What are the Consequences of Fraud?
Fraud is a criminal offence conducted through dishonest practice with the intention to gain a benefit for the fraudster. Accordingly, the consequences for fraud offences are taken seriously and implemented rigorously. The administered consequences increase in relation to the offence which has been committed. Severe fraudulent crimes can be subject to harsh repercussions, such as long-term prison sentences, which are in alignment with the UK Fraud Act 2006. Therefore, understanding of the UK Fraud Act 2006 is of the utmost importance.
What are the different penalties which could be enacted?
In the UK, if it has been decided that an individual is guilty of a certain type of fraud, then there is more than one consequence that they could potentially face:
1) They could be issued with a caution. Therefore, this is the cautionary measure.
During the interview stage in which an individual is being accused of fraud, if that individual admits to the fraudulent offence and co-operates with the relevant body that is interviewing them, then they might be issued with a cautionary warning.
This warning will be decided and issued by the relevant council, as it has been their decision not to pursue this fraudulent offence through a court. This caution, because it is conducted by a council and the Department for Work and Pensions, is not on the same level as a police warning, and it leaves no criminal record. However, the warning is recorded on the UK national database.
Cautionary warnings are only administered to fraudulent offences which are lower down the risk spectrum.
2) Administrative Penalty
This is a fixed penalty administered by the relative council and takes the form of a fine. The fine is decided in relation to the benefit overpayment from the offence, and therefore the fine is either 30% of the payment or 50% of the payment. This fine is expected to be paid in addition to the benefit overpayment from the offence, so it can be a costly sum in the end.
This penalty is decided upon as the appropriate course of action to take by the council, instead of referring the offence to prosecution. If the individual refuses to pay this fine or cannot pay this fine, then prosecuting the individual will be taken into consideration.
For the most severe fraudulent offences, prosecution will be chosen as the necessary consequence. Usually the prosecution process will take place at the magistrates' court, but the most serious cases will be heard at a Crown Court. These cases will be publicised in order to name and shame those who have committed fraud, in the hope that these examples will deter individuals from committing fraud such as this in the future.
How does the UK Fraud Act 2006 treat the consequences of fraud?
The UK Fraud Act establishes the consequences which can be related to a fraudulent offence section by section, setting the premise that each offence is dealt with differently. It does establish that one of the most severe consequences is a 10 year imprisonment. Therefore, the UK Fraud Act has re-defined the consequences which had been established in the previous legislation, the Theft Act of 1968, which was vague.
In July 2018 the year-long case at Liverpool Crown Court came to an end as David Barton Senior, 64, was sentenced to five counts of fraud, three counts of theft, false accounting and the transfer of criminal property. Barton had for eighteen years committed fraud and theft to the disadvantage of elderly victims in Barton Park Nursing Home, Southport. Eventually, Barton's fraudulent and corrupt activity was discovered when he attempted to claim the right to £10 million worth from the estate of an elderly resident following her death. Therefore, he was found guilty of dishonesty following his years of stealing from elderly residents. Liverpool Crown Court decided to imprison Barton for twenty-one years and Rosemary Booth, the care home manager, has been imprisoned for six years on three counts of conspiracy to defraud due to her involvement in Barton's activities. Liverpool Crown Court's sentencing here is intense as it has dealt with a severe case of fraud.
The consequences of fraud increase in relation to the severity of the offence and thus individuals and organisations should ensure all of their conduct is fair and ethical, to avoid any repercussions.