Defend Fraud Charges
Our Experience
In 2020, the Firm represented a client accused of defrauding his employer in the case of R. v. S.G. [2020]. It was alleged that the employee had developed a sophisticated plan to defraud the employer by creating a fake company and using the fake company and fake invoices to funnel money away from the employer. In total, the alleged loss was over $52,000 USD. The accused, erroneously believing he would be forgiven, confessed, and apologised for what he had done. The company subsequently called the police and had him arrested and charged with fraud over $5,000. The Firm engaged in lengthy negotiations with the Crown, providing mitigating evidence, and resolved the matter without a criminal record.
In 2013, the Firm represented a client who attempted to defraud the Royal Bank of Canada in R. v. A.N. [2013]. The client was reported to law enforcement after allegedly attempting to cash a fraudulent bank draft valued at $56,000. Fraud prevention staff at the bank flagged the suspicious activity, froze the client’s bank accounts, and reported the matter to law enforcement. The Firm presented evidence to the Crown to show that the client was unaware that the funds were stolen and therefore lacked the necessary intent to be convicted. As a result, the Firm secured a withdrawal.
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Fraud offences have become common across Canada in recent years. This is in part, due to advances in technology that make various types of fraud easier to commit. Fraud offences can arise in a wide variety of situations and in some cases specific victims are targeted. Donich Law has experience defending an array of fraud offences including workplace fraud, retail fraud rings, insurance fraud, and various online scams.
Workplace fraud occurs when an employee defrauds their employer. This can happen in a number of ways and involves the employee abusing their position in the company for personal gain. An employee is placed in a position of trust and authority by their employer. Breaching this trust is seen is an aggravating factor by the courts. Aggravating factors will factor into a more severe sentence should the accused be convicted.
In 2022, the Firm represented a client accused of attempting to cash a fraudulent money order in R. v. R.A. [2022]. The client was charged with fraud over $5,000, identity theft, possession, sale, etc., of identity documents and utter forged document. The client was arrested and charged with fraud over $5,000 after attending a cheque cashing institution with a fake ID and attempting to cash a $40,000 money order. As a second time offender, the Crown initially sought a period of incarceration due to the high value of the fraud and the accused’s prior history. The Firm participated in lengthy negotiations with the Crown, ultimately securing a withdrawal of the three most serious charges.
Punishments for Fraud Depend on the Value of the Property
In 2015, the Firm represented a Home Sense employee accused of participating in a sophisticated fraud ring targeting his employer in R. v. S.C. [2015]. The client was reported to law enforcement along with two co-accused after loss prevention staff discovered the scheme. Loss prevention staff utilized surveillance footage from the store as well as of the perpetrators license plate number. The information was provided to police who used it to track down client and co-accused and execute a search warrant on their house. The Firm carefully analysed the evidence in the possession of the Crown, discovering various issues which were ultimately used to resolve the matter without a criminal record.
In addition to representing individuals accused of defrauding their employer, Donich Law also has experience defending individuals engaged in a variety of other fraudulent activity including online fraud and bank fraud. We regularly obtain favourable results for our clients, often resolving matters without a criminal record.
Fraud offences are more than just an annoyance faced by the residents of Ajax, Pickering, and Cobourg. They can have serious consequences for victims and are difficult for police to investigate and solve. To that point, the 2021 Annual Report from the Cobourg Police Service found that there were 84 reports of fraud that year. Of the 82 that were founded, only 36 were solved. In that same year, the Durham Regional Police released a report that shows 3324 reported frauds, and a three-year average of 3580. In response to these rates and the difficulties presented by fraud, both the CPS and the DRPS have developed materials designed to educate residents of their municipalities on fraud and the best prevention strategies.
How to Defend Fraud Under $5000
In 2018, the Firm represented a client accused of participating in a sophisticated, international fraud scheme in R. v. Z.U. [2018]. The accused was alleged to have been money laundering the proceeds of fraud committed in the United States. Law enforcement alleged that money had been stolen from senior citizens in the U.S. and then transferred into Gold Bullion to be transferred over the border into Canada. While law enforcement had some evidence implicating the client, the Firm was able to poke holes in the Crown’s case by uncovering various issues. Ultimately the Firm secured a stay on nine fraud charges.
In 2015, the Firm represented a client charged with several fraud offences after allegedly participating in a theft and fraud ring targeting Target and Staples stores in R. v. K.L. [2015]. The accused was alleged to have developed a plan to steal items from various stores and return the stolen product for a cash refund. The Firm exploited several procedural issues with the Crown’s case, including unavailable witnesses and secured a withdrawal of eight of the fraud charges.
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Frequently Asked Questions
What are Aggravating and Mitigating Factors and How do They Apply to Fraud?
Aggravating and mitigating factors are facts that impact the type of sentence an offender will receive after being convicted for fraud. These factors can provide context to the act of committing an offence and are presented to a judge by both the Crown and defence counsel. Both types of factors are usually present in any one case. The presence of aggravating factors in a scenario suggest that an offender should receive a stronger sentence, whereas mitigating factors imply that a more lenient punishment.
Section 380.1(1) of the Criminal Code sets out specific aggravating factors that apply in cases of fraud. They include: the complexity and duration of the fraud scheme; any potential impact on the public market and the Canadian economy; the number of victims, their vulnerability, and the severity of the impact that the fraud had on them; if the victim was the offender’s employer; the destruction of records related to the fraud; the value of the fraud if it exceeds $1 million and others. Mitigating factors can include, a person’s age, their previous criminal record, their expression of remorse and attempts at rehabilitation, and their position and reputation in the community, if it was not relevant to how the offence was committed.
What are the Rights on Arrest for Someone Charged with Fraud?
Everyone in Ajax, Pickering, and Cobourg, as well as the rest of Canada has the same rights made available to them when they are arrested for any type of criminal offence. These rights are protected under s. 10 of the Canadian Charter of Rights and Freedoms. They include being informed of the reason for arrest, specifically the information will include the specific allegations and the true jeopardy or scope of the offence, who the complainant is, and when the offence is alleged to have occurred. This right ensures people are aware of the consequences they face upon arrest.
A person subject to arrest or attention also has the right to counsel. This right allows an accused to speak to a lawyer, such as our counsel in Ajax, Pickering, or Cobourg, about their rights and how to exercise them before they are questioned by law enforcement. The right may also be triggered again if the circumstances of the arrest change dramatically, like if a person is charged with an additional offence. Finally, a third right allows for an accused to challenge the legal validity of their detention.
What if the Fraud is a First Offence in Cobourg?
If an offender commits fraud as contained in s. 380(1) of the Criminal Code, and that is their first criminal offence, that fact will play into the sentence they receive. Appropriate sentences are determined by a judge after defence counsel and the Crown make submissions on the appropriate punishment. These submissions focus on what are known as aggravating and mitigating factors and are specific to the personal circumstances of the offender.
Aggravating factors are presented by the Crown and are facts that suggest a stronger punishment is needed. They may include but are not limited to the complexity and duration of the fraud scheme, the value of the fraud, the number of the victims or if the offender abused a relationship of trust in committing the offence. Mitigating factors can be used by the defence to argue for lesser punishments and may include an offender’s expression of remorse and attempts at rehabilitation, as well as the person’s lack of criminal record. Defence counsel can argue that a young first-time offender has made a mistake that will not be repeated in making a case for leniency. Older first-time offenders can rely on a lifetime of abiding the law to demonstrate that strict punishments are not needed. In the end, though a first offence can be a strong mitigating factor, the resulting sentence will balance all applicable aggravating and mitigating factors while considering the principles of sentencing.
What Should Someone Do if They Believe they are the Victim of Fraud?
If someone believes they are the victim of fraud, it is important that they gather as much information as they can about the offence. Fraud offences are very difficult for the police to investigate and for the Crown to prove in court. As such, any information a victim can provide makes the process that much easier. Any information that the victim has may be very case-specific and depends on the kind of fraud they were victimized by, but it may be common for the victim to have access to bank records that show a history of fraudulent transactions. The victim may also in some cases have a record of contact with the offender, including text or message and phone call logs. If the victim can give a package with this and other relevant information in their possession that is organized in a timeline to the police, that is the best thing they can do to help prosecute a fraud.
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Recent Cases
R. v. Wapoose, 2020 ONSC 6983
The Ontario Superior Court of Justice case of R. v. Wapoose dealt with an aboriginal offender convicted of fraud over $5,000. The offender served on the board of directors of an aboriginal health clinic as a treasurer, which allowed them to defraud the clinic in the approximate amount of $1 million. The scheme involved them receiving consulting fees they were not entitled to and signed fraudulent cheques for other board members engaged in similar fraud. The losses stemming from the fraud and an investigation prompted the clinic to sell off assets and negatively affected the quality of service it could provide.
Due to their status an aboriginal offender, a report was provided that gave light to the offender’s circumstances as it relates to the historical and cultural factors that tie into the offender’s identity and the relationship between the Canadian legal system and aboriginal peoples. Of note here were several factors that adversely impacted the offender’s life, as well as significant health problems that required special treatment. Considering this reality, the judge balanced the circumstances of the offender with the serious nature of the conduct and the need to denounce it. As a result, the offender was given a one year conditional sentence, ordered to attend counselling and a financial literacy course, and was also ordered to pay restitution to the victim in the amount of almost $60,000.
R. v. Suzi, 2018 ABPC 130
The Provincial Court of Alberta case of R. v. Suzi demonstrates the different kinds of dishonest conduct that can result in a conviction for fraud. Specifically, the Code contains the wording, “other fraudulent means” as part of the wording for fraud. Here, the offender victimized a friend who had lived with them. The victim had moved out and left some of their possessions behind, including a blank cheque. The offender forged a cheque, made it out to cash in the amount of $380 and tried to deposit it at the bank. The fraud was ultimately unsuccessful because there were insufficient funds in the offenders account, but an offence had still been committed.
The elements of a fraud offence that must be proven require the offender engaged in a dishonest act and that those actions led to a loss or risk of loss for the victim. To this point, the judge stated, “I am satisfied on the whole of the evidence that the actus reus of fraud has been proven beyond a reasonable doubt. Mr. Suzi engaged in an act of deceit by going through Ms. MacFayden’s personal belongings, taking possession of a cheque that he was not authorized to possess, and then attempting to cash the same without any authority to do so. This was an act of “dishonesty” as defined by the Supreme Court in Olan and Theroux. “Deprivation” has also been established beyond a reasonable doubt given the obvious “risk of prejudice to the economic interests of the victim…” [at paras 25-26]
R. v. Scribnock, 2017 CanLII 13988
The Ontario Superior Court of Justice case of R. v. Scribnock is an example of a case of high value fraud over $1 million that carries a minimum punishment of two years imprisonment as set out in s. 380(1.1) of the Code. In this case the offender was convicted for 19 counts of fraud over $5,000 and sentenced to seven years imprisonment. They were also ordered to pay $2,871,963.30 in restitution as part of a larger forfeiture order and prevented from ever holding authority over someone’s money or property as a volunteer or employee.
The offender was a financial advisor who was highly regarded in their community. The victims were also friends of the offender who placed a great deal of trust in them. These are aggravating factors that accounted for the lengthy sentence issued. The rationale for this decision was summarized by the judge, “This was an egregious fraud where friendships of many years were taken advantage of, where a position of high trust was abused to the financial devastation of several honest hard-working citizens who earned the right to a comfortable decent retirement.” [at para 18]
R. v. Jacobs, 2022 BCPC 230
The Provincial Court of British Columbia case of R. v. Jacobs is another example of fraud sentencing in the context of aboriginal offenders. Here, the offender was a leader of their nation who defrauded it out of over $885,000 meant for the nation’s most vulnerable residents. The offender took advantage of their position and the fact that there was little oversight to commit the fraud. A sentence was issued for four years imprisonment and a restitution order matching the value of the fraud.
As mentioned above, both the seriousness of the offence and the personal and cultural circumstances of the offender must be evaluated in determining sentencing. However, given the severity of the conduct, there is little mitigation to be done in cases such as this. The judge clarified to that effect, “I note that in Gladue, the Court observed that “…the more violent and serious the offence, the more likely it is a practical reality that the terms of imprisonment for aboriginals and non-aboriginals will be close to each other or the same …” [at para 85]
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About the Author
Jordan Donich
Jordan Donich has been a Lawyer for over 10 years and is a trusted legal analyst by Canadian Media. He is as a leader in Canada’s tech sector for lawyers and developer of Law Newbie. Jordan is a Black Belt with the Japan Karate Association and trained in Krav Maga. He won a Gold Medal at 2004 Canadian National Championships and was published in the National Newspaper Awards.
Jordan has been featured in Forbes and is a member of DMZ Angels in Toronto.