Fraud by Failing to Disclose Information
Date Produced: 23 October 2009
Title: Fraud
Offence: Fraud by Failing to Disclose Information
Legislation: S3 Fraud Act 2006
Commencement Date: 15/1/07
Mode of Trial: Either Way
Statutory Limitations & Maximum Penalty: 10 years imprisonment
Sentencing Range: New offence - likely to be variable - see s1 Theft Act and obtaining offences.
Aggravating & Mitigating Factors
- The amount involved
- The use to which money was put (spending on luxuries more venal than on necessities)
- Breach of position trust, such as by employee, director or trustee
- Elderly or vulnerable victim
- Extent of loss - Intended and Actual
- Extent of gain - Intended and Actual
- The period over which and the persistence with which the fraud was carried out
- Guilty plea
- Voluntary repayments
- Personal factors such as illness, disabilitiy, family difficulties, etc
Relevant sentencing Guidelines
Confidence Fraud
Sentencing Guidelines Council Definitive Guidelines
Convicted on or after 26 Oct 2009
Fraud/False Accounting
First time offender aged 18 or over who pleaded not guilty
Large advanced fee fraud or deliberate targeting of a large number of vulnerable victims
£500K (SP £750K) - Start Point (SP): 6 years. Range: 5-8 years
£100k - £500K (SP £300K) - Start Point (SP): 5 years. Range: 4-7 years
£200K -£100K (SP £60K) - Start Point (SP): 4 years. Range: 3-6 years
<£20K (SP £10K) - Start Point (SP): 3 years. Range: 2-5 years
Lower advance fee fraud or degree of planning and / or multiple transactions
£500K (SP £750K) - Start Point (SP): 5 years. Range: 4-7 years
£100k - £500K (SP £300K) - Start Point (SP): 4 years. Range: 3-6 years
£200K -£100K (SP £60K) - Start Point (SP): 3 years. Range: 2-5 years
<£20K (SP £10K) - Start Point (SP): 18 months. Range: 26 weeks -3 years
Single transaction involving targeting of a vulnerable vcitim
£500K (SP £750K)
£100k - £500K (SP £300K)
£200K -£100K (SP £60K) - Start Point (SP): 26 weeks. Range: CO (High) -18 months
<£20K (SP £10K) - Start Point (SP): 6 weeks. Range: 2-5 years
Single transaction not involving targeting of a vulnerable victim, no or limited planning
£500K (SP £750K)
£100k - £500K (SP £300K)
£200K -£100K (SP £60K) - Start Point (SP): 26 weeks. Range: CO(Medium)-36 weeks
<£20K (SP £10K) - Start Point (SP): CO (Medium). Range: Fine -6 weeks.
Additional Aggravating Features
- Number involved in the offence and role of the offender
- Offending carried out over a significant period of time
- Use of another person's identity
- Offence has a lasting effect on the victim.
Additional Mitigating Factors
- Peripheral involvement
- Behaviour not fraudulent from the outset
- Misleading or inaccurate advice
Banking and Insurance Fraud and Obtaining Credit through Fraud
Sentencing Guidelines Coucil Definitve Guidelines
Convicted on or after 26 Oct 2009
Fraudulent from the outset, professionally planned and either carried out over a significant period or multiple frauds
£500K (SP £750K) - Start Point (SP): 5 years. Range: 4-7 years
£100k - £500K (SP £300K) - Start Point (SP): 4 years. Range: 3-5 years.
£200K -£100K (SP £60K) - Start Point (SP): 2 years. Range: 18m-3 years.
£5K-£20K (SP £20K)
Less £5K
Fraudulent from the outset, and either fraud carried out over a significant period of time or multiple frauds
£500K (SP £750K) - Start Point (SP): 4 years. Range: 3-7 years.
£100k - £500K (SP £300K) - Start Point (SP): 3 years. Range: 2-4 years.
£200K -£100K (SP £60K) - Start Point (SP): 15 months. Range: 18 months -3 years.
£5K-£20K (SP £20K) - Start Point (SP): 12 weeks. Range: CO (High)-12 months.
Less £5K - Start Point (SP): CO (High). Range: CO (Low)-6 weeks.
Not Fraudulent from the outset, and either fraud carried out over a significant period of time or multiple frauds
£500K (SP £750K) - Start Point (SP): 3 years. Range: 2-6 years.
£100k - £500K (SP £300K) - Start Point (SP): 2 years. Range: 12 months-3 years.
£200K -£100K (SP £60K) - Start Point (SP): 36 weeks. Range: 12 weeks-18 months.
£5K-£20K (SP £20K) - Start Point (SP): 6 weeks. Range: CO (Med)-26 weeks.
Less £5K - Start Point (SP): CO (Med). Range: Fine-CO (High)
Single fraudulent transaction fraudulent from the outset
£500K (SP £750K)
£100k - £500K (SP £300K)
£200K -£100K (SP £60K) - Start Point (SP):26 weeks. Range: 6 weeks-12 months.
£5K-£20K (SP £20K) - Start Point (SP):CO (High). Range: Fine-18 weeks.
Less £5K - Start Point (SP): CO (Low). Range: Fine-CO (Med)
Single fraudulent transaction not fraudulent from the outset
£500K (SP £750K)
£100k - £500K (SP £300K)
£200K -£100K (SP £60K) - Start Point (SP): 12 weeks. Range: CO (Med)-36 weeks.
£5K-£20K (SP £20K) - Start Point (SP): CO (Med). Range: Fine-6 weeks.
Less £5K - Start Point (SP): Fine. Range: Fine-CO (Low)
Additional Aggravating Features
- Number involved in the offence and role of the offender
- Use of another person's identity
Additional Mitigating Factors
- Peripheral involvement
- Misleading or inaccurate advice
Benefit Fraud
Sentencing Guidelines Council Definitive Guidelines
Convicted on or after 26 Oct 2009
Fraudulent from the outset, professionally planned and either carried out over a significant period or multiple frauds
£500K (SP £750K) - Start Point (SP): 5 years. Range: 4-7 years.
£100k - £500K (SP £300K) - Start Point (SP): 4 years. Range: 3-5 years.
£200K -£100K (SP £60K) - Start Point (SP): 2 years. Range: 18m-3 years.
£5K-£20K (SP £20K)
Less £5K
Fraudulent from the outset, and either fraud carried out over a significant period of time or multiple frauds
£500K (SP £750K) - Start Point (SP): 4 years. Range: 3-7 years.
£100k - £500K (SP £300K) - Start Point (SP): 3 years. Range: 2-4 years.
£200K -£100K (SP £60K) - Start Point (SP): 15 months. Range: 18m-3 years.
£5K-£20K (SP £20K) - Start Point (SP): 12 weeks. Range: CO(High) - 12 months.
Less £5K - Start Point(SP): CO (High). Range: CO (Low)-6 weeks
Not Fraudulent from the outset, and either fraud carried out over a significant period of time or multiple frauds
£500K (SP £750K) - Start Point (SP): 3 years. Range: 2-6 years.
£100k - £500K (SP £300K) - Start Point (SP): 2 years. Range: 12 months-3 years.
£200K -£100K (SP £60K) - Start Point (SP): 36 weeks. Range: 12 weeks-18 months.
£5K-£20K (SP £20K) - Start Point (SP): 6 weeks. Range: CO(Med) - 26 weeks.
Less £5K - Start Point(SP): CO (Med). Range: Fine-CO (High).
Single fraudulent transaction fraudulent from the outset
£500K (SP £750K)
£100k - £500K (SP £300K)
£200K -£100K (SP £60K) - Start Point (SP): 26 weeks. Range: 6 weeks-12 months.
£5K-£20K (SP £20K) - Start Point (SP): CO (High). Range: Fine - 18 weeks.
Less £5K - Start Point(SP): CO (Low). Range: Fine-CO (Med).
Single fraudulent transaction, not fraudulent from the outset
£500K (SP £750K)
£100k - £500K (SP £300K)
£200K -£100K (SP £60K) - Start Point (SP): 12 weeks. Range: CO (Med)-36 weeks
£5K-£20K (SP £20K) - Start Point (SP): CO (Med). Range: Fine - 6 weeks.
Less £5K - Start Point(SP): Fine. Range: Fine-CO (Low).
Additional Aggravating Features
- Number involved in the offence and role of the offender
- Use of another person's identity
Additional Mitigating Factors
- Peripheral involvement
- Misleading or inaccurate advice
Guideline Breach of Trust Case
R v CLARK [1998] 2 Cr.App.R. (S.) 95
Save in very exceptional circumstances, where a person in a position of trust, for example an accountant, a solicitor, a bank employee or a postman has used his trusted and privileged position to defraud his partners, clients employers or the general public of sizeable sums of money immediate imprisonment is inevitable unless there are exceptional circumstances or the amount of money involved is very small. The amount defrauded is an important factor and the following guidelines apply where the sums involved are:
- Less than £17,500 up to 21 months imprisonment
- £17,500 to £100,000 2-3 years
- £100,000 to £250,000 3-4 years
- £250,000 to £1 million 5-9 years
- £1 million or more 10 years +
R v KEFFORD (MARK JAMES) [2002] 2 Cr. App. R. (S.) 106
For economic crimes, alternative sentences to imprisonment could be appropriate punishment.
K was employed by a building society and opened false accounts into which he made windfall payments and then withdrew money as needed. The amount of £11,120 was taken. When interviewed the appellant immediately made full and frank confessions. He had no previous convictions. After the discovery of the offences the appellant sold his home so as to be able to repay the sums he had taken. Convicted of theft and false accounting. On appeal his sentence was reduced from 12 months imprisonment to 4 months. The court commented that even in the present circumstances, in cases involving breach of trust where the sum involved was not small, the guidance in Clarke was still applicable even where it was a first offence, however, a sentence of imprisonment should only be imposed when necessary and only for as long as was necessary in view of the overcrowded prison system. For economic crimes, especially where the offender was of previous good character, alternative sentences to imprisonment could be appropriate punishment.
Guideline Benefit Fraud Case
R v STEWART AND OTHERS [1987] 9 Cr. App. R.(S.)
Professional fraudsters who target the benefit system who operate carefully organised frauds on a large scale in which considerable sums of money are obtained, often by means of frequent changes of name or address or of forged or stolen documents. The length of the custodial sentence will depend in the first instance on the scope of the fraud. 2 years imprisonment and upwards.
Others cases consider:
- a guilty plea;
- the amount involved and the length of time over which the defalcations were persisted in (bearing in mind that a large total may in fact represent a very small amount weekly);
- the circumstances in which the offence began (e.g. there is a plain difference between a legitimate claim which becomes false owing to a change of situation and on the other hand a claim which is false from the very beginning);
- the use to which the money is put (the provision of household necessities is more venial than spending the money on unnecessary luxury);
- previous character;
- Matters special to the offender, such as illness, disability, family difficulties, etc.
- Any voluntary repayment of the amounts overpaid.
If immediate imprisonment is necessary, a short term of up to about nine or 12 months will usually be sufficient in a contested case where the overpayment is less than, say £10,000.
(The case of GRAHAM, WHATLEY [2005] 1 CR.APP.R.(S) 115 revises the starting amount in Stewart and decides that that short terms of up to about 9 to 12 months would usually be sufficient in contested cases where the overpayment was less than £20,000. Sentences would depend on an almost infinite variety of factors. Serious aggravating factors, such as the obtaining of large sums, frauds persisted in over lengthy periods, claims for benefit that were fraudulent from the inception, sophisticated fraud involving the use of false and/or multiple identities, and the maintenance of an extravagant lifestyle over the period in question, would be likely to result in substantial periods of imprisonment.)
Guideline Mortgage Fraud Case
STEVENS AND OTHERS (1993) 14 Cr. App. R. (S) 372
In this case, 19 appellants had made 128 mortgage applications in relation to 90 properties. A total of £1.8 million had been obtained over eight years, and £2.5 million worth of further attempts had been made.
The Court of Appeal held that the following should be considered when sentencing for mortgage fraud:
- Whether false names and values were used
- Whether properties and borrowers were invented
- It is an aggravating feature to recruit others to participate in the fraud
- Whether loans for commercial properties were obtained at domestic rates
- The part played by the offender; whether he was a professional man or not (breach of trust)
- Period over which the fraud was persisted in
- Personal benefits derived from the fraud
- Delay between the acts ending and the arrest; between arrest and plea; the nature and timing of the plea is important when there has been a delay
- Character and age of offender
Relevant Sentencing Case Law
Refer to the cases listed under THEFT and OBTAINING in the Sentencing Manual.
Ancillary Orders
(Archbold paragraph references in brackets)
i) Compensation Orders/Restitution (5-411)
ii) Deprivation Orders (5-439)
iii) Disqualification from acting as a Company Director (5-851)
iv) Financial Reporting Orders (5-886c)
Consider Also: Confiscation, SOPO
