While government figures show a decrease in serious fraud, it’s as important as ever to know exactly what to do should your business ever come under scrutiny.
A number of high profile investigations have recently taken place, making it clear that allegations of fraud can be damaging to a person and a company.
If you find yourself or someone connected to your business becoming the subject of an investigation, it would be wise to take appropriate action immediately – and having the right legal expertise is essential.
First4lawyers can provide the knowledge you need to help protect your rights and your business. Get in contact online or by phone.
What is serious fraud?
Fraud is defined as dishonest actions that result in potential or actual financial loss to any person or entity. This includes theft of money or property, either by employees or people who don’t work for the company, by means of deception.
Serious (or complex) fraud is defined using a number of criteria:
- Nature and cost – Have a large number of people been affected by the offence? Has there been significant impact on the victims of the fraud?
- Scale – Is the crime likely to undermine public confidence in the integrity of the UK’s financial markets?
- Financial, factual, or legal complexity – Is the investigation beyond the means of most other law enforcement agencies?
- Nature of the public interest – This usually relates to alleged fraud involving public officials. This is considered to be in the public interest as it could undermine public confidence in the government.
What are the different types of fraud?
There are many different kinds of serious fraud. These include:
- Asset stripping – This involves taking company funds or valuable assets and leaving behind debts.
- Fraudulent trading – This occurs when a company does business with the intention of defrauding creditors or customers for fraudulent purposes.
- Share ramping – Also referred to as 'book ramping' and ‘pump and dump’. This involves influencing the share price of a company for one’s own profit.
- Publishing false information – This involves creating, destroying, concealing or falsifying accounts, report or records with the intention to mislead people about the company's financial position.
- Corporate corruption – This could involve offering bribes to individuals, agencies, or institutions in order to win a contract.
What are the penalties for serious fraud?
The Fraud Act 2006 states that those making and/or supplying articles for fraudulent means, and those conspiring to defraud face both a fine and up to ten years in prison. Those obtaining services through dishonest means or who possess articles for use in frauds will be punished with up to five years in prison and/or a fine.
Corporate offenders convicted of fraud will receive sentences in line with the ten-step process defined by the UK Sentencing Council, which came into effect on 1st October 2014.
I am under investigation for serious fraud – what should I do?
You should start by seeking the advice of solicitors who specialise in fraud cases. Here at First4lawyers, the solicitors we work with can be put on cases alleging anything from tax evasion, to money laundering and multi-million pound fraud, through to boiler room operations and investment fraud.
If your business is subject to allegations of fraud, you should know that our highly experienced serious fraud lawyers have the expertise to defend you. Just get in touch.