Fraud and Theft - Case Study Example

Fraud and Theft Number Department Fraud and Theft Scenario In the first scenario Sebastian’s regular business trips to foreign countries is the main cause of the tort. His employer buys business class tickets for his travel prior to such journeys, but instead of traveling on the tickets, he sells them through an online auction site and uses the money to purchase the cheaper economy class tickets. This leaves him with the remaining cash for his own use per trip. The primary issues are: whether Sebastian’s sale of the business class ticket and its replacement by a cheaper one for his own financial benefit amounts to a fraud. Johnson and Rogers (2007) note that Section 16 of the Theft Act 1968 provides that an individual who is found culpable of using deception to unfairly obtain money for himself or on behalf of another party shall be held guilty of the offense. In addition, upon their conviction they shall be imprisoned for a maximum of five years. The Sebastian’s actions violate this provision. In addition, under the Theft Act 1978, Section 2, Sebastian is guilty of committing fraud by false representation since he has made a clear, express indication to his company that he would travel on business class tickets, and then later on the he capitalises on this untrue and misleading statements to obtain money unfairly (Dripps, 2013). Under Section 4 of the Act, Sebastian is guilty of deception by abuse of office; the provision defines this act as one that involves an individual who is in a situation where he or she is expected to protect the pecuniary interests of another party, but exploits that position to his or her advantage. The law lowers the bar on such cases to cover cases where the tort is a result of an omission. In this case, Sebastian was under the obligation to safeguard the pecuniary interests of his company by travelling on economy class ticket, but failed to do so. Scenario 2 In the second scenario, Sebastian cannot afford to buy toys for his children, so he heads to the company storeroom stocked with enough stationary to cater for the needs of all 500 employees in his premises and takes photocopier paper and coloured marker pens meant for sales presentations to his children at home. The primary issue in this case is whether Sebastian’s conduct amounts to theft. In Section 1(1) of the Theft Act 1968, an individual is culpable of theft if their actions lead to an unfair appropriation of property owned by another with the objective of permanently denying the owner of it. The Act goes further under Sections 2-6 to impose a maximum of seven years of imprisonment for individuals who have been found culpable of the offense. Sebastian’s conduct in this case meets the legal thresholds set for his conviction in the sense that: a) he had appropriated; b) the property (marker pens and paper); c) belonging to his employer to his children.   The Theft Act 1968 under section 3(1) defines appropriation as any act that alters the rights of a property owner in favour of the defendant or those who they are working for. In light of this, appropriation includes property acquired by innocent means. This way, the law lowers the bar for the application of appropriation in the sense that any minimal denial of property rights to the owner is deemed as sufficient. In the case of R v Morris, Anderton v Burnside [1983] 3 WLR 697, switching of price tags in a supermarket was found to constitute adequate denial of the property right to the owner (Molan and Molan, 2005). In the unified case, Morris was apprehended after buying certain items from a supermarket at a lower value; while Burnside’s arrest came before he could make payments for the items. The House of Lords was faced with the question of whether an appropriation required the usurpation of all of the rights of the property, and if granted; when an appropriation would be deemed to have occurred. In light of the House of Lords decision that appropriation did happen at the point of exchanging the price tags, Sebastian’s actions meet the appropriation provision at the point of taking the items from the store. The second condition requires a property must be taken by the defendant if theft is to be successfully proved in court. According to Elliott (2004), Section 4(1) of the Theft Act 1968 defines property as inclusive of finances and real or personal items, including things held in trust and other items other than confidential information. Therefore, the coloured marker pens and photocopier papers stolen by Sebastian constitute property. In the case of R v Velumyl [1989] Crim LR 299, the appellant was a director of a company who had been charged with theft for taking money from the organization’s safe. He alleged that he planned to return the money the following week. The court upheld his conviction on the premise that he did not intend to return the same notes and coins into the safe as claimed; that his true intention was to permanently deny the organization of the finances taken (Johnson and Rogers, 2007). A possible argument by Sebastian that he intended to return the stationery would be countered by the fact that by taking the company assets to his children, any reasonable person could not foresee a situation whereby the items would remain in their original status for their return to the owner. Lastly, Section 5(1) of the Theft Act 1968 defines property owner as anybody who possesses or has control of the item (Elliott, 2004). By virtue of the stationery belonging to Sebastian’s employer and intended for use in presentation by the sales team, the items did not belong to Sebastian. In light of these three tests, Sebastian is culpable of theft of the stationery and could serve up to 7 years in prison. Scenario 3 In the third scenario, Sebastian is provided the opportunity to sign a contract for the supply of new laptop computers to his floor. He then uses the opportunity to alter the contract form to send to his wife one of the employer’s laptops as a birthday gift. The fact that he does not intend to use it at any point in time invalidates the job nexus that he could use to justify that the item’s possession. The primary issues in this case are whether Sebastian’s actions amount to: a) dishonesty, and fraud by: b) abuse of position; c) false representation. Under Sections 2 and of the Fraud Act 1978 which has been incorporated into the Fraud Act 2006, Sebastian’s actions are illegal and meet the thresholds for the conduct of a dishonest person whom upon conviction should serve up to 7 years in jail either singly in addition to reasonable damages to the employer. Dishonesty Dishonesty is not codified in law because the practice is unique to cases. Despite the lack of statutory provisions defining the conduct of a dishonest person, the case of R v Ghosh [1982] QB 1053, provides the much needed precedent on the mater (Molan and Molan, 2005). The twofold test given in the ruling seeks to interrogate whether the behaviour of an individual in question was consistent with the conduct of a reasonable person, and; whether, the person was aware that a reasonable person would perceive his behaviour as dishonest. In this case, Sebastian’s behaviour of re-channelling part of his employer’s supplies to his home is dishonest in any reasonable person’s eyes. The search and arrest which the police carried on him in the unforgiving cold weather without an apparent probable cause raising any curiosity to his alleged criminal conduct raises important questions in law as to whether the evidence which the officers obtained in his oral confession of the crime would weather the exclusionary rule seeking inadmissibility of bad evidence collected through suspect mishandling (Dripps, 2013). Probable cause and Reasonable Cause Police officers must not carry out any searches and seizure of property or arrests of criminal suspects without valid warrants (Dine, Gobert, and Wilson, 2010). Otherwise any evidence collected in the process would be inadmissible during the trial under the exclusionary rule. The only exception to search and arrest without a warrant is when the police are convinced that there is a reasonable suspicion or probable cause that crime has been committed by the suspect(s), and any inaction by the police could aid the suspect’s escape. But, his barrage of confessions suggests to an individual who is suspected of committing a crime. As such his, earlier statements would suffice, in the event that independent investigations establish that the earlier statements were true. In the case of R v King [1979] CLR 279, the defendant agreed that the mileage on a truck he was seeking to sell might be inaccurate (Dine, Gobert and Wilson, 2010). But along the judicial process, he claimed ignorance of the odometer readings, leading the court to convict him for deception after the court had established that the defendant had actually interfered with the odometer and his earlier statement was true. References Dine, J., Gobert, J., and Wilson, W. 2010. Cases and Materials on Criminal Law. Oxford: Oxford University Press. Dripps, D.A. 2013. "Dearest property": digital evidence and the history of private "papers" as special objects of search and seizure. Journal of Criminal Law & Criminology, 103(1), pp.49-109. Elliott, C. 2004. Theft Act 1978, s. 1: Meaning of services. Journal of Criminal Law, 68(4), pp.282-285. Johnson, M., and Rogers, K.M. 2007. The Fraud Act 2006: The E-Crime Prosecutors Champion or the Creator of a New Inchoate Offence? International Review of Law, Computers & Technology. 21(3), pp.295-304. Molan, M.T., and Molan, M. 2005. Cases & Materials on Criminal Law. London: Psychology Press. Read More