a position that requires safeguarding of another person’s financial interests. Crucially, a person may commit this offence even if his/her conduct was an omission rather than an act.
You will only face charges for fraud if there is an element of dishonesty in defrauding another party.
You have an intention to defraud (which does not necessarily have to involve gain or loss to another party).
Types of fraud
Below are some of the main categories of fraud that you must be aware of:
Benefit fraud
This involves falsely making benefit claims or entitlements. The effects of benefit fraud include the possibility to have future benefits halted, as well as facing financial sanctions.
Banking, insurance, or credit fraud
This type of fraud entails manipulating details from a third party for one’s advantage. For instance, a defendant may have used these details to make fraudulent insurance claims, or even to secure a mortgage.
Revenue fraud
This fraud involves the evasion of VAT, income tax, and even excise duty. In many cases, revenue frauds are reported to the HM Revenue and Customs (HMRC) and may investigate such cases through the accountant of the parties involved.
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