The banking world can be a tricky one to navigate. Whether as an individual or a business owner, it’s surprisingly easy to find yourself on the wrong side of the law without necessarily realising it.
A common offence that you might end up committing (or being a victim of) is bank fraud, and it’s important that you take the implications of this crime seriously. Unfortunately, relatively few people have a thorough legal understanding of these kinds of crimes, making it even more important to seek legal advice early on.
From a brief legal definition to an overview of the ramifications of being found guilty, in this article, we aim to shed light on a complex and scary situation.
Legal definition of bank fraud
Bank fraud typically refers to situations in which fraudulent means are used to illegally access a bank account, taking money from the bank or from the bank’s customers.
In most cases, bank fraud is dealt with using the Fraud Act 2006. This act provides three definitions of fraudulent activity, including fraud by false representation, fraud by abuse of position, and fraud by failure to disclose information. All of these kinds of fraud can apply in bank fraud cases.
In all kinds of fraud, bank fraud included, a central part of the definition is intent. For fraud to apply, the suspect must have intentionally defrauded someone, rather than accidentally doing so. This applies perhaps especially to cases of fraud by failure to disclose information.
Common real-life examples
There is a wide range of different ways in which bank fraud can be carried out, the number of which is only increasing due to the growing prevalence of online banking. Below are just a handful of examples to be aware of:
- Authorised fraud consists of cases where a real customer is tricked into transferring their funds into an account that’s controlled by a criminal. This is often done by calling or sending texts pretending to be another, legitimate institution such as a bank, and stating that the transfer must be made to this institution. These kinds of bank frauds are often carried out by targeting vulnerable individuals, especially the elderly, who might lack digital literacy.
- Unauthorised frauds on the other hand consist of cases where the ‘genuine’ account holder is not aware of the situation, and does not participate in the transferral. Here, the fraudster will somehow obtain bank details through illegal means, such as by hacking accounts or cloning bank cards, and then use those details to transfer the funds into their account.
Another kind of fraud is where the victim is the banking institution itself, rather than a customer of the bank. In these situations, the fraudster might create a fraudulent application for a loan, either manipulating their personal information or creating another identity entirely in order to gain access to funds they wouldn’t otherwise be eligible for.
These kinds of banking scams are increasingly common, and it’s estimated that around £1.2 billion was stolen using these kinds of frauds in 2019 alone. As a result, more resources are being put towards catching bank fraudsters, making it even more important that you take the defence of any investigations seriously.
How can you create a defence?
As with any criminal defence, how you go about formulating your defence will depend on the circumstances of your specific case. However, given how central intent is in fraud cases, it can often be wise to focus on this when developing a defence.
This is especially relevant to cases of fraud by false representation and fraud by failure to disclose information. If your solicitor thinks it is likely that you can argue that your omission of information, or the false information that you supplied, was an accident, then you can very probably build a strong defence around that point.
How will you be investigated?
Unlike most crimes, cases of bank fraud will typically be investigated by a number of different enforcement agencies. In addition to the Crown Prosecution Service, this includes the Financial Conduct Authority, HM Revenue and Customs, and the Serious Fraud Office.
It’s crucial that your solicitor has experience dealing with all these enforcement agencies, as it will have a substantial impact on the outcome of your case. When choosing a solicitor, ask them about their experiences dealing with cases of a similar nature to yours, so that you can be certain that they’re up to the task.
Legal implications of being found guilty
Fraud is a very serious criminal offence to be found guilty of, something that is clearly reflected in the sentencing guidelines. If found guilty of conspiracy to defraud, you can face up to 10 years in prison, with an offence range of between discharge and 8 years in prison.
While you would only receive a sentence towards the upper end of that range if you played a leading role in a large, sophisticated criminal conspiracy, you could still absolutely face a custodial sentence for smaller acts of bank fraud. It’s vital that you take these legal outcomes seriously if you want to avoid them.
When is best to seek legal advice?
Bank fraud cases are a big deal, and you can expect to be investigated by a number of different bodies should you be a suspect. It’s crucial that you reach out for legal advice sooner rather than later, ideally before you’re charged or brought in for questioning.
Your solicitor might be able to liaise with the relevant investigatory bodies, ensuring that you don’t inadvertently worsen your situation. This especially applies to situations where you’re being questioned, where you have a legal right to advice from a qualified legal professional.
Dealing with cases of bank fraud properly requires a timely approach and assistance from a team of solicitors with expertise in this often complicated legal niche. Whether you’re looking to seek compensation from your bank or you want to build a solid defence against a fraud accusation, having more time on your side will never damage your position.
Facing charges for bank fraud? For further advice specific to your charges, reach out today by calling on 0161 234 0020 (MANCHESTER) / 0203 053 8625 (LONDON) / 07956 555797 (24 HOUR). You can also contact our team of solicitors directly.
