Fraud by false representation – What you need to know

Fraud is a highly complex legal subject, with multiple different angles and related offences. It is rarely a simple matter, and that’s no different when it comes to fraud by false representation.

While this article acts as a useful introduction to the subject, no amount of reading will substitute for a qualified criminal defence solicitor who has extensive experience with fraud cases. If you face fraud-related charges e.g. insurance fraud, it’s imperative that you seek assistance to develop your defence at the earliest opportunity available.

 

Fraud by false representation defined

Under UK law, fraud in general is defined as making a dishonest representation that is intended to bring about the loss of another, your own advantage, or most commonly, a combination of the two.

The offence of fraud by false representation is covered by the Fraud Act 2006, under Section 2. According to the act, 1) not only must the representation be untrue or misleading, but 2) the defendant must also know that this is the case. This means that if the defendant had made an honest mistake, a criminal defence solicitor could argue that they were innocent. Finally, 3) the intention must have been to bring about personal gain, or to cause loss for another.

 

What if the fraud didn’t actually cause gain or loss?

It’s important to note here that it’s the intention that matters, rather than what actually transpired. If the prosecution can prove that the defendant had carried out actions in line with the three factors listed above, they could still be found guilty even if the action did not actually result in loss or gain.

What this could impact, however, is the sentence. When sentencing, courts often take harm into account as one of their considerations; while the intention to bring about the significant loss of another might be considered a factor against the defendant in terms of culpability, if no loss or gain actually transpired, then the harm caused would potentially be considered minimal.

 

Some examples of fraud by false representation

Fraud by false representation is quite a general term and can apply to a wide range of fraud examples. Essentially, it consists of any fraud in which an individual makes a false statement, communicated in any way, that either serves to their advantage or leads to the detriment of another. This can be explicit, or implicit. Potential examples could include:

• Stating that a loss, of any amount, was incurred when in fact it did not, and claiming for that false loss.
• Stating that your income or assets are more than they actually are when applying for a mortgage or loan.
• Making any false statements when applying for a credit card, in order to appear in a more favourable light.
• Selling a service or assets, in person or online, assets that either do not exist or that are not yours to sell.

As you can see, it’s a broad crime, that doesn’t necessarily only cover typically ‘criminal’ acts. Even what some may see as relatively minor infringements of the rules, such as exaggerating when applying for a mortgage or credit card, can result in very serious criminal charges being brought forward.

 

Sentencing for fraud by false representation

Fraud is no benign legal matter – it is an incredibly serious criminal offence. As a result, the maximum sentence for fraud by false representation is 10 years in prison, combined with a fine. A sentence of this kind will only be given in the most severe cases, where the amount defrauded is more than £500,000, and the defendant was considered highly culpable.

Factors that are considered when assessing culpability include whether the individual was part of a larger conspiracy, the number of victims, whether the victims were chosen as a result of their vulnerability, whether the defendant abused a position of power to carry out the fraud, and how long a timeframe the fraud was carried out over.

Most cases of fraud will not include all the factors listed above. However, it is important that you seek legal representation, to show the court the facts of the case. Being a highly-complex legal area, it’s crucial that your criminal defence solicitor understands the nuances of fraud.

 

Other impacts of a fraud conviction

If you’re found guilty of fraud by false representation, even if you only receive a relatively minor sentence, there will be other impacts on your professional and personal life. 

 

Criminal background checks

An important consideration is that any conviction, warning or reprimand may show up on any criminal background checks you have to undergo for work.

Depending on your profession, this could potentially have a significant impact on how easy it is to find employment, while also impacting your ability to travel to certain countries.

 

Restitution orders

If found guilty, you may be given a restitution order by the court. This means that you must return any stolen goods, assets or money to the victim or victims.

 

Financial reporting order

For individuals who the court considers at high risk of re-offending, the court may choose to give a financial reporting order. This means that the defendant must provide updates on their finances at regular intervals, for a period of up to 15 years.

 

Seeking legal advice

It’s common that defendants underestimate the severity of fraud cases, and don’t reach out for legal assistance until the matter has progressed quite far. With all legal matters, and especially fraud cases, the positive impact that a solicitor can have is in part determined by the amount of time they have to prepare.

This makes it important that you reach out as soon as you suspect you may face legal action, ideally before you’re questioned or charged. Even if you believe that what you did does not constitute an act of fraud, it’s important that you clarify this with a legal professional at the earliest opportunity available.