Revise Fraud as defined in the Fraud Act 2006 for Cambridge 9084 (2.2.8)

The Fraud Act 2006 simplified the law by creating a single, general offence of fraud under Section 1. This offence can be committed in one of three ways: by false representation (s.2), by failing to disclose information (s.3), or by abuse of position (s.4). While the actus reus (the guilty act) differs for each of the three methods, the mens rea (the guilty mind) has two core elements common to all. Firstly, the defendant must be dishonest. The test for dishonesty is the objective test established in Ivey v Genting Casinos (UK) Ltd [2017]. Secondly, the defendant must act with the intention of making a gain for themselves or another, or causing a loss (or risk of loss) to another. These common mens rea elements are the foundation for any fraud prosecution.

This is the most common form of fraud. The actus reus is simply making a false representation. A 'representation' can be about fact, law, or a person's state of mind (s.2(3)), and it can be express or implied. For example, wearing a specific uniform implies you hold a certain position (R v Barnard). Similarly, ordering a meal in a restaurant implies an intention to pay for it (DPP v Ray), and using a credit card implies you have the authority to use it (R v Lambie). A representation is 'false' if it is untrue or misleading (s.2(2)). The Act also makes clear in s.2(5) that a representation can be made to a machine, such as an ATM or a website. The offence is complete when the representation is made; it is not necessary to prove that anyone was deceived by it or that any loss or gain occurred. The mens rea requires that the defendant knew the representation was, or might be, untrue or misleading, in addition to the core mens rea of dishonesty and intent to gain or cause loss.

This type of fraud covers situations where a defendant remains silent when they have a legal duty to disclose information. The actus reus is the failure to disclose. The crucial element here is the existence of a 'legal duty'. The Fraud Act does not define this, but it can arise from various sources, such as statute (e.g., company law), a contract of utmost good faith (like an insurance proposal), a fiduciary relationship (e.g., solicitor and client), or the custom of a particular trade. In R v Razoq, a doctor was convicted under s.3 for failing to disclose to a new employer that he was under investigation by his previous employer's General Medical Council. This established that such a professional duty to be honest on an application can constitute a 'legal duty'. The mens rea is the standard dishonest intention to make a gain or cause a loss by failing to disclose the information.

This section targets defendants who misuse a privileged position of trust. The actus reus requires the defendant to occupy a position in which they are expected to safeguard, or not act against, the financial interests of another person, and to have abused that position. The 'position' can be formal, like a trustee or company director, or informal, where a relationship of trust has developed. In R v Valujevs, the Supreme Court confirmed that the nature of the 'position' is a matter of fact for the jury and is not limited to established fiduciary roles. 'Abuse' can be an act or an omission. For example, an employee who uses company client lists for their own private business would be abusing their position. In R v Marshall, a care home manager was found to have abused her position by taking and using the remaining credit on residents' phone cards after they had died. The mens rea is, again, that the abuse was dishonest and done with the intention of making a gain or causing a loss.