Financial Crimes Lawyers
What to do if you have been charged with fraud or a financial crime
Anyone who has been accused of a financial crime should hire a criminal lawyer as soon as possible. A conviction for fraud or a financial crime will likely result in a permanent criminal record. For professionals, this can lead to losing your licence, and it will cause anyone problems seeking a job in the future. A fraud conviction can also lead to travel restrictions.
Financial crimes are usually complicated and often involve large amounts of financial records. Often times, the accused person’s defence depends on financial records as well. It is important for someone accused of a financial crime to hire a lawyer immediately so that the defence can be planned from the beginning, and financial records can be obtained before they become lost or unavailable.
Our firm has a lot of experience defending fraud and financial crimes across Ontario. We know how to craft a defence to these charges, to find and preserve the evidence needed to back it up, and to marshal that evidence in court to provide the best defence possible to the charge. We also use our experience in the court system to successfully negotiate withdrawals and other resolutions to many charges before they ever get to trial. Sometimes, trials can’t be avoided, and in that case having a lawyer with a proven track record in Court is the most important thing you can do to help your case. You need a lawyer who can persuasively tell your story and present your defence through cross-examination, by preparing you to testify, and by using the law and the facts to persuasively argue your defence in closing submissions.
If you have been charged with a financial crime or believe that you might be, contact us using the form on this web page immediately for a free consultation about your case.
What is fraud?
In everyday life, most people have some understanding of what fraud means: if you lie to someone and trick them into giving you money, you’ve committed fraud. While this is true, the criminal definition of fraud is somewhat more complicated than this simpler understanding, and it applies to more conduct than people sometimes believe.
Fraud is defined by section 380(1) of the Criminal Code. Someone commits fraud when by “deceit, falsehood or other fraudulent means” they defraud any person or the public of “property, money, valuable security, or any service.”
In practice, the courts have held that there are two elements to fraud:
- The dishonest act; and
In order for there to be fraud, there has to be a dishonest act. This can be a straightforward lie (i.e. deceit or falsehood), but the courts understand dishonest acts more broadly than this. Any “fraudulent means” used by an accused person will count as a dishonest act. The courts have held that the question is essentially objective: would a reasonable person believe what the accused did was dishonest?
As specific examples, the following conduct could be viewed as a dishonest act:
- Failing to disclose material facts in a commercial transaction when you are under a duty to disclose
- Using corporate funds for personal purposes
- Breaching a fiduciary duty for your own benefit or the benefit of a third party;
- Exploiting another person’s weakness
The second element of fraud is the deprivation. A dishonest act alone is not enough – and it has to be proven that the accused’s dishonesty actually defrauded the public or any person. However, causing someone a “deprivation” isn’t restricted simply to costing them money. The courts have held that deprivation can be proven by showing detriment, prejudice, or even the risk of prejudice to someone’s economic interests. This means that the victim of a fraud doesn’t actually have to lose money – the risk of loss is sufficient. In other words, if someone lies to a person about their experience as an investor and the returns someone can expect if they give them some of their money to invest, that person can be guilty of fraud even if the misled investor doesn’t actually lose a penny.
Fines and restitutions for financial crimes
Under s. 462.37(3) of the Criminal Code, the Court has the power to order a fine that matches the value of property that has been obtained as a result of a fraud or financial crime. An accused person’s inability to pay the fine is not a justification to avoid imposing a fine. When a fine like this is imposed (called a “fine in lieu of forfeiture”), the Court must set a deadline for payment of the fine (e.g. within 5 years). If the fine is not paid in that time, the Criminal Code sets out mandatory periods of jailtime that must follow. If a fine is set between $500,000 and $1,000,000 and it is not paid, for example, the Criminal Code provides that a judge must set a penalty of between 3 and 5 years in jail. It is possible for an accused who hasn’t paid a fine to resist going to jail at a court hearing, or to apply for an extension of time to pay the fine.
Section 738 of the Criminal Code empowers the Court to impose an order for restitution either on application by the Crown Attorney, or on its own motion. When an order for restitution is imposed, the Court must impose a deadline for payment. If the deadline is not met, the restitution order essentially converts into a civil judgment against the accused. A restitution order survives bankruptcy.
What is the punishment for being found guilty of fraud?
There is a wide range of possible sentences for fraud. The maximum penalty for a fraud worth more than $5,000 is 14 years in jail. If a fraud is worth over $1,000,000, the Criminal Code sets out that there is a two year mandatory minimum jail sentence. For cases that don’t have a mandatory minimum jail sentence, it is possible to receive a non-jail sentence like house arrest. For more information non the possible punishment for fraud, see our article on sentencing in fraud cases.
Other financial crimes
Fraud is probably the most common “financial crime” that is charged. However, there are a number of other financial crimes set out in the Criminal Code that can be charged separately, or that can be paired with a charge of fraud:
Set out in section 362 of the Criminal Code, false pretence applies when someone makes a “representation” about a matter of fact that they know is false, and that they make with “a fraudulent intention” to “induce” someone to act on that false statement.
Breach of trust:
Section 336 of the Criminal Code makes it an offence for a trustee of someone else’s money or property to convert or take that property or money with an intent to defraud. This charge applies to people like administrators of estates, lawyers, and bankruptcy trustees who often hold money or other valuables on behalf of other people (like creditors, clients or beneficiaries).
The Criminal Code makes it a crime to make (s. 449), possess (s. 450) or use counterfeit money (s. 452). These offences apply to those who buy counterfeit money or bring it in to Canada as well. As for using counterfeit money, many people have had the experience of holding a bill they think might not be real, or trying to spend cash only to have the cashier tell them the bill is a fake. Normally, someone will only be guilty of using counterfeit money if they know the money is counterfeited.
Section 366 of the Criminal Code makes it a crime for anyone to make a false document with the intention that it should be used or acted on as genuine, or that a person should be induced to do something on the belief that is genuine.
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