Fraud is one of the most widely misunderstood offences in the criminal law. Ormerod described it as “the general offence of lying,” because the offence is much broader in the United Kingdom than it is in Canada. It is still the content of the law, however, to criminalize such serious lies that they deprive their victims of property.
Section 380 of the Criminal Code of Canada defines fraud as:
“…deceit, falsehood or other fraudulent means, whether or not it is a false pretense within the meaning of this Act, defrauds the public or any person, whether ascertained or not, of any property, money or valuable security or any service.”
This means that dishonesty and falsehood are both elements of the crime, and so is the damage to the victim. The result of actually defrauding the victim must be achieved for fraud to apply, unless the Crown is proceeding under the doctrine of attempts.
It is a defence, therefore, to a charge of fraud to say that whatever falsehood being alleged is actually true. It is also a defence to say that although the alleged falsehood was untrue, it was not deceitful on the part of the accused, who honestly believed it at the time.
In the leading case on this matter, the Newfoundland Court of Appeal ruled that “deceit” requires the accused to actually know the statement is false, and incite the victim to rely on it. A “falsehood” must be a deliberate lie, and “dishonesty” is the age-old test of what a “reasonable person” would consider to be honest or dishonest.
Fraud is a serious offence, and is a “hybrid” offence under the Criminal Code. This means the Crown will be able to elect whether to proceed with a summary trial or whether to proceed on indictment. On indictment, the maximum sentence of two years, except in cases involving securities fraud, where the maximum punishment is fourteen years.
If you or someone you know is charged with fraud, it is prudent to consult with a lawyer. Your lawyer can advise you of your rights if you are ordered to surrender to the police. They can obtain disclosure of the Crown’s case, and they can advocate for you throughout the trial process.