The word “fraud” evolved from the Latin word “fraus,” which was defined as criminal deception. Merriam-Webster defines fraud as “intentional perversion of truth in order to induce another to part with something of value or to surrender a legal right.” Given that there are numerous ways to “pervert the truth,” there is a broad range of different types of fraud.

What is a Fraud Charge Under Canadian Law?

With so many possible means to engage in fraud, Canada’s Criminal Code provides a broad-based description of potentially fraudulent activity. This allows for a greater degree of prosecutorial discretion in pursuing fraud charges. Section 380(1) of the Criminal Code describes fraud as having two specific elements: 1) a prohibited act of “deceit, falsehood or other fraudulent means;” and 2) that this act deprives the public or specific person of “any property, money or valuable security, or any service.”

Ensuing sections of the Code, along with legal precedents set by court cases, establish “intent” as a crucial component of fraud charges. This means that intent needs to be proved in order to secure a conviction. This also means that people can be charged for their intention to conduct fraud, even if unsuccessful.

Penalties for fraud if convicted under Section 380 depend upon the value of the property involved. Offences involving property valued at less than $5,000 can lead to a maximum prison sentence of two years. Property values greater than $5,000 can result in a maximum prison sentence of up to 14 years. If the property value exceeds $1 million, the minimum sentence is two years imprisonment. In determining penalties, courts consider a number of aggravating factors listed by the Criminal Code. Judges may also consider mitigating factors, such as attempts at restitution, remorse, and absence of a criminal record.

Some fraud types can also be addressed by other sections of the Criminal Code or by other legislation. For example, credit card fraud charges are often brought under Section 342, which covers credit card theft and fraud. Most Tax fraud is typically handled under Section 239 of Canada’s Income Tax Act.

Fraud cases in criminal law tend to be very complicated. When combined with the monetary complexities inherent in many financial transactions, most people charged face stiff challenges in mounting a successful defence. Thus, anyone facing fraud charges in Canada should always seek out the services of a highly competent fraud lawyer.

What Are the Different Types of Fraud?

One might be tempted to say that the number of fraud types is only limited by the ability of people to come up with new ways to pervert the truth. But this is only partially true because new means of fraud also arise with the emergence of new business tools. Thirty or so years ago the various types of check fraud were far more predominant than the few types of internet fraud that started to emerge with that new technology. Today, the number of internet fraud types far surpasses that of check fraud. New and emerging technologies also lead to a merging of fraud types. For example, credit card fraud can also be a form of internet fraud and vice versa.

Describing all of the most common types of fraud is a tall order, but here is a rundown of some of the more common types of business fraud:

Tax Fraud

Unlike most fraud types, prosecution of tax fraud is typically conducted under the auspices of Section 239 of Canada’s Income Tax Act. Tax fraud includes the willful deception in writing or by statement for the purposes of evading tax payment or falsely claiming refunds and/or credits not due. In addition to prison sentences of up to five years, penalties can include extensive fines.

Mortgage Fraud

Mortgage fraud typically involves the deliberate misrepresentation of information for the purposes of obtaining financing that otherwise would not have been granted. There are a variety of mortgage fraud types, but all generally involve deception regarding assets and/or income. Some common forms of mortgage fraud include:

  • Purposely providing misleading information about income sources and work details.
  • Failing to disclose other mortgages or debts.
  • Inflating property values by purposely omitting detrimental property information.
  • Using false purchaser names on mortgage applications.
  • Acting as or using a “straw buyer” with credit to deceptively secure a mortgage.
  • Falsely claiming a rented property is owner-occupied.

Medical Fraud

Medical fraud is considered prevalent world-wide and primarily involves offenders who make false claims and/or produce fake receipts in order to secure unearned medical benefits from insurers. In 2018, the Canadian Life and Health Insurance Association estimated that fraudulent claims account for between two to 10 percent of total private insurer claims in Canada. That equals between $600 million to $3.4 billion per year. Medical fraud charges are usually brought up under Section 380 of the Criminal Code.

Insurance Fraud

Like medical fraud, insurance fraud is widespread. While medical fraud is often a type of insurance fraud, any type of insurance is subject to potential fraud. Knowingly lying on an insurance application or claim can lead to fraud charges, as can any attempt to deceptively claim damages. Charges relating to insurance fraud are generally laid under Section 380 of the Code.

Credit Card Fraud

Most cases of credit card fraud are addressed under Section 342 of the Criminal Code. Charges can be brought for anyone knowingly possessing, using, or selling a credit card(s) that has been forged or altered. People can also be charged with fraud for using a credit card with the knowledge that it has been revoked or cancelled. Penalties for fraud covered under this section of the Code can result in a maximum penalty of 10 years in prison.

Identity Theft Fraud

Most everyone knows that incidents of identity theft have skyrocketed across Canada in the past decade. Section 403 of the Criminal Code provides a fairly definitive description of identity theft under the law. Identity theft fraud basically includes anyone who “fraudulently personates another person, living or dead, with intent:”

  1. To advantage themselves or others
  2. Obtain any property or property interest
  3. Cause disadvantage or harm to the person being impersonated or others
  4. To avoid arrest, prosecution or otherwise obstruct justice.

Such fraud isn’t limited to using a person’s identifying information but can also involve the act of pretending to be another person in conjunction with the above.

Internet Fraud

Internet fraud is so wide encompassing that fraud-related charges are liable to be laid under several different sections of the Criminal Code. Because internet fraud often involves credit cards and/or unauthorized use of a computer, charges can be laid under Section 342. Charges might also be laid in relation to Section 403 covering identity theft. And, because such fraud often intrudes on privacy, Section 184 might also might be involved. In short, internet fraud-related charges can prove especially complex and call for the expertise of an experienced fraud lawyer.

By |2021-02-02T14:28:37+00:00January 15th, 2021|Fraud|
Criminal Lawyers Association
Toronnto Lawyers Association
Law Society of Ontario
Criminal Lawyers Association
Toronnto Lawyers Association
Law Society of Ontario

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Thanks Igor for all your help throughout my criminal process. I have never been charged before and I think Igor really helped ease my nerves through the entire process. When I was initially charged I called a couple of other firms but I ended up retaining Igor because when we spoke on the phone he spent a lot of time to explain what I was charged with and what it all means, I felt the most comfortable when talking to him. As my case progressed, he really took the time to explain my options and the probability of each one, so I really appreciated that and I felt less confused with all the various legal proceedings.
My son was charged with DUI and I hired Igor to represent his matter. Overall, my experience with Igor was great and my son felt really comfortable working with Igor as well. As a parent, I was really concerned about the entire process and even though my son is considered an adult, I was extremely involved the entire time. I really liked that Igor respected my concerns as a worried parent and always ensured any meetings or conversations were held with me present as much as possible, if I wasn’t available to attend a meeting and only him and my son were able to meet, Igor would reach out to update me. I would most definitely recommend Igor to others.
He is caring, honest, and highly knowledgeable in his field. I was charged with domestic assault a few months ago, I was initially with another lawyer but got fed up with the unresponsiveness (didn’t answer my calls or emails), I decided to look for someone else. Igor came highly recommended from a friend and I’m glad I went with him. He knows his stuff and fought hard for my case. Compared to other lawyers I’ve dealt with, day and night.
I cannot recommend Igor Vilkhov enough. I was charged with possession and trafficking, I was going through a tough time in my life at the time and I am glad I was able to find a lawyer who is genuinely passionate about what he does. I was kept consistently updated throughout the entire process and I couldn’t believe the positive outcome. While reviewing my case, he located a significant error on the part of the police. I can honestly say that his work is meticulous and his ability to negotiate is something else. If you are looking for a quality criminal defence lawyer, I can’t say enough good things about Igor.

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