Fraud and Proceeds of Crime

Fraud offences are extremely serious in nature, they often lead to sentences of full-time imprisonment.

If you have been charged with a fraud or Proceeds of Crime offence, reach out to the team at Australian Criminal Defence to speak with an experienced criminal lawyer about your options. Contact our expert criminal law team on (02) 8815 8151 for a fixed fee rate for your matter.

Fraud offences are extremely serious in nature, they often lead to sentences of full-time imprisonment. Often the main determinant of the likely penalty is the amount that is related to ‘fraudulent’ activity.  There are many offences covered under the broad area of ‘fraud’, some of which include:

• Fraud – Section 192E Crimes Act 1900 (NSW)
• Embezzlement by an ‘employee’ – Section 157 Crimes Act 1900 (NSW)
• Dealing with proceeds of crime – Section 193 Crimes Act 1900 (NSW)

FRAUD

THE OFFENCE:

Section 192E of the Crimes Act 1900 (NSW) provides the offence of fraud. In order to find a person guilty of this offence, the prosecution must prove the following beyond reasonable doubt:

1.      You committed an act of deception

2.      That act of deception results in:

a.      You obtain a financial advantage; or

b.      Someone suffering a financial disadvantage; or

c.       You obtaining property belonging to another

3.      The obtaining of financial advantage, disadvantage or property was dishonest

4.      The intention of the deceptive conduct resulting in financial advantage was to permanently deprive the rightful owner of that property/financial value.

DEFINITIONS

DECEPTION:

Deception is defined to include:

a)      A deception as to the intentions of the person using the deception or any other person

b)      Conduct by a person that causes a computer, machine or electronic device to make a response that the person is not authorised to cause it to make.

DISHONEST:

Dishonest refers to dishonest according to the standards of ordinary people and known by the defendant to be dishonest according to the standards of ordinary people.

OBTAINING PROPERTY:

Obtain a financial advantage includes:

A)     Obtaining a financial advantage for oneself or for another person; and

B)     Inducing a third party to do something that results in oneself or another person obtaining a financial advantage, and

C)      Keep a financial advantage that one has, whether the financial advantage is permanent or temporary.

EMBEZZLEMENT

THE OFFENCE

Section 157 of the Crimes Act 1900 (NSW) provides an offence of Embezzlement. In order to find a person guilty of this offence, the prosecution must prove the following beyond reasonable doubt:

1.      You were a clerk or servant of the employer

2.      You had delivered to, received or took into your possession property on account of your employer.

3.      You did so fraudulently

DEFINITIONS

CLERK OR SERVANT:

Clerk or servant is defined broadly by section 155 of the Crimes Act 1900 (NSW) as an

employee or someone acting in a way where they have authority to receive, collect or pay

money (whether or not they have authority to receive, collect or pay that money).

FRAUDULENT:

A fraudulent act, broadly speaking means something that is deceptive and causes a loss in

some way. The legal definition of fraudulent requires the following to be shown beyond

reasonable doubt.

1.      Your conduct was dishonest and by deception

2.      It created a financial advantage for you or another person over the money/property of another OR caused them disadvantage

3.      Your actions were intentional or reckless.

WHAT ARE COMMON EXAMPLES OF THIS OFFENCE?

1.      Where a person in a place of employment takes a cash payment for a product/service and takes it, rather than putting it in the ‘cash register’..

2.      Where a person in a place of employment sends an invoice to an employer’s customer with wrongful account details (e.g. to the persons personal account details)

I AM NOT GUILTY; HOW CAN I BEAT THE FRAUD CHARGE?

1.      You were not acting as a clerk or servant when taking the funds, OR

2.      You did not receive or deliver property on account of an employer, OR

3.      Your actions weren’t intentional or reckless, OR

4.      You did not create a financial advantage/disadvantage, OR

5.      You did not have the intention to permanently deprive your employer, OR

6.      A defence applies.

MONEY LAUNDERING & DEALING WITH PROCEEDS OF CRIME

THE OFFENCE:

There are multiple offences relating to proceeds of crime, including state and commonwealth charges. In NSW, section 193B & C of the Crimes Act 1900 (NSW) provide the offences of dealing with proceeds of crime. Dealing with proceeds of crime may occur in relation to other matters such as drug supply, however it is also commonly utilised in fraud offences. In order to convict a person of this offence, the prosecution must prove the following beyond reasonable doubt:

In relation to property

1.      You deal with property, AND

2.      There are reasonable grounds to suspect the property is proceeds of crime.

OR

In relation to proceeds of crime

1.      You deal with proceeds of crime, AND

2.      Any of the following.

a.      You are reckless as to whether it is proceeds of crime, OR

b.      You know that it is proceeds of crime, OR

c.       Knowing that it is proceeds of crime, you intend to conceal that it is proceeds of crime

WHAT IS PROCEEDS OF CRIME?

Proceeds of crime is defined as any property or money that is substantially derived or realised, directly or indirectly by any person from the commission of a serious offence.

SERIOUS OFFENCE:

A serious offence, broadly speaking means any of the following offences against the laws of NSW:

a)      Any offence which may be prosecuted on indictment

b)      An offence of supplying a restricted substance contrary to Section 16 of the Poisons and therapeutic goods act 1966 (NSW)

c)      An offence committed outside of New South Wales or Australia that would be an offence referred to if it had been committed in New South Wales

Many offences can be dealt with on ‘indictment’, this means they can or will be taken to the district court in some circumstances. Examples include funds substantially realised from drug supply, fraud, embezzlement.

WHAT CONSTITUTES DEALING WITH?

Dealing with includes receiving, possessing, concealing, disposing or moving proceeds of crime. This can include by gifting, mailing or transfer by electronic transaction.

I AM NOT GUILTY; HOW CAN I BEAT THE CHARGE?

1.      The funds were not proceeds of crime or could not be reasonably suspected of being proceeds of crime

2.      You did not deal with those funds

3.      A defence applies

PENALTIES

If you are guilty of any of the above offences, our team will help prepare your defence including references, expert reports, apology letters, and evidence of rehabilitation. The next step is that you will be sentenced. The table below shows the relevant penalty for each offence. For all offences dealt with in the local court, the maximum penalty is 2 years imprisonment. For matters dealt with in the district or Supreme Court (on indictment), the maximum penalty is as displayed below.

The maximum penalties are reserved for the “worst category” of offenders (Veen v The Queen (No 2) (1988) 164 CLR 465 at 478) and are not commonly utilised by the court. A court has the discretion to sentence an offender in accordance with the Crimes (Sentencing Procedure) Act 1998 (NSW).

DEFENCES

DURESS

The defence of duress is available in circumstances where the accused person is threatened in a way where they are forced to commit a crime against their will. It requires four things to be shown, once the defence is raised, the prosecution must disprove beyond reasonable doubt that the defendant was not acting under duress:

1.      An actual threat was made to the accused

2.      The threat was serious enough to justify the accused’s actions

3.      The threat was acting on the mind of the accused at the time of the offence

4.      The threat was continuing

CLAIM OF RIGHT – FOR FRAUD & EMBEZZLEMENT ONLY

A person will have a claim of right where a genuine belief is held that you have a claim of right to certain property. Once raised, the prosecution must prove that you didn’t have a claim of right beyond reasonable doubt. Various principles exist to guide the scope of whether a person has a ‘claim of right’ defence:

1.      Must be one that involves a genuine subjective belief as to your right to property held by another.

2.      This must be an understanding of a legal entitlement rather than some kind of moral entitlement.

3.      It extends to something of equivalent value, it is not required that the person reclaim the precise product they believe is theirs (for example, if you believe that person B stole a $50 note from you, it is not necessary you take back that exact $50 note, another $50 note of the same value would suffice).

NECESSITY

The defence of necessity is available in circumstances where the accused is incited in some way (often by a threat or identification of a potential harm) to break the law to avoid even more dire consequences. The defendant must show the following (R v Loughnan [1981] VR 443 at [448]:

a)      The criminal act must have been done in order to avoid consequences of irreparable evil upon the accused or others whom they were bound to protect

b)      The accused must honestly have believed on reasonable grounds that they were placed in a situation of imminent peril; and

c)      The acts done to avoid the imminent peril must not be out of proportion to the peril to be avoided.

Fraud & White Collar Crime Case Studies

• Our client was charged with fraudulently obtaining $130,000 from his employer over a four year period.  This offence carries a maximum term of imprisonment of 10 years.  Our client indicated a plea of guilty. The matter proceeded to sentence at Parramatta Local Court.  Our well prepared case resulted in the magistrate ordering that our client can serve his term of imprisonment in the community by way of home detention.
• Our client was charged with fraudulently obtaining $240,000 from her employer. After successful negotiations the prosecutor agreed to reduced the amount to $177,000. The matter proceeded to sentence at Central Local Court.  Our well prepared case resulted in the magistrate ordering that our client can serve her term of imprisonment in the community by way of a intensive corrections order.
• Our client was charged with obtaining $45,000 from their employer.  Our client denied the allegation. Our client defended the charge. The matter proceeded to a hearing at Liverpool Local Court. The magistrate agreed with our team that the prosecution could not prove their case beyond reasonable doubt. The charge was dismissed.

If you have been charged with a fraud offence, reach out to the team on 0415 932 866 to speak with an experienced criminal lawyer about your options and prospects.