Fraud Offences in New South Wales (Crimes Act 1900, Part 4AA)

In NSW, Fraud offences refer to criminal conduct which causes financial or proprietary harm through dishonesty or deception, and is distinguishable from ordinary offences of theft. Offences of this kind frequently involve calculated dishonesty, abuse of trust, and significant financial harm to individuals, businesses, or government agencies.

Fraud offences carry significant maximum penalties, and are treated seriously by Courts because ‘white-collar crime’ strikes at the integrity of commercial dealings, public administration, and personal trust.

Convictions of fraud may have devastating and long-lasting effects on one’s personal and professional life, because they are offences of dishonesty which directly impugn character, trust, responsibility and fitness to hold certain positions, insurances or visas.

Part 4AA of the Crimes Act 1900 captures both traditional and modern forms of dishonest or deceptive conduct, including online, identity-based, benefit-related, and money laundering offending.

Section 192E — Fraud

The offence of fraud pursuant to s 192E will be established where a person:

• intentionally;
• by deception or dishonestly;
• obtains property belonging to another: see s 192C, or
• obtains a financial advantage or causes a financial disadvantage: see s 192D.

The offence is punishable by imprisonment for up to 10 years.

The provision captures a wide range of misconduct, including indirect benefits, administrative advantages, or financial harm that does not involve a clear transfer of property.

Deception vs Dishonesty

‘Deception’ means any deception, by words or other conduct as to fact or as to law. It must be either intentional or reckless and is not limited to direct lies. It includes false representations, expressed or implied, made by words, conduct, or even silence where there is a duty to speak.

Deception may also arise from a continuing representation, such as allowing a false impression to persist when circumstances change. For example, failing to correct an earlier statement that has become untrue may amount to deception.

Critically, deception does not require an overt or explicit falsehood. Conduct that creates or maintains a misleading impression can be sufficient.

‘Dishonesty’ means ‘dishonest according to the standards of ordinary people and known by the offender to be dishonest according to the standards of ordinary people. It is a question of fact and is assessed as a legal concept, not merely a moral one.

While the offender’s knowledge or belief may be relevant to their intention, the ultimate test for dishonesty is objective.

This distinction is important. Not all unethical or sharp business practices amount to criminal fraud. The law draws a clear line between hard-edged commercial behaviour and conduct that crosses into criminal dishonesty.

Section 192C — Obtaining Property Beloning to Another

The provision captures offending where a person:

1. Obtains ownership, possession or control of the property for himself, herself or for another, or
2. Enables ownership, possession or control of the property to be retained for himself, herself or for another, or
3. Induces a third person to do something that results in the person or another person obtaining or retaining ownership, possession or control of the property

Property belongs to a person if that person has possession or control of the property or, has a proprietary right or interest in the property.

Section 192D — Obtaining Financial Advantage or causing Financial Disadvantage

Section 192D provides for obtaining a financial advantage or causing financial disadvantage. In practice, it is one of the most commonly charged fraud offences in New South Wales and occurs in one of two ways:

‘Obtaining’ a financial advantage for oneself or for another person:

• by inducing a third person to do something that results in oneself or another person obtaining (taking) a financial advantage, and
• keeping that financial advantage, whether permanently or temporarily.

For example, where an employee submits fraudulent invoices to their employer and receives payment.

‘Causing’ a financial disadvantage applies to that same conduct which results in a financial loss for the person. This offence is ordinarily relied upon in online scamming, such as facebook marketplace, where a person accepts payment for goods they do not have to sell, or do not send.

Core Elements of Fraud Offences

To establish a fraud offence under Part 4AA, the prosecution must prove that:

• a deception occurred;
• the deception was dishonest;
• the accused obtained a benefit or caused a financial disadvantage as a result; and
• the accused acted intentionally.

Each element carries a specific legal meaning and has been the subject of judicial interpretation. This article provides a high-level overview only. Detailed analysis of each element will be addressed in later articles in this series.

Penalties for Fraud in NSW

Fraud offences under Part 4AA carry significant maximum penalties. Depending on the provision charged, the maximum penalty may be up to 10 years’ imprisonment.

Courts may impose a range of penalties ranging from:

• Dismissal;
• Fines;
• Conditional Release Orders (‘CRO’) (with or without conviction);
• Community Corrections Orders (‘CCO’)
• Intensive Correction Orders (‘ICO’)

Community-based orders may include other conditions such as supervision, community service work, mandatory treatment and/or rehabilitation etc.

The severity of the sentence to be imposed will depend of factors such as:

• the amount of money involved, or value of the property involved;
• whether the offending occurred in isolation, or over a period of time;
• any breach of trust, or position of authority;
• the nature of any planning and/or sophistication;
• prior offences of this kind.

What Conduct Do Fraud Offences Capture?

In practice, fraud charges commonly arise in contexts such as:

• employment fraud, including false expense claims or payroll manipulation;
• business and contract fraud involving misleading representations;
• Centrelink and benefit-related fraud;
• insurance fraud;
• online, cyber, and identity-related fraud, including phishing and impersonation.

Part 4AA is capable of capturing a broad range of conduct including but not limited to:

• producing or submitting misleading documents, records or statements including documents relating to identification;
• destroying or concealing legitimate records;
• making misleading representations to obtain money or benefits;
• misusing funds entrusted for a particular purpose;
• dishonestly inducing another person to enter into a financial transaction;

It is important to note that no physical taking of property is required, and fraud may be established where the conduct of the victim is voluntary provided that their decision was induced by dishonesty or deception.

Jurisdiction and Where Fraud Matters Are Heard

Whilst fraud is commonly dealt with summarily in the Local Court and subject to jurisdictional limits on penalties, it is important to note that fraud is an indictable offence which may, on election, be committed to the District Court.

This can have a significant impact on the penalties to be imposed.

Potential Defences to Fraud Charges

Not all allegations of fraud result in criminal liability. Whether an offence is made out depends on very careful analysis of the evidence, and the elements of the particular offence charged.

As we have mentioned, fraud offences are treated seriously by the court specifically because they can be difficult to detect, and can be very difficult to prove beyond reasonable doubt.

Common issues in defending fraud charges include:

• whether any deception occurred at all;
• whether the conduct was objectively dishonest;
• whether the accused genuinely believed they were legally entitled to the benefit (claim of right); and
• whether the alleged benefit or disadvantage was actually caused by the accused’s conduct.

Certain fraud offences arise in complex commercial or administrative contexts, where disputes may sit at the boundary between civil liability and criminal wrongdoing. Identifying these issues early is critical to mounting an effective defence.

“The law in relation to Fraud offences in NSW provides for flexible and wide-reaching criminal liability, which is subject to considerable maximum penalties, and devastating consequences to one’s personal and professional life post-conviction.

The importance of individual, offence-specific legal advice as early in your proceedings as possible cannot be overstated. We have achieved great success in all manners of fraud related offences, including successful defence, effective plea resolutions and avoiding a criminal record. ”

Skye Nixon, Lamont Law