While fraud is essentially theft by deceit, there are so many different forms of deception that there are many different kinds of fraud. Common forms of fraud include:
Credit card fraud
Identity theft fraud
To cover these different forms of fraud, Canada’s Criminal Code provides a broad-based description of potentially fraudulent activity to allow for a wide degree of prosecutorial discretion in laying fraud charges . Most cases of criminal fraud are addressed by Section 380(1) of the Criminal Code. But some forms of fraud can also be addressed by other sections of the Criminal Code or by other legislation. For example, credit card fraud charges are often brought under Section 342 , which covers credit card theft and fraud. Most Tax fraud is typically handled under Section 239 of Canada’s Income Tax Act.
Fraud cases are typically very complicated, especially when combined with any complexities involved with financial transactions. As such, anyone facing fraud charges in Canada should always seek out the services of a highly skilled and experienced fraud lawyer. With more than 30 years of successfully defending clients from fraud charges , the lawyers at Mass Tsang stand ready to help mount your criminal fraud defence.
Fraud According to the Criminal Code
Section 380(1) of the Criminal Code uses a two-part definition to describe fraud: 1) a prohibited act of “deceit, falsehood or other fraudulent means;” and 2) that this act deprives the public or specific person of “any property, money or valuable security, or any service.”
Ensuing sections of the Code describe “intent” as a crucial component of fraud charges and subsequent legal precedents set by Canadian courts mandates that the Crown has to prove intent to secure a conviction. While this is helpful for defending against fraud charges, it also means that people can be charged for their intent to commit fraud, even if they were unsuccessful in their efforts.
Penalties for Criminal Fraud
Penalties for fraud when convicted under Section 380 are based on the monetary value of the property involved. Property values greater than $5,000 can result in a maximum prison sentences of up to 14 years. If the property value exceeds $1 million, the minimum sentence is two years imprisonment. Fraud involving property valued at less than $5,000 can result in a maximum prison sentence of two years.
In determining penalties, courts consider a number of aggravating factors listed by the Criminal Code. These include:
Number of victims.
Impact to the victim(s).
The complexity and degree of planning the offender took to perpetuate the fraud.
Degree to which the offender took advantage of their position within the community.
Destruction of records related to the fraudulent activity.
Any impact to the Canadian economy or financial system.
Value of property involved (thus the two-year minimum sentence for values over $1 million).
When considering an appropriate sentence Judges also consider mitigating factors, such as attempts at restitution, remorse, and not having an existing criminal record .
Most Common Types of Fraud
Because there are so many different ways to deceive people, and because emerging technologies create new ways to deceive, describing all types of fraud could fill a book. Some of the most common types of fraud include
Embezzlement is a type of fraud addressed under Section 322 of the Criminal Code covering theft. Most cases of embezzlement involve a person entrusted with property (money for the most part)—such as an employee—stealing said property through means of deceit. Embezzlement can be a one-time offence, or one that goes on for years, such as when a trusted employee deceitfully skims money from weekly sales.
Similar to Section 380, the penalties for embezzlement include a maximum prison sentence of up to 10 years for property values greater than $5,000, and a maximum prison sentence of two years for embezzlement involving property valued at less than $5,000. There is no mandatory minimum sentence for embezzlement and cases involving amounts less than $5,000 can be addressed under the generally more lenient summary conviction offence category.
Tax fraud is typically prosecuted under Section 239 of Canada’s Income Tax Act. Tax fraud includes the willful deception in writing or by statement to evade paying taxes or by falsely claiming refunds and/or credits not due. Penalties include extensive fines and prison sentences of up to five years.
Mortgage fraud involves the deliberate misrepresentation of information to obtain financing that otherwise would not be granted. There are a variety of mortgage fraud schemes, but all typically include deception about assets and/or income. For example, providing misleading information about income sources and work details, or using false purchaser names on mortgage applications.
Medical fraud usually involves making false claims and/or producing fake receipts to secure unearned medical benefits from insurers. Medical fraud charges are usually brought up under Section 380 of the Criminal Code.
While medical fraud is often a type of insurance fraud, any type of insurance is subject to potential fraud. Knowingly lying on an insurance application or claim can lead to fraud charges, as can any attempt to deceptively claim damages. Charges relating to insurance fraud are usually laid under Section 380 of the Code.
Credit Card Fraud
Most cases of credit card fraud are addressed under Section 342 of the Criminal Code. Charges can be brought for anyone knowingly possessing, using, or selling a credit card(s) that has been forged or altered. People can also be charged with fraud for using a credit card while knowing that it has been revoked or cancelled. Penalties for fraud covered under this section of the Code can result in a maximum penalty of 10 years in prison.
Internet fraud is so common that fraud-related charges are liable to be laid under several different sections of the Criminal Code. Because Internet fraud often involves credit cards and/or unauthorized use of a computer, charges can be laid under Section 342. Charges can also be brought in relation to Section 403 covering identity theft. Internet fraud-related charges can prove especially complex and call for the expertise of an experienced fraud lawyer.
Contact the Expert Criminal Defence Lawyers at Mass Tsang