What Counts as Fraud in Canada? Understanding Canada's Law

From conducting phone scams on older Canadians in order to take their money or swindling investors of their life savings for the "next best business investment", fraud is a very serious offence. The act generally involves convincing someone to give up their belongings through misrepresentation of what the money is going to be used for or flat out lying to these people for personal gain.

The individuals who commit fraud will need an experienced fraud defence lawyer in their corner. Continue reading to learn about fraud, what Canada's law says about it, and how an experienced lawyer will help you through the mess.

What Counts as Fraud in Canada?

In the Criminal Code of Canada, fraud is defined as deliberately depriving someone of their belongings (property, money, services, etc.) through deceit or misrepresentation of their true intention. It is technically theft, but in a fraud case, the theft occurs because the victim gave their money, property, or services up willingly. Fraud crimes may include:

• Altering price tags
• Tax evasion
• Identity theft
• Bank fraud
• Embezzlement
• Insurance fraud
• Forgery
• Purgery

To be charged with fraud, the Crown Prosecutor must be able to prove beyond a reasonable doubt that:

• You stole something from someone fraudulently
• The complainant is the owner of the item 
• The deprivation was intentional and under false pretenses

The Crown Prosecutor must also prove that you were the individual involved in the fraud. They also must provide the data regarding when (date and time) and where (location) the fraudulent activity occurred. 

Your fraud defence lawyer will be able to explain the criminal components that break down the charge of Fraud in Canada and will do whatever it takes to get you through this tough time. 

Explaining Canada's Criminal Code

Fraud laws in Canada are relatively self-explanatory. The penalties for fraudulent activity depends on the:

• Value of the offence
• Sophistication of planning
• Breach in trust
• Number of people involved
• Type of people swindled
• Offender's criminal history

Aggravating circumstances enforce a harsher penalty for fraudulent activity. 

According to Section 380 of the Criminal Code of Canada, anyone who commits fraud is guilty of an indictable offence and is subject to a prison term of no more than fourteen years when the offence amounts to more than $5,000. Those guilty of offences of an amount less than $5,000 are indictable and subject to a prison term of up to two years.

Section 380.1 covers aggravating circumstances and defines them as follows:

• A significant degree of or complexity is involved in planning the fraud
• The fraudulent act affects the Canadian economy or financial market adversely
• The act affects a large number of people and had a huge impact on these individuals due to their finances, age, or health. 
• The offender wasn't qualified or licensed to take these actions (but pretended to)
• The offender destroyed or concealed evidence of the fraudulent act

Alternative Measures Programs may available for first-time offences that are minor in nature. The steps in these programs may include:

• Compensating for losses and damages
• Giving an apology to the victim(s)
• Performing community service

It allows offenders to make show intention of making amendings and acknowledging their wrongdoing and can be used to work towards a more favorable resolution.

Fraud Cases in Canada

There are several well-known cases of fraud in Canada's history. 

The most notable being the Sorenson and Brost Ponzi Scheme—the biggest Ponzi scheme that Canada has ever seen. Sorenson and Brost tricked more than 3,000 investors into investing more money into a gold refinement business for a 35% increase in their payout. However, this "gold refinement business" didn't exist. 

The older investors were "paid" with the funds from newer investors to make it seem like their investment was working out in their favour. Eventually, the scheme fell apart and these investors were left with nothing after investing their entire savings into the fraudster's pockets. In the end, they only served two years of their twelve-year sentence. 

The Livent Scandal occurred when Livent Entertainment of Canada, Inc. defrauded their stockholders by "cooking the books". The company's auditors were also sued in the amount of $84.8 million because they didn't prevent the fraud from happening in the first place. 

Brian Molony embezzled money from his place of employment (the Canadian Imperial Bank of Commerce so that he could satisfy his gambling habit. When he was arrested in 1982, Caesars Casino was also sued because it turns out they knew that the money that Brian was using to gamble wasn't his.

The largest accounting scandal of Bernie Ebbers' time occurred when he, a Canadian businessman, used falsified documents to inflate the company's assets and revenue value. He made between $3.8 billion and $11 billion in accounting fraud. He is still serving time in the U.S. for this event.

The owner of the Toronto Maple Leafs and the Maple Leaf Gardens, Harold Ballard, was arrested in the 1970’s following a conviction of 47 counts of theft, fraud, and tax evasion. He used Maple Leaf Gardens’ funds for his personal expenses, including limo services for his daughter. He served three years of the nine years on his prison sentence.

Looking for an Experienced Fraud Lawyer in Richmond Hill?

It is possible to create a defence for your case if you have the right fraud lawyer on your side. What The Law has a team of criminal defence lawyers committed to giving our clients legal representation or the highest quality. We are experienced in handling fraud cases and are fully prepared to take on any case you may become involved in.

Contact What The Law today to get the representation that you deserve for your criminal defence.