FRAUD
To criminalise dishonest conduct – lies, withholding information, abuse of position theft=
dishonestly appropriates property of another
FA 2006 (Max 10 years imprisonment- 3 years more than theft)
Guilty if: s.2 (fraud by false representation); s.3 (failing to disclose information); s.4(abuse of
position) 3 ways
FA 2006, s.2: Fraud by false representation
Dishonestly makes a false representation
Intends, by making false representation
o To make a gain for themselves or another OR
o Cause loss to another or to expose another to a risk of loss
Whether V is actually deceived by Ds representation, or V loses or D gains, is irrelevant
Actus reus Mens rea
Conduct Making a Voluntary
representation
Circumstanc -Representation is false Knowledge or foresight of
e -Representation is a possibility
dishonest
Result None None
Ulterior Intention, by making a
mens rea representation ,to make a
gain or cause a loss, or
expose another to a risk
of loss
Actus reus of s.2
Making a representation: dishonestly takes advantage of false representation
1. Subject of misrepresentation: false representation to facts; law; state of mind e.g. car not
stolen (fact). Representation of law when informs someone about a legal detail e.g.
contractual matter, state of mind when states intentions or beliefs e.g. intention to pay for
goods on delivery
2. Recipient of representation: result focus e.g. Ds letter or email never received→ actus reus
complete where representation made; but V does not need to be aware; can be to person or
machine e.g. bank system
3. Method of representation: communication can be orally, writing, gestures etc, indirectly by a
agent – Idrees, other communications e.g. by express and implied representations e.g.
implying authority - Barnard
4. Representation must be false: untrue or misleading, and person knows it is untrue and
misleading. Where D believes statement is false, but in fact is true, no fraud as seen in Deller
(pre-FA 2006) where D sells car ‘free of encumbrances’ in the belief he mortgaged car
(encumbered)→ but mortgage was unsuccessful→ true
Idrees v DPP (2011)
Having failed his driving test multiple times, D arranged for another to pass test on his behalf. D
guilty of fraud by false representation, by agent impersonating to make a gain (pass test)
Barnard (1837)
D entered an Oxford Cobblers and requested boots and straps, D was wearing a cap and gown (worn
by Oxford Uni students) and requested student discount. D was not a student, charged with
deception with clothes sufficient
1
,Implied representation of when D intends to make true representation, but circumstances change
but D omits to inform of change – DPP v Ray
DPP v Ray
D and others got a meal at a Chinese restaurant, D did so intending to pay, but changed mind – ran
out when waiter left the room, guilty of deception
Mens rea of s.2
Foresee risk that representation is, or might be, false: satisfied when D knows representation is
false or misleading, subjective mens rea required, simple negligence insufficient (reasonable
person would foresee)
Dishonesty: no FA definition of dishonesty, left to Ghosh test which jury needs to apply 2
questions
1. Is Ds false representation dishonest according to the standards of
reasonable and honest people?
2. Does D realise false representation would be considered dishonest by
honest and reasonable people
→ TV ad that make false representation e.g. buy this to make play like pro→ not dishonest for
reasonable person
Intention to make a gain or cause loss (or risk of loss): s.2 does not require to make gain or cause
or risk loss in fact, only need ulterior intention to
o ‘gain’ and ‘loss’= money or property (including things in action and intangible); temporary or
permanent; ‘gain’ includes gain what one has or what one does not have, ‘loss’ includes not
getting what one might get
D must intend to cause gain or loss by conduct – Gilbert
Gilbert (2012)
D and others set up bank account to facilitate company (developing and selling real estate). In doing
so, they made false representation about financial position. Appeal allowed, as need of intent to
make gain from representation
FA 2006, s.3: Fraud by failure to disclose information
Breach of s.3 if fails to disclose to another person information which under legal duty to disclose,
with intention to make a gain for himself or another; or cause loss to another or to expose
another of risk to loss
Actus reus Mens rea
Conduct Failing to disclose info Voluntary
Circumstanc -Legal duty to disclose None
e -failure to disclose is Knowledge
dishonest
Result None None
Ulterior Intention, by failing to
mens rea disclose, to make a gain
or cause a loss to another
or expose another to a
risk of loss
2
,Actus reus of s.3: failure to disclose information where D has a legal duty to do so
Identifying a legal duty to disclose information: duty can be from statute, express or implied
terms of a contract failure to disclose render a contract voidable e.g. criminal record when
applying for job or failure to reveal change of financial position when getting benefits – Mashta
When does D fail to disclose: satisfied if D discloses nothing at all, or sufficient information
partial=liable
Mashta (2010)
D continued to receive asylum support on grounds of destitution whilst in gainful employment
fraud by failing to disclose employment
Mens rea of s.3
Dishonest and intended by failure to make a gain or cause a loss or risk of loss to another
S.2 requires knowledge or awareness of risk that representation is false, but s.3 DOES NOT
liable under s.3 even if did not know or even foresee possibility that under legal obligation to
disclose information
FA 2006, s.4: Fraud by abuse of position
Person occupies position expected to safeguard, not act against, financial interests of another
Dishonestly abuses that position
Intends by abuse, to make gain for himself or another, or cause loss or expose another to risk of
loss
Actus reus Mens rea
Conduct Acts or omissions Voluntary
Circumstanc -D occupies a position in -None
e which is expected to
safeguard financial
interests of another -None
-D abuses that position -Knowledge
-Abuse of position is
dishonest
Result None None
Ulterior Intention, by abuse of
mens rea position, to make gain or
cause loss to another or
expose another to risk of loss
Actus reus of s.4
Acts or omission, to abuse position expected to safeguard financial interests of another
Identifying relevant positions: position could include ‘fiduciary duty’ (i.e. civil law duty to act
within interests of another) e.g. employees might use insider knowledge to make secret profits –
Marshall
When does D abuse this position: important term ‘abuse’ not defined flexible lack of certainty
– Pennock
Marshall (2009)
D was a manager of a residential care home for people with extreme learning difficulties, and in that
position had control over a particular resident (Vs) finances. Over a period of time, D withdrew over
£7k from accounts and used for own benefit. D charged with fraud by abuse of position
3
, Pennock and Pennock (2014)
D1 and D1 (husband and wife) opened joint back account with an uncle (v). £100k of Vs money
transferred into account, and later used to buy house for D1 and D2’s daughter V claimed no
knowledge of account, transfer or use of money D1 and D2 charged with fraud under s.4
appealed allowed as abuse not sufficiently clear on facts
Mens rea of s.4
Act dishonestly and intent to abuse position to make gain or cause loss or risk of loss to another
Like s.3, no mens rea required for additional circumstance elements (-D occupies a position in which
is expected to safeguard financial interests of another; D abuses that position) strict liability
elements (require no mens rea) only needs to be in position expected to safeguard financial
interest, and abuse of it liable even if not know in such position
FA 2006, s.11: Obtaining services dishonestly (max 5 years imprisonment)
Guilty if obtain services for themselves or another, by dishonest act and breach of: payment is or
will be made, obtains service without payment or full payment
Actus reus Mens rea
Conduct Acts causing result Voluntary
Circumstanc -D obtaining service is -Knowledge
e dishonest -Knowledge or
-Payment is require for foresight
services -Intention
-No (or insufficient) payment
provided
Result Services obtained for D or Intention
another
Actus reus of s.11
Acquired service for which payment is required, but not paid in full e.g. goods in hire without
paying
Covers where D required to making payment, but opens bank account using false details
Causation crucial e.g. if go to event with intent to pay, but later does not pay, no liability under
s.11 as at time acts to cause services to be obtained, not yet dishonest
Mens rea of s.11
D must know payment for services is or might be required; must intend to obtain service without
paying; and must act dishonestly – apply Ghosh test
Fraud preparation offences – s.6 (possession of articles for fraud) and s.7 (making or suppling
articles for fraud)
FA 2006, s.6: Possession of articles for use in fraud (max 5 years imprisonment)
Guilty if has possession or under control any article in connection with fraud very broad, and
irrelevant if future fraud is completed or not
Actus reus Mens rea
Conduct Possessing or controlling Voluntary
article Knowledge
Circumstanc None None
e
4
To criminalise dishonest conduct – lies, withholding information, abuse of position theft=
dishonestly appropriates property of another
FA 2006 (Max 10 years imprisonment- 3 years more than theft)
Guilty if: s.2 (fraud by false representation); s.3 (failing to disclose information); s.4(abuse of
position) 3 ways
FA 2006, s.2: Fraud by false representation
Dishonestly makes a false representation
Intends, by making false representation
o To make a gain for themselves or another OR
o Cause loss to another or to expose another to a risk of loss
Whether V is actually deceived by Ds representation, or V loses or D gains, is irrelevant
Actus reus Mens rea
Conduct Making a Voluntary
representation
Circumstanc -Representation is false Knowledge or foresight of
e -Representation is a possibility
dishonest
Result None None
Ulterior Intention, by making a
mens rea representation ,to make a
gain or cause a loss, or
expose another to a risk
of loss
Actus reus of s.2
Making a representation: dishonestly takes advantage of false representation
1. Subject of misrepresentation: false representation to facts; law; state of mind e.g. car not
stolen (fact). Representation of law when informs someone about a legal detail e.g.
contractual matter, state of mind when states intentions or beliefs e.g. intention to pay for
goods on delivery
2. Recipient of representation: result focus e.g. Ds letter or email never received→ actus reus
complete where representation made; but V does not need to be aware; can be to person or
machine e.g. bank system
3. Method of representation: communication can be orally, writing, gestures etc, indirectly by a
agent – Idrees, other communications e.g. by express and implied representations e.g.
implying authority - Barnard
4. Representation must be false: untrue or misleading, and person knows it is untrue and
misleading. Where D believes statement is false, but in fact is true, no fraud as seen in Deller
(pre-FA 2006) where D sells car ‘free of encumbrances’ in the belief he mortgaged car
(encumbered)→ but mortgage was unsuccessful→ true
Idrees v DPP (2011)
Having failed his driving test multiple times, D arranged for another to pass test on his behalf. D
guilty of fraud by false representation, by agent impersonating to make a gain (pass test)
Barnard (1837)
D entered an Oxford Cobblers and requested boots and straps, D was wearing a cap and gown (worn
by Oxford Uni students) and requested student discount. D was not a student, charged with
deception with clothes sufficient
1
,Implied representation of when D intends to make true representation, but circumstances change
but D omits to inform of change – DPP v Ray
DPP v Ray
D and others got a meal at a Chinese restaurant, D did so intending to pay, but changed mind – ran
out when waiter left the room, guilty of deception
Mens rea of s.2
Foresee risk that representation is, or might be, false: satisfied when D knows representation is
false or misleading, subjective mens rea required, simple negligence insufficient (reasonable
person would foresee)
Dishonesty: no FA definition of dishonesty, left to Ghosh test which jury needs to apply 2
questions
1. Is Ds false representation dishonest according to the standards of
reasonable and honest people?
2. Does D realise false representation would be considered dishonest by
honest and reasonable people
→ TV ad that make false representation e.g. buy this to make play like pro→ not dishonest for
reasonable person
Intention to make a gain or cause loss (or risk of loss): s.2 does not require to make gain or cause
or risk loss in fact, only need ulterior intention to
o ‘gain’ and ‘loss’= money or property (including things in action and intangible); temporary or
permanent; ‘gain’ includes gain what one has or what one does not have, ‘loss’ includes not
getting what one might get
D must intend to cause gain or loss by conduct – Gilbert
Gilbert (2012)
D and others set up bank account to facilitate company (developing and selling real estate). In doing
so, they made false representation about financial position. Appeal allowed, as need of intent to
make gain from representation
FA 2006, s.3: Fraud by failure to disclose information
Breach of s.3 if fails to disclose to another person information which under legal duty to disclose,
with intention to make a gain for himself or another; or cause loss to another or to expose
another of risk to loss
Actus reus Mens rea
Conduct Failing to disclose info Voluntary
Circumstanc -Legal duty to disclose None
e -failure to disclose is Knowledge
dishonest
Result None None
Ulterior Intention, by failing to
mens rea disclose, to make a gain
or cause a loss to another
or expose another to a
risk of loss
2
,Actus reus of s.3: failure to disclose information where D has a legal duty to do so
Identifying a legal duty to disclose information: duty can be from statute, express or implied
terms of a contract failure to disclose render a contract voidable e.g. criminal record when
applying for job or failure to reveal change of financial position when getting benefits – Mashta
When does D fail to disclose: satisfied if D discloses nothing at all, or sufficient information
partial=liable
Mashta (2010)
D continued to receive asylum support on grounds of destitution whilst in gainful employment
fraud by failing to disclose employment
Mens rea of s.3
Dishonest and intended by failure to make a gain or cause a loss or risk of loss to another
S.2 requires knowledge or awareness of risk that representation is false, but s.3 DOES NOT
liable under s.3 even if did not know or even foresee possibility that under legal obligation to
disclose information
FA 2006, s.4: Fraud by abuse of position
Person occupies position expected to safeguard, not act against, financial interests of another
Dishonestly abuses that position
Intends by abuse, to make gain for himself or another, or cause loss or expose another to risk of
loss
Actus reus Mens rea
Conduct Acts or omissions Voluntary
Circumstanc -D occupies a position in -None
e which is expected to
safeguard financial
interests of another -None
-D abuses that position -Knowledge
-Abuse of position is
dishonest
Result None None
Ulterior Intention, by abuse of
mens rea position, to make gain or
cause loss to another or
expose another to risk of loss
Actus reus of s.4
Acts or omission, to abuse position expected to safeguard financial interests of another
Identifying relevant positions: position could include ‘fiduciary duty’ (i.e. civil law duty to act
within interests of another) e.g. employees might use insider knowledge to make secret profits –
Marshall
When does D abuse this position: important term ‘abuse’ not defined flexible lack of certainty
– Pennock
Marshall (2009)
D was a manager of a residential care home for people with extreme learning difficulties, and in that
position had control over a particular resident (Vs) finances. Over a period of time, D withdrew over
£7k from accounts and used for own benefit. D charged with fraud by abuse of position
3
, Pennock and Pennock (2014)
D1 and D1 (husband and wife) opened joint back account with an uncle (v). £100k of Vs money
transferred into account, and later used to buy house for D1 and D2’s daughter V claimed no
knowledge of account, transfer or use of money D1 and D2 charged with fraud under s.4
appealed allowed as abuse not sufficiently clear on facts
Mens rea of s.4
Act dishonestly and intent to abuse position to make gain or cause loss or risk of loss to another
Like s.3, no mens rea required for additional circumstance elements (-D occupies a position in which
is expected to safeguard financial interests of another; D abuses that position) strict liability
elements (require no mens rea) only needs to be in position expected to safeguard financial
interest, and abuse of it liable even if not know in such position
FA 2006, s.11: Obtaining services dishonestly (max 5 years imprisonment)
Guilty if obtain services for themselves or another, by dishonest act and breach of: payment is or
will be made, obtains service without payment or full payment
Actus reus Mens rea
Conduct Acts causing result Voluntary
Circumstanc -D obtaining service is -Knowledge
e dishonest -Knowledge or
-Payment is require for foresight
services -Intention
-No (or insufficient) payment
provided
Result Services obtained for D or Intention
another
Actus reus of s.11
Acquired service for which payment is required, but not paid in full e.g. goods in hire without
paying
Covers where D required to making payment, but opens bank account using false details
Causation crucial e.g. if go to event with intent to pay, but later does not pay, no liability under
s.11 as at time acts to cause services to be obtained, not yet dishonest
Mens rea of s.11
D must know payment for services is or might be required; must intend to obtain service without
paying; and must act dishonestly – apply Ghosh test
Fraud preparation offences – s.6 (possession of articles for fraud) and s.7 (making or suppling
articles for fraud)
FA 2006, s.6: Possession of articles for use in fraud (max 5 years imprisonment)
Guilty if has possession or under control any article in connection with fraud very broad, and
irrelevant if future fraud is completed or not
Actus reus Mens rea
Conduct Possessing or controlling Voluntary
article Knowledge
Circumstanc None None
e
4
