Criminal Solicitor In London
One of the best criminal lawyers in London
A solicitor at the cutting edge of serious and organised crime with significant experience defending complex criminal cases:
- Corporate Manslaughter
- Bribery & Corruption
- Money Laundering
- Money Laundering
- Cash Seizures, restraint Orders and Confiscation Proceedings
- Criminal Law
Former international judge who presided in many complex serious and organised crime cases including war crimes, murder, drug trafficking, weapons trafficking, people trafficking, corruption, fraud, money laundering and asset confiscation.
Advising several large law firms in London in serious and organised crime and complex litigation. Having served as an international judge for more than 13 years is able to give strategic advice on how to defend difficult cases.
Recognising that being accused of a serious criminal offence can be a worrying time, will provide constructive, strategic and supportive advice throughout the process in order to achieve the best outcome.
We are seeing a significant increase in the number of tax-related offences, fraud and money laundering prosecutions.
The Fraud Act 2006 (the Act) came into force on 15 January 2007 and applies in England, Wales and Northern Ireland. Section 1 creates a general offence of fraud and introduces three ways of committing it set out in Sections 2, 3 and 4. These are fraud by false representation (Section 2), fraud by failure to disclose information when there is a legal duty to do so (Section 3) and fraud by abuse of position (Section 4). In each case the defendant’s conduct must be dishonest; his/her intention must be to make a gain; or cause a loss or the risk of a loss to another. No gain or loss needs actually to have been made. The maximum sentence is 10 years’ imprisonment.
Fraud by false representation (Section 2)
The ingredients of the offence are that the defendant: (1) made a false representation, (2) dishonestly, (3) knowing that the representation was or might be untrue or misleading and (4) with intent to make a gain for himself or another, to cause loss to another or to expose another to risk of loss. The offence is entirely focused on the conduct of the defendant.
Fraud by failing to disclose information (Section 3)
The ingredients of the offence are that the defendant: (1) failed to disclose information to another person, (2) when he was under a legal duty to disclose that information and (3) dishonestly intending, by that failure, to make a gain or cause a loss.
Like Section 2 (and Section 4) this offence is entirely offender focussed. It is complete as soon as the Defendant fails to disclose information, provided he was under a legal duty to do so, and that it was done with the necessary dishonest intent. It differs from the deception offences in that it is immaterial whether or not any one is deceived or any property actually gained or lost.
Fraud by abuse of position (Section 4)
The ingredients of the offence are that the defendant: (1) occupies a position in which he was expected to safeguard, or not to act against, the financial interests of another person, (2) abused that position, (3) dishonestly and (4) intending by that abuse to make a gain/cause a loss. The abuse may consist of an omission rather than an act.
Like the other two Section 1 offences, Section 4 is entirely offender focused. It is complete once the Defendant carries out the act that is the abuse of his position. It is immaterial whether or not he is successful in his enterprise and whether or not any gain or loss is actually made.
As with all the Section 1 offences, though there need be no consequences to the offending, the existence and extent of those consequences will be very material to sentence, compensation and confiscation. It will still therefore be necessary to gather that evidence. In many instances it is the fact of the gain or loss that will prove the Defendant’s dishonesty beyond reasonable doubt.
Possession of articles for use in fraud (Section 6)
The ingredients of the offence are that the defendant: (1) had possession or control of (2) an article (3) for use in the course of or in connection with any fraud. The wording draws on Section 25 of the Theft Act 1968. The proof required is that the Defendant had the article for the purpose or with the intention that it be used in the course of or in connection with an offence.
Making or supplying articles for use in frauds (Section 7)
The ingredients of the offence are that the defendant: (1) makes, adapts, supplies or offers to supply any article, (2) for use in the course of or in connection with fraud, (3) knowing that it is designed or adapted for use in the course of or in connection with fraud (Section 7 (1) (a)) or (4) intending it to be used to commit or assist in the commission of fraud (Section 7 (1) (b).
“Knowledge” in Section 7 (1) (a) is a strict mens rea requirement. The House of Lords in Montila  UKHL 50 said: “A person may have reasonable grounds to suspect that property is one thing (A) when in fact it is something different (B). But that is not so when the question is what a person knows. A person cannot know that something is A when in fact it is B. The proposition that a person knows that something is A is based on the premise that it is true that it is A. The fact that the property is A provides the starting point. Then there is the question whether the person knows that the property is A.”
Participation by sole trader in fraudulent business (Section 9)
Section 9 makes it an offence for a person knowingly to be a party to the carrying on of a fraudulent business where the business is not carried on by a company. The offence parallels the offence of fraudulent trading in section 458 of the Companies Act 1985.
Non-corporate traders covered by the new offence include sole traders, partnerships, trusts and companies registered overseas.
A defendant may commit an offence under Section 9 (2) (b) in the following ways: (1) knowingly being party to the carrying on of a company’s business, (2) with intent to defraud creditors of any person or (3) for any other fraudulent purpose.
The phrase “to defraud creditors of any person” covers the situation where creditors are creditors of the business, but the business is not a legal person. The creditors could be creditors of individuals or of other related companies.
The term “fraudulent purpose” connotes an intention to go “beyond the bounds of what ordinary decent people engaged in business would regard as honest” R v Grantham  1Q.B. 675; 79 Cr App.R.86.CA; or “involving, according to the current notions of fair trading among commercial men, real moral blame” Re Patrick & Lyon Ltd  Ch. 786, Ch D, per Maugham J. at p.790
Obtaining services dishonestly (Section 11)
The ingredients of the offence are that the defendant: (1) obtains for himself or another, (2) services, (3) dishonestly, (4) knowing the services are made available on the basis that payment has been, is being or will be made for or in respect of them or that they might be; and (5) avoids or intends to avoid payment in full or in part. The defendant must have the necessary intention at the time that the service is obtained (section 11 (2) (c)).
Liability of company officers for offences by company (Section 12)
This section repeats the effect of Section 18 of the Theft Act 1968. It provides that company officers who are party to the commission of an offence by the company will be liable to be charged with the offence as well as the company.
The Elements of the Offences
Section 2 (2) defines the meaning of “false” and Section 2 (3) defines the meaning of “representation”.
A “representation” means any representation as to fact or law, including a representation as to the state of mind of the person making the representation or any other person (Section 2 (3)). An example of the latter might be where a defendant claims that a third party intends to carry out a certain course of action perhaps to make a will in someone’s favour. It may be difficult to prove to the necessary standard that the Defendant knew the state of mind of a third party, but easier to prove that he knew what it might be.
A representation may be express or implied (Section 2 (4)). It can be stated in words or communicated by conduct. There is no limitation on the way in which the representation may be expressed.
A representation can be made by omission, for example, by omitting to mention previous convictions or County Court Judgements on an application form.
An offence may be completed when the defendant fails to correct a false impression after a change in circumstances from the original representation (if the representation may be regarded as a continuing series of representations).
A representation can be made to a machine (Section 2 (5)), for example, where a person enters a number into a CHIP and PIN machine or a bank ATM; or gives false credit card details to the voice activated software on a telephone line; or gives false credit card details to a supermarket website to obtain groceries.
Evidence is necessary to prove that the defendant communicated the false representation to a person or to a machine. It is not relevant whether the false representation is believed or has any affect on any other person.
In some cases it will not be necessary to call evidence from a victim, but prosecutors should bear in mind that a victim who is not named on an indictment or in a TIC cannot be compensated.
Untrue or misleading
A representation is defined as “false” if it is untrue or misleading and the person making it knows that it is, or might be, untrue or misleading. Actual knowledge that the representation might be untrue is required not awareness of a risk that it might be untrue.
The Supreme Court decision in Ivey v Genting Casinos  has resulted in a landmark change to the law of dishonesty, overturning the two-part test in the seminal case of R v Ghosh  which required the Court to consider:
- Whether the conduct complained of was dishonest by the lay objective standard of ordinary reasonable and honest people (the objective test); if yes,
- Whether the accused must have realised that ordinary honest people would regard his behaviour as dishonest (the subjective test).
The Court decided the second limb of the test (subjective test) propounded in Ghosh did not correctly represent the law and directions based upon it ought no longer to be given by Judges to Juries. The fact-finding tribunal must now ascertain (subjectively) the actual state of the individual’s knowledge or belief as to the facts and then determine whether his conduct was honest or dishonest by the (objective) standards of ordinary decent people. As such, there is no longer a requirement that the defendant must appreciate that what he has done is, by those standards, dishonest.
Gain or loss
“Gain “and “loss” are defined in section 5 of the Act. The definition is essentially the same as in Section 34 of the Theft Act.
Gain and loss extends only to gain and loss in money or other property (Section 5 (2) (a)), whether temporary or permanent (Section 5 (2) (b)) and means any property whether real or personal including things in action and other intangible property (Section 5 (2) (b)).
“Gain” includes a gain by keeping what one has, as well as a gain by getting what one does not have (Section 5 (3)).
“Loss” includes a loss by not getting what one might get as well as a loss by parting with what one has (Section 5 (4)).
The Defendant must intend to make the gain or cause the loss by means of the false representation.
The breadth of conduct to which Section 2 applies is much wider than the old Theft Act deception offences because no gain or loss need actually be made. It is the Defendant’s ultimate intention that matters. If the Defendant gets information by making a false representation, intending ultimately to make a gain or cause a loss within the meaning of Section 5 by doing so, he will have committed a Section 2 offence.
Failure to disclose information
There is no requirement that the failure to disclose must relate to “material” or “relevant “information, nor is there any de minimis provision. If a Defendant disclosed 90% of what he was under a legal duty to disclose but failed to disclose the (possibly unimportant) remaining 10%, the actus reus of the offence could be complete. Under such circumstances the Defendant would have to rely on the absence of dishonesty. Such cases can be prosecuted under the Act if the public interest requires it, though such cases will be unusual.
It is no defence that the Defendant was ignorant of the existence of the duty, neither is it a defence in itself to claim inadvertence or incompetence. In that respect, the offence is one of strict liability. The defence must rely on an absence of dishonesty and the burden, of course, lies with the prosecutor.
Prosecutors must be acutely aware of the public interest in such cases, bear in mind the relative standing of the parties and pay particular regard to any explanation for the failure given by the Defendant.
We act for many high-net-worth individuals who are currently the subject of HMRC investigations include fraud and moneylaundering. We have an enviable success rate representing clients charged with serious offences. Whether you are charged with tax-related offences, fraud, money laundering or Cash Seizures, restraint Orders and Confiscation Proceedings contact us for an initial free consultation.
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Malcolm Simmons, Top Criminal Lawyer, Criminal Defence Solicitor representing clients across the UK.
Highly regarded criminal defence solicitor and former international judge, specialising in complex economic crime. He has for many years defended clients