Obtaining insurance
Date Updated: January 2012
Title: Theft
Offence: Obtaining property by deception - insurance fraud
Legislation: S15 Theft Act 1968
Commencement Date: Repealed as from 15.1.2007 by the FRAUD ACT 2006, however under transitional provisions this section is still applicable to offences where the offence was partly committed before 15 January 2007- see section14(2) and schedule 2 of the Fraud Act for detailed provisions.
Mode of Trial: Either Way
Statutory Limitations & Maximum Penalty: 10 years
Culpability & Harm
- Substantial claim
- Substantial Loss
- Claim entirely fraudulent
- Planning
- Offending carried out over a long period
- Offender acting with others
- Offender recruited others
- Offender prime mover
- Motivated by greed or desire to live beyond his or her means
- Commit or arrange original offence
Aggravating & Mitigating Factors
None
Relevant Sentencing Guidelines (If Any)
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. 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.
Relevant Sentencing Case Law
R v Bedding and others (1995) 16 Cr. App. R. (S) 101, Current Sentencing Practice B6-33C12
Pleaded guilty to conspiring to obtain by deception. The defendant obtained insurance to cover jewellery that did not exist, staged a false burglary and claimed £16K. 12 and 6 months.
R v Michael (1990) 12 Cr. App. R. (S) 223 Current Sentencing Practice B6-33C07
Pleaded guilty to one count of obtaining property by deception and one of attempting to obtain property by deception. The defendant made two false claims maintaining that watches and jewellery worth £3K had been stolen in two burglaries. Total 6 months.
R v Thomas (1994) 16 Cr. App. R. (S) 539 Current Sentencing Practice B6-33C11
Pleaded guilty to obtaining by deception. The defendant was burgled and inflated the insurance claim by £900. 4 months.
R v Dover (1995) 16 Cr. App. R. (S) 61 Current Sentencing Practice B6-33C13
Pleaded guilty to two counts of forgery, one of procuring the execution of a valuable security by deception, and one of theft. The defendant was chairman of a company responsible for managing a block of flats, which were damaged in storms. He submitted inflated invoices and obtained £4K. 5 months.
R v Ellis [1999] 1 Cr. App. R. (S) 374 Current Sentencing Practice B6-33C16
Convicted of one count of conspiracy to commit arson and nine counts of conspiracy to defraud. The defendant set fire to his warehouse and claimed £2 million for stock supposedly destroyed. 7 years.
R v Mehboob [2000] 2 Cr. App. R. (S) 343 Current Sentencing Practice B6-33C17
Convicted of four offences of conspiracy to defraud and pleaded guilty to three further similar offences. The defendant staged false car accidents and made seven claims for £34K. Serious conspiracies with corrupting elements. The defendant had been really in starting this whole exercise off and remaining at the centre of it. He was the person to whom the others in the locality where he was so well-known would come, he was the person who facilitated the commission of these offences, and it was in that, over this substantial period of time that the real seriousness of these offences lay. 4 years
R v Munns [1992] 13 Cr. App. R. (S) 470
Pleaded guilty to obtaining property by deception. The defendant used his car for parts and falsely claimed that it had been stolen. The insurance company paid out £3925. 6 months.
R v Nall-Cain (Lord Brockett) [1998] 2 Cr. App. R. (S) 145
Pleaded guilty to conspiracy to defraud and obtaining by deception. The defendant exaggerated the value of his cars by £1.5 million, staged a false burglary and used the cars for spares. Insurers not pay out. 5 years.
R v Morgan [1994] 16 Cr. App. R. (S) 478
Pleaded guilty to three counts of attempting to obtain by deception. The defendant falsely reported the death of his wife and claimed £200K on her life policy. No money paid out. Sophisticated fraud. 2 years.
R v Lusher [1995] 16 Cr. App. R. (S) 313
Pleaded guilty to attempting to obtain by deception and perjury. The defendant produced various documents from the Philippines purporting to show that his wife had died there. Claims were made on four insurance policies for sums amounting to £155,000 and the defendant swore an affidavit to obtain probate in respect of his wife's estate. Surrendered himself. 2 years.
R v Hurst [2004] 1 Cr. App. R. (S) 80
Pleaded guilty to conspiracy to defraud. The defendant made a claim on his insurance after a relative set fire to a factory that he thought was failing. The defendant was not involved in the starting of the fire.18 months.
Ancillary Orders:
- Compensation Orders: 5-411
- Deprivation Orders: 5-439
- Disqualification from acting as a Company Director: 5-851
- Financial Reporting Orders: 5-886c
Consider Also:
- POCA
- Financial Reporting Order S15 SOCA 2005
