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Typical Private Prosecutions by Companies

Typical Private Prosecutions by Companies against others – even their own directors or employees


 

Fraud Act Prosecutions

The first crimes to consider are those under the Fraud Act 2006.
These are very powerful indeed when sentencing after a criminal conviction as can result in a sentence of up to 12 months imprisonment in the Magistrates Court and in the Crown Court where most such prosecutions occur, this goes up to 10 years.

 

There are three main types of fraud 

 

        i.            Fraud by false representation 
This is under section 2 of the act and is committed when someone dishonestly makes a false representation, and intends to make a gain by this (or to cause someone else to lose in some way – or even have them risk a loss)

Put simply, a representation is false if is untrue or misleading, and the person making it knows that it is, or even might be, untrue or misleading.

And BTW, a representation is normally the stating of a fact but it can be also about as to what someone thinks.

It is also regarded as made certainly if it is made in email, letter, text etc. or even in a spreadsheet account  

 

      ii.            Fraud by failing to disclose information
Fraud by failing to disclose information is under section 3 and is committed if a person dishonestly fails to disclose information which they are under a legal duty to disclose, and intends, as above ,to cause a gain (or cause a loss).

 

    iii.            Fraud by abuse of position
Fraud by abuse of position is under section 4 and is committed if a person occupies a position in which they are expected to safeguard, or not act against, the financial interests of another person, but dishonestly abuses that position, and intends, by this to make a gain cause loss etc.

As above, this abuse of position can be an omission as well as an act.


Theft Act Prosecutions

Private prosecutions under the Theft Act 1968 not only cover theft, which fairly well understood, but also offences that may be caused by or to companies:

 

        i.            False Accounting
False Accounting comes under section 17 and the sentence is anything up to seven years.
It is committed where a person dishonestly, with a view to gain (or cause a loss) destroys, defaces, conceals or falsifies any account or any record or document made for accounting.

It is also committed if, when furnishing information for any purpose, produces or makes use of any account, or record or document which they know is or may be misleading, false or deceptive in a material particular.

As above, this can be where that person omits or agrees to omit a material particular from an account.

 

      ii.            Liability of Company Officers for offences by the Company
This comes under s.18 Theft Act 1968 where directors etc. can be liable for certain offences made by their company with up to seven years imprisonment.

An example is where false accounting is committed by a company and then is proved to have been committed with the consent or connivance of a director, manager, secretary etc.

 

    iii.            False Statements by a company directors False Statements by a company director comes under section 19 Theft Act 1968 and again can lead to seven years imprisonment.
The offence is where a director has an intent to deceive shareholders about the affairs of the company or publishes a written statement or account which they know is (or may be) misleading, false or deceptive.

 

    iv.            Theft
This brings us to Theft, which most people believe they are familiar with, but even this basic offence has several elements which need to be present to be proved.
Section 1 says a person is guilty of theft if they dishonestly appropriate property belonging to another with the intention of permanently depriving the other of it. 

So, the act has to be:
  • Dishonest and not e.g. by mistake.
  • They must actually take the property.
  • The property must belong to another.
  • The intention must be to take away permanently and not e.g. to borrow.

For a company, the offence may be committed by an employee if they take home company property.