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Fraud offences

The term ‘fraud’ encompasses a wide range of dishonest conduct which can constitute an offence under Queensland law as well as under Commonwealth law.  Like some other offences, fraud runs the gamut of seriousness from low level charges through to serious allegations attracting heavy jail sentences.

Colin Townes, the Principal solicitor & Director of Townes & Associates, has special experience in fraud cases having worked for several years as a prosecutor specialising in Centrelink and Tax fraud and having written a research project exploring the topic in order to obtain his Masters degree in law.  If you or a loved one has been charged with fraud, you should contact Colin for a confidential cost and obligation free discussion about the situation and how Townes & Associates can help. 

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    Fraud 

    Queensland Criminal Code, Commonwealth Criminal Code

    Fraud offences in Queensland fall into two categories; ‘aggravated fraud’ and ‘non-aggravated fraud’ and they are also split into two levels of seriousness under Commonwealth law.  While there are some technical differences between ‘state’ and ‘federal’ fraud the most significant distinction between the two is who the offence is alleged to have been committed against.  If the complainant is a Commonwealth government department (for example Centrelink or the Australian Tax Office) then a federal charge will be laid.  If the complainant is an ordinary person, or business, in Queensland then a state charge will normally be laid.

    At their least serious, fraud offences carry a maximum penalty of 12 months imprisonment (this is the penalty for the least serious federal fraud charge) with a maximum penalty of 20 years imprisonment applying to the most serious cases (aggravated fraud under the Queensland Criminal Code).

    Convictions for fraud offences can have wide ranging consequences, for example being barred from managing companies or prevented from living in many countries in the world in addition to the lengthy jail sentences that are routinely imposed in the most serious cases.

    If you would like to know more about fraud in Queensland select an offence below for more information.

    Fraud offences in Queensland

    Select an offence from the tabs below for more information including the maximum penalty, common case examples and practical tips. Use the form at the bottom of this page, or the email link above, to get in touch if you have been charged with any of these offences.

    A charge laid under s.408C(1) of the Queensland Criminal Code, fraud is committed when a person dishonestly does any of the 9 things referred to in that provision but most commonly when they gain a benefit, or cause a loss, to another (whether another person or a business entity).  The maximum penalty for fraud in Queensland is 5 years imprisonment with a criminal conviction.

    If you would like more information about fraud, use the tabs below to assist you.

    Using a stolen credit card

    A person comes into possession of a credit card which has earlier been stolen from its owner.  Before the card is cancelled this person uses it to buy an $85 bottle of liquor from a bottleshop.  Assuming this person is a first offender they should expect to receive a fine either with or without a conviction being recorded.   

    The mistaken bank deposit

    A person notices that somebody has incorrectly deposited the sum of $4,800 into their bank account.  They know it is a mistaken deposit because the payment reference which is used clearly suggests it was meant for somebody else. Instead of notifying their bank, this person withdraws the $4,800 in cash. Assuming they are a first offender, this person might expect to receive a Probation or Community Service Order likely with a criminal conviction. 

    Please note these examples and penalties are illustrations only.  Every case is different and if you have been charged with an offence you should contact Townes & Associates for specific advice on your situation.

    A person is not guilty of fraud if their conduct was not dishonest ‘according to the standards of ordinary, honest, people’.  Since 2016 the law in Queensland has removed the need for the Crown to prove that a person knew that their conduct was dishonest according to the standards of ordinary, honest, people so the defence must be made out on an objective basis if it is to succeed.

    Commonly in fraud cases involving businesses there is a defence available under sections 22 or 24 of the Queensland Criminal Code in that the defendant has an honest claim of right over the property which is said to have been defrauded or that they were honestly (and reasonably) mistaken as to their entitlement to said property.

    A charge of fraud will be heard in the Magistrates Court.

    The case of R v Dillon; Ex parte Attorney-General (Qld) [2015] QCA 155 changed, or rather clarified, the definition of dishonesty in relation to s.408C offences.  Dillon makes the relevant test an objective one meaning the Crown need only prove that the subject conduct was dishonest according to the standards of ordinary and honest people and not the additional element that the client also knew (or must have known) it to be dishonest by those standards (as is the case under the Commonwealth regime).

    In R v Orchard [2018] QCA 58 the Court of Appeal affirmed the definition of dishonesty which they arrived at in Dillon.

    While a person cannot remove their criminal liability by repaying a defrauded amount, if a client is able to make a lump sum repayment in satisfaction of all, or close to all, of the loss they caused this can have a significant positive impact on sentence (precisely because it is done so rarely).

    A charge laid under s.408C(1) of the Queensland Criminal Code, aggravated fraud is committed when a person dishonestly does any of the 9 things referred to in that provision but most commonly when they gain a benefit, or cause a loss, to another (whether another person or a business entity).  The maximum penalty for aggravated fraud in Queensland is either 14 or 20 years imprisonment depending on the sum of money (or other property) that is involved.

    Aggravated fraud is only committed where the dishonest conduct referred to above is committed while the person is a director of a corporation (and the corporation is the victim of the fraud), when they are an employee of another person, if they defrauded a trust or if the sum of money or property gained/lost is $30,000. 

    If the total value of the fraud is between $30,000 and $100,000 a maximum penalty of 14 years imprisonment applies. 

    If the total value of the fraud is over $100,000 and/or if the person carries on a business committing fraud, a maximum penalty of 20 years imprisonment applies. 

    If you would like more information about aggravated fraud use the tabs below to assist you.

    Stealing as a servant

    A person is employed as an office manager and book-keeper for a small business and they create false invoices, purportedly from vendors to the business, and direct payment for those invoices to their own personal bank account.  Assuming this person is a first offender and the total loss to the small business was between $30,000 and $50,000 they should expect to receive a penalty in the range of a suspended jail sentence through to a period of perhaps 6-9 months of actual custody.   Experienced legal representation in a case like this is essential because there are often many features in mitigation that ought to be made known to a court (like an addiction or mental health difficulties) which can have a significant impact on the penalty which is ultimately imposed.

    The Ponzi scheme

    A person is the head of syndicate that operates a fake investment scheme in which money is funnelled from new investors to pay interest upon existing investors deposits without any actual business operation being undertaken.  Depending on the scale of the operation and the net loss to the complainant investors, this person could expect to spend between 2 and 8 years (or even longer) inside jail if they are guilty.

    Please note these examples and penalties are illustrations only.  Every case is different and if you have been charged with an offence you should contact Townes & Associates for specific advice on your situation.

    A person is not guilty of fraud (including aggravated fraud) if their conduct was not dishonest ‘according to the standards of ordinary, honest, people’.  Since 2016 the law in Queensland has removed the need for the Crown to prove that a person knew that their conduct was dishonest according to the standards of ordinary, honest, people so the defence must be made out on an objective basis if it is to succeed.

    Commonly in fraud cases involving businesses there is a defence available under sections 22 or 24 of the Queensland Criminal Code in that the defendant has an honest claim of right over the property which is said to have been defrauded or that they were honestly (and reasonably) mistaken as to their entitlement to said property.

    A charge of aggravated fraud will be heard in the District Court.

    The case of R v Dillon; Ex parte Attorney-General (Qld) [2015] QCA 155 changed, or rather clarified, the definition of dishonesty in relation to s.408C offences.  Dillon makes the relevant test an objective one meaning the Crown need only prove that the subject conduct was dishonest according to the standards of ordinary and honest people and not the additional element that the client also knew (or must have known) it to be dishonest by those standards (as is the case under the Commonwealth regime).

    In R v Orchard [2018] QCA 58 the Court of Appeal affirmed the definition of dishonesty which they arrived at in Dillon.

    While a person cannot remove their criminal liability by repaying a defrauded amount, if a client is able to make a lump sum repayment in satisfaction of all, or close to all, of the loss they caused this can have a significant positive impact on sentence (precisely because it is done so rarely).

    A charge laid under s.134.2 of the Commonwealth Criminal Code the most serious federal fraud charge is an offence which is committed when a person dishonestly, and by a deception, obtains a benefit from the Commonwealth (most often Centrelink or the Australia Tax Office).  The maximum penalty for Commonwealth fraud is 10 years imprisonment.

    This most serious charge is most often laid where a person commits Centrelink fraud or Tax fraud to a value exceeding $30-50,000.  This is not a legislated requirement (and the more serious offence can be laid in relation to lesser amounts) but in practice lower value offending will normally be the subject of a lesser, summary, fraud charge.

    Commonwealth charges of fraud are prosecuted by lawyers employed by the Commonwealth Director of Public Prosecutions, rather than the Police or the state Director of Public Prosecutions.

    Centrelink fraud

    A person receives a Newstart from Centrelink and, as a condition of that allowance, they are required to make fortnightly declarations to Centrelink about how much employment income they earn (so that Centrelink can correctly calculate their entitlement each fortnight). Instead of truthfully declaring their income, the person tells Centrelink that they have zero earnings each fortnight when in fact they have earned income.  After an investigation and by applying a particularly complicated rate calculator contained in the Social Security legislation, the person is found to have obtained $85,000 in improper benefits because of their dishonest declarations. This person should expect to serve between 4 and 9 months inside jail before being released on a Commonwealth recognizance in a case like that.

    GST Fraud

    A person is the sole director of a small business which is registered for GST and required to lodge returns each month.  In 3 consecutive months, this director declares in the company’s GST lodgements that the company has made several million dollars worth of ‘non-capital’ purchases and they claim a refund in relation to the GST component of those purchases totalling $250,000. A surprise ATO audit establishes that none of the claimed purchases were actually made and the director is charged with fraud.  Assuming they are a first offender with otherwise good character this person might expect to serve between 2 and 4 years in jail before being released either on parole or a Commonwealth recognizance.

    Please note these examples and penalties are illustrations only.  Every case is different and if you have been charged with an offence you should contact Townes & Associates for specific advice on your situation.

    A person is not guilty of Commonwealth fraud if their conduct was not dishonest according to the standards of ordinary honest people and known by them to be dishonest by those standards.  In practice, this means that the Crown must prove that the person charged had a reasonable basis upon which to suspect that what they were doing was dishonest in order to prove that they are guilty.

    This most serious charge of Commonwealth fraud will be heard in the District Court. 

    A charge laid under s134.2 of the Commonwealth Criminal Code is a federal offence which means that the Crown must prove both a ‘physical’ and a ‘fault’ element for the offence to be made out (except in relation to the status of the complainant as a Commonwealth entity– no fault elements need be proved in relation to that aspect).  Engage with part 2.2 of the Code to come to grips with how Commonwealth offences are constructed.

    In the event that a client is guilty of s.134.2 fraud (or any other commonwealth offence for that matter) it is important to remember that the sentencing provisions contained in the Crimes Act 1914 (Cth) apply rather than the Penalties & Sentences Act 1992 (except for some limited exceptions).  This is particularly important in relation to how conditional releases and parole operate (a ‘suspended sentence’, for example, is a concept unknown to Commonwealth sentencing).

    A charge laid under s.135.2 of the Commonwealth Criminal Code the most serious federal fraud charge is an offence which is committed when a person engages in conduct which causes them to receive a Commonwealth benefit that they know, or believe, they are not entitled to.  The maximum penalty for this category of Commonwealth fraud is 12 months imprisonment.

    This less serious charge is most often laid where a person commits Centrelink fraud or Tax fraud to a value of less than $30-50,000.  This is not a legislated requirement and the more serious offence can be laid even in relation to these lesser amounts, but in practice this is a rarity (and normally reserved for repeat offenders).

    Commonwealth charges of fraud are prosecuted by lawyers employed by the Commonwealth Director of Public Prosecutions, rather than the Police or the state Director of Public Prosecutions, even in the Magistrates court.

    Centrelink fraud

    A person receives a Newstart from Centrelink and, as a condition of that allowance, they are required to make fortnightly declarations to Centrelink about how much employment income they earn (so that Centrelink can correctly calculate their entitlement each fortnight). Instead of truthfully declaring their income, the person tells Centrelink that they have zero earnings each fortnight when in fact they have earned income.  After an investigation and by applying a particularly complicated rate calculator contained in the Social Security legislation, the person is found to have obtained $15,000 in improper benefits because of their dishonest declarations. This person should expect to be released on a Commonwealth recognizance for an operational period of between 18 months and 2 years.

    GST Fraud

    A person is the sole director of a small business which is registered for GST and required to lodge returns each month.  In 3 consecutive months, this director declares in the company’s GST lodgements that the company has made ‘non-capital’ purchases carrying a total of $12,000 GST (which they claim as a refund from the ATO).  A surprise ATO audit establishes that none of the claimed purchases were actually made and the director is charged with fraud.  Assuming they are a first offender with otherwise good character this person might expect to be released on a Commonwealth recognizance for a period of 18 months to 2 years, likely with a component of imprisonment to be served in th event that the recognizance is breached.

    Please note these examples and penalties are illustrations only.  Every case is different and if you have been charged with an offence you should contact Townes & Associates for specific advice on your situation.

    A person is not guilty of a summary offence of Commonwealth fraud if they did not know or believe that they were receiving a benefit from the Commonwealth (that they were not entitled to) as a result of conduct that they engaged in.  This perhaps sounds complicated but, in practice, it normally means that a person has acted in good faith when dealing with a government agency (normally Centrelink) and there is no proof to the contrary.

    This less serious charge of Commonwealth fraud will be heard in the Magistrates Court. 

    A charge laid under s135.2 of the Commonwealth Criminal Code is a federal offence which means that the Crown must prove both a ‘physical’ and a ‘fault’ element for the offence to be made out (except in relation to the status of the complainant as a Commonwealth entity– no fault elements need be proved in relation to that aspect).  Engage with part 2.2 of the Code to come to grips with how Commonwealth offences are constructed.

    It is important to realise that the definition dishonesty which applies to s.134.2 offences (the indicatable Commonwealth offence) does not apply to the summary charge.  The Crown does not have to prove that the conduct was dishonest by the standards of ordinary honest people and known by the defendant to be so dishonest.  Instead, they must prove the element of intention in relation to the conduct (often times the lodging of forms or omission to declare a relevant circumstance) and knowledge of the disentitlement to a benefit.

    In the event that a client is guilty of s.135.2 fraud (or any other commonwealth offence for that matter) it is important to remember that the sentencing provisions contained in the Crimes Act 1914 (Cth) apply rather than the Penalties & Sentences Act 1992 (except for some limited exceptions).  This is particularly important in relation to how conditional releases and parole operate (a ‘suspended sentence’, for example, is a concept unknown to Commonwealth

    Facing charges?

    If you or a loved one has been charged with fraud, you should contact Townes & Associates for a confidential, cost and obligation free discussion about the situation and how we can help.  Use the form below to get in touch, leave your best contact telephone number and we will give you call back at no cost to you.

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