Category: Fraud

Many different types of activities can be characterised as a type of fraud. Having a good understanding of how the law interprets these actions as fraud is crucial to keeping out of hot water and having your finances in order.

Embezzlement is one type of fraud and those guilty of embezzlement can hefty fines and prison sentences. But what is embezzlement, and how does it tie into fraud in the UK? DBT & Partner’s fraud specialist solicitors have all of the information you could need on embezzlement, including

• What is embezzlement?
• What are the most common forms of embezzlement?
• What is the difference between embezzlement and theft?
• How is embezzlement proven?
• What are the penalties for embezzlement?
• Speak to an expert at DBT & Partners today

What is Embezzlement?

Embezzlement is the term used to describe an illegal activity that is characterised as financial fraud. More specifically, embezzlement is when a person takes money or assets that were lawfully attained but used in a manner that goes against the original intention.

Most often, the person will have been entrusted with the assets. They will have then gone on to use them for a different purpose, often to acquire more assets without anyone else or any relevant businesses or companies knowing,

However, for a crime to be investigated and categorised as embezzlement, three benchmarks must be met:

1. The person accused must have been entrusted with the assets or money that belonged to another person or company.
2. There must be an identifiable intent to take ownership of the assets.
3. The person accused must have used the assets, or have provable intention, to their benefit.

What Are The Most Common Forms of Embezzlement?

There are many different types of embezzlement, from falsifying overtime records to Ponzi schemes. Some of the most common types of embezzlement include:

Payroll Embezzlement

Payroll embezzlement is a type of embezzlement that involves a company or employee using the payroll system to commit illegal acts. This is usually seen as claiming wages on an employee that does not exist or no longer works there.

Falsifying Overtime Records

This type of embezzlement is often seen in workplaces where the amount of time a person has worked is submitted, rather than automatically tracked. For example, an employee may ask a manager to add some extra hours onto their shift that they haven’t worked, or an overtime manager who adds another shift onto their timesheet.

Ponzi Scheme

This type of embezzlement is often seen among financial advisors or financial planners who guarantee a strong investment return to a person. They then keep the assets for investment instead of investing them.

Charity Embezzlement

Charity embezzlement is a type of embezzlement committed by those involved in charities, such as volunteers, employees, and upper management. It’s often seen as taking charity money for themselves or using people’s financial information for their purchases.

Cheque Kiting

Embezzlement which is categorised as cheque kiting involves a kiter making deposits and withdrawals of assets across many banks. This type of embezzlement takes advantage of the time it takes a cheque to be registered with a bank, and it is very difficult to determine if this type of embezzlement has taken place.

What Is The Difference Between Embezzlement and Theft?

Whilst it is a form of theft, embezzlement is characterised as stealing assets from someone who trusted the assets with the person committing the crime. This is the key difference between embezzlement and theft, as there must have been a relationship or a sense of trust between the accused and the victim. Whether this is an employee and employer or a carer and the vulnerable person.

How Is Embezzlement Proven?

Proving that you have been a victim of embezzlement can be a difficult task. Firstly, the claimant must be able to prove that the accused had a fiduciary responsibility.

Secondly, the claimant must then be able to prove that the accused then acquired the embezzled assets through this relationship. The actions must also be proven to be intentional and throughout the activity, the accused must have taken ownership of the asset/s at one point or another.

What Are The Penalties For Embezzlement?

If all of the above factors can be proven to be true, then the accused may face an embezzlement charge. They can then be held either civilly or criminally charged and held for embezzlement. From here, a hefty fine can be issued, along with community orders and prison sentences.

Speak To An Expert At DBT & Partners Today

Overall, embezzlement is a serious, yet complex type of fraud that can cause severe distress for everyone involved. To get the best possible outcome, get in touch with the DBT & Partner’s expert team of solicitors to make the process smoother and the result as favourable as possible.

Fraud is a complicated and serious crime in the UK, and a lot of information has to be taken into consideration before any criminal investigation can commence and charges brought.

What is fraud by false representation is a question DBT & Partners are often asked, and with fraud by false representation sentencing guidelines being strictly enforced, it’s important to have a good understanding to begin with.

Having professionals steer you in the right direction and providing you with expert advice and support is essential to navigating the complexities of fraud by false representation allegations and cases.

Need a clearer insight in the meantime? Our expert team will be breaking down fraud by false representation in this article through the following:

• What is Fraud by False Representation?
• What Actions are Considered Fraud by False Representation?
• What Happens in a Fraud by False Representation Investigation?
• Can You Go to Prison for Fraud by False Representation?
• What are the Sentencing Guidelines for Fraud By False Representation?
• Does Fraud by False Representation Stay on a Criminal Record?
• How Can DBT & Partners Fraud Solicitors Help?

What is Fraud by False Representation?

The Fraud Act of 2006 defines fraud as a criminal offence in the UK and has three main definitions of how fraud can be committed, including fraud by false representation, under Section 2 of the Act.

It can be tricky to fully understand how fraud by false representation is defined, especially with the ambiguity of the crime itself. However, to make it more straightforward, the offence of fraud by false representation has been broken down to highlight exactly how it falls under the Fraud Act of 2006.

What Actions are Considered Fraud by False Representation?

There are several clear actions that are considered to be fraud by false representation. If you’re facing an allegation of fraud by false representation, the alleged offender must have made a dishonest false representation by at least one of the following:

• Being aware that the representation is or could be untrue or misleading
• Acting to make a gain for themselves with or without causing or risking a loss to somebody else – regardless of a gain or loss occurred

Examples of these types of actions include:

• Attempting to sell an item that doesn’t belong to you
• Being dishonest about the quality or state of an item
• Using identification that isn’t yours
• Lying on forms to gain an advantage

If the courts find that either or both of these aspects are true, the allegation of fraud by false representation may be upheld. However, the investigation into these aspects and the surrounding context isn’t always straightforward.

What Happens in a Fraud by False Representation Investigation?

Fraud by false representation investigations are often long and drawn-out processes involving interviews and a requirement to understand your business and personal affairs

This is why it is important to have an expert team of legal representatives supporting you. DBT & Partner’s expert team have broken down what you can expect out of fraud by false representation investigation.

From the beginning of fraud by false representation allegation, the police must gather evidence of you acting dishonestly on purpose.

Once you’ve been identified and accused, the evidence gathered such as business and financial documents, videos and photos, personal belongings, and interviews will be put together to be considered by the CPS or any other prosecuting agency to consider whether there is sufficient evidence to commence criminal proceedings.

Understandably, this process is unsettling and worrying, so relying on your expert team for support and guidance will make this investigation easier to digest.

We highly suggest having DBT & Partner’s legal support throughout this process, but especially for police interviews.

Fraud allegations often mean intrusive questions that are difficult to answer to incriminate you, so our experts will be able to advise you through this to avoid any further issues.

Restraint orders are also a possibility throughout a fraud by false representation investigations, in which your assets are frozen whilst you await the outcome of the investigation and future criminal proceedings.

Once the investigation is complete, the police may decide to lay charges and pass the case to the courts, in which you’ll receive a date for your hearing.

Can You Go to Prison for Fraud by False Representation?

You can go to prison for fraud by false representation as the courts take the offence very seriously and can impose a custodial sentence if you are found guilty.

As a result, you must have expert fraud lawyers to support you and your family, not just for the technical and legal assistance but also for the peace of mind that you and your loved ones deserve throughout this difficult time.

What Are The Sentencing Guidelines For Fraud By False Representation?

Fraud is considered to be a serious crime in the UK, and if you are found to be guilty of fraud by false representation you are likely to face a custodial sentence.

As a result, the maximum sentence you may receive can be upwards of 10 years imprisonment along with a fine. However, these types of sentences are usually only seen in the most serious of cases, and minor charges are often handled at a Magistrates Court as a summary case.

The UK’s fraud sentencing guidelines specifically highlight the damages that fraud can have on the victims and the wider community, along with the economy. This kind of harm to such a wide group of people and systems is what makes a fraud by false representation case so serious.

Does Fraud by False Representation Stay on a Criminal Record?

If you’re found guilty of fraud by false representation and you’re convicted, this will stay on your criminal record.

The amount of time it stays on your criminal record will depend on the type and length of your sentence.

How Can DBT & Partners Fraud Solicitors Help?

DBT & Partners have an expert team of fraud solicitors ready to advise and guide you if you are facing a fraud by false representation charge. Having our support from the beginning is key to reducing the impact of stress on you and your loved ones – along with utilising the skilled and tactical approaches our team implements. They also handle any issues that arise during the investigation, including Confiscation and Restraint Orders.

Fraud by false representation is one of the most common types of fraud, so our team is well equipped in ensuring you have a competent fraud lawyer who is passionate about securing you the best outcome.

Speak To An Expert At DBT & Partners Today

Get in touch with DBT & Partners expert team of solicitors to make the fraud by false representation investigation process smoother. They’re there to support you and give you all the information you need to ensure that you get the right advice and help that’s unique to your case; so you have the best defence possible.

For a business to thrive, it needs to steer clear of any type of tax fraud, especially carousel fraud. If HMRC tax authorities can demonstrate that your trade was linked to fraudulent activity, huge penalties and fines will follow.

One of the many types of fraud that business owners and accounts departments should be vigilant of is carousel fraud, also known as VAT missing trader fraud, or missing trader intra-community (MTIC) fraud.

This type of fraud, in short, is the theft of value-added taxes (VAT) from a government by organised criminal gangs who take advantage of the way this tax is managed in cross-border trading (such as the European Union), where the movement of goods between jurisdictions is VAT-free.

What are the red flags for detecting VAT carousel fraud?

So, how can a business avoid inadvertently being involved in carousel fraud? The following are some of the red flags to spot when dealing with companies or individuals outside of your organisation. While not exhaustive, they should give you an idea of the factors that could point to suspicious activity:

• Businesses that have been newly established or recently incorporated and have no financial or trading history.
• Your contacts have no real knowledge of the market or product they propose to be trading in.
• Spontaneous invitations from organisations offering an easy profit on high-value/volume deals for no apparent risk.
• Payment instructions to a third party or an offshore account.Sole traders who have a history of selling wholesale “high value, low volume” trade such as mobile phones or parts for computers.
• Unsecured loads with suspicious interest rates and terms.
• Instructions to pay less than the full price to the supplier.
• Established companies who have recently been taken over by new owners despite having no experience in the industry.
• Businesses that sell goods from residential addresses serviced offices and short-term lease accommodation.

How can I protect my business against VAT carousel fraud?

By conducting Due Diligence and Know Your Customer checks, you can significantly reduce your chances of involvement with businesses carrying out carousel fraud.

Make sure that the following procedures are also routine in your business:

• Knowing your customers, services, and suppliers
• Have a clear idea where the foods or services you are offered come from a legitimate source
• Have a good understanding that the deal is genuine.
• Check that the goods or services you buy are as described
• Check the integrity of your customers and suppliers
• Check the commercial viability of the transaction

If you’ve been inadvertently involved in carousel and VAT fraud, or missing trader intra-community fraud – then you will need to seek legal help immediately. Contact our Business & Tax solicitors team for full support and advice.