Fraud

Common law, Fraud Act 2006, s.1, Theft Act 1968, s.17
Effective from: 1 October 2014

Fraud by false representation, fraud by failing to disclose information, fraud by abuse of position, Fraud Act 2006 (section 1)
Triable either way

Conspiracy to defraud, Common law
Triable on indictment only

Maximum: 10 years’ custody
Offence range: Discharge – 8 years’ custody

False accounting, Theft Act 1968 (section 17)
Triable either way
Maximum: 7 years’ custody
Offence range: Discharge – 6 years and 6 months’ custody

User guide for this offence


Applicability

In accordance with section 120 of the Coroners and Justice Act 2009, the Sentencing Council issues this definitive guideline. It applies to all individual offenders aged 18 and older and to organisations who are sentenced on or after 1 October 2014, regardless of the date of the offence.

Section 125(1) of the Coroners and Justice Act 2009 provides that when sentencing offences committed after 6 April 2010:

“Every court –

  1. must, in sentencing an offender, follow any sentencing guideline which is relevant to the offender’s case, and
  2. must, in exercising any other function relating to the sentencing of offenders, follow any sentencing guidelines which are relevant to the exercise of the function,

unless the court is satisfied that it would be contrary to the interests of justice to do so.”

This guideline applies only to individual offenders aged 18 and older or organisations. General principles to be considered in the sentencing of youths are in the Sentencing Guidelines Council’s definitive guideline, Sentencing children and young people – overarching principles.

Structure, ranges and starting points

For the purposes of section 125(3)–(4) Coroners and Justice Act 2009, the guideline specifies offence ranges – the range of sentences appropriate for each type of offence. Within each offence, the Council has specified a number of categories which reflect varying degrees of seriousness. The offence range is split into category ranges – sentences appropriate for each level of seriousness. The Council has also identified a starting point within each category.

Starting points define the position within a category range from which to start calculating the provisional sentence. The court should consider further features of the offence or the offender that warrant adjustment of the sentence within the range, including the aggravating and mitigating factors set out at step two.1 Starting points and ranges apply to all offenders, whether they have pleaded guilty or been convicted after trial. Credit for a guilty plea is taken into consideration only after the appropriate sentence has been identified.2


  1. Aggravating and mitigating factors are at step four in the guideline for organisations. In the guideline for organisations, having identified a provisional sentence within the range at step four, the court is required to consider a further set of factors that may require a final adjustment to the sentence at step five.
  2. In the guideline for organisations, guilty pleas are considered at step seven; in the guidelines for individuals, guilty pleas are considered at step four.

Step 1 – Determining the offence category

The court should determine the offence category with reference to the tables below. In order to determine the category the court should assess culpability and harm.

The level of culpability is determined by weighing up all the factors of the case to determine the offender’s role and the extent to which the offending was planned and the sophistication with which it was carried out.

Culpability demonstrated by one or more of the following

A – High culpability

  • A leading role where offending is part of a group activity
  • Involvement of others through pressure, influence
  • Abuse of position of power or trust or responsibility
  • Sophisticated nature of offence/significant planning
  • Fraudulent activity conducted over sustained period of time
  • Large number of victims
  • Deliberately targeting victim on basis of vulnerability

B – Medium culpability

  • Other cases where characteristics for categories A or C are not present
  • A significant role where offending is part of a group activity

C – Lesser culpability

  • Involved through coercion, intimidation or exploitation
  • Not motivated by personal gain
  • Peripheral role in organised fraud
  • Opportunistic ‘one-off’ offence; very little or no planning
  • Limited awareness or understanding of the extent of fraudulent activity

Where there are characteristics present which fall under different levels of culpability, the court should balance these characteristics to reach a fair assessment of the offender’s culpability.

Harm

Harm is initially assessed by the actual, intended or risked loss as may arise from the offence.

The values in the table below are to be used for actual or intended loss only.

Intended loss relates to offences where circumstances prevent the actual loss that is intended to be caused by the fraudulent activity.

Risk of loss (for instance in mortgage frauds) involves consideration of both the likelihood of harm occurring and the extent of it if it does. Risk of loss is less serious than actual or intended loss. Where the offence has caused risk of loss but no (or much less) actual loss the normal approach is to move down to the corresponding point in the next category. This may not be appropriate if either the likelihood or extent of risked loss is particularly high.

Harm A – Loss caused or intended
Category 1 £500,000 or more Starting point based on £1 million
Category 2 £100,000 – £500,000 or Risk of category 1 harm Starting point based on £300,000
Category 3 £20,000 – £100,000 or Risk of category 2 harm Starting point based on £50,000
Category 4 £5,000 – £20,000 or Risk of category 3 harm Starting point based on £12,500
Category 5 Less than £5,000 or Risk of category 4 harm Starting point based on £2,500
Risk of category 5 harm, move down the range within the category

Harm B – Victim impact demonstrated by one or more of the following

The court should then take into account the level of harm caused to the victim(s) or others to determine whether it warrants the sentence being moved up to the corresponding point in the next category or further up the range of the initial category.

Level of harm: victim impact

High impact – move up a category; if in category 1 move up the range

  • Serious detrimental effect on the victim whether financial or otherwise, for example substantial damage to credit rating
  • Victim particularly vulnerable (due to factors including but not limited to their age, financial circumstances, mental capacity)

Medium impact – move upwards within the category range

  • Considerable detrimental effect on the victim whether financial or otherwise

Lesser impact – no adjustment

  • Some detrimental impact on victim, whether financial or otherwise

Step 2 – Starting point and category range

Having determined the category at step one, the court should use the appropriate starting point (as adjusted in accordance with step one above) to reach a sentence within the category range in the table below. The starting point applies to all offenders irrespective of plea or previous convictions.

Where the value is larger or smaller than the amount on which the starting point is based, this should lead to upward or downward adjustment as appropriate.

Where the value greatly exceeds the amount of the starting point in category 1, it may be appropriate to move outside the identified range.

Table 1

Section 1 Fraud Act 2006
Conspiracy to defraud
Maximum: 10 years’ custody

Table 1: Fraud - Conspiracy to defraud
  Culpability
Harm A B C
Category 1

£500,000 or more

Starting point based on £1 million

Starting point
7 years’ custody
Starting point
5 years’ custody
Starting point
3 years’ custody
Category range
5 – 8 years’ custody
Category range
3 – 6 years’ custody
Category range
18 months’ – 4 years’ custody
Category 2

£100,000 – £500,000

Starting point based on £300,000

Starting point
5 years’ custody
Starting point
3 years’ custody
Starting point
18 months’ custody
Category range
3 – 6 years’ custody
Category range
18 months’ – 4 years’ custody
Category range
26 weeks’ – 3 years’ custody
Category 3

£20,000 - £100,000

Starting point based on £50,000

Starting point
3 years’ custody
Starting point
18 months’ custody
Starting point
26 weeks’ custody
Category range
18 months’ – 4 years’ custody
Category range
26 weeks’ – 3 years’ custody
Category range
Medium level community order – 1 year’s custody
Category 4

£5,000- £20,000

Starting point based on £12,500

Starting point
18 months’ custody
Starting point
26 weeks’ custody
Starting point
Medium level community order
Category range
26 weeks’ – 3 years’ custody
Category range
Medium level community order – 1 year’s custody
Category range
Band B fine – High level community order
Category 5

Less than £5,000

Starting point based on £2,500

Starting point
36 weeks’ custody
Starting point
Medium level community order
Starting point
Band B fine
Category range
High level community order – 1 year’s custody
Category range
Band B fine – 26 weeks’ custody
Category range
Discharge – Medium level community order

Table 2

Section 17 Theft Act 1968: False accounting
Maximum: 7 years’ custody

Table 2: Fraud - False accounting
  Culpability
Harm A B C
Category 1

£500,000 or more

Starting point based on £1 million

Starting point
5 years 6 months’ custody
Starting point
4 years’ custody
Starting point
2 years 6 months’ custody
Category range
4 years’ – 6 years 6 months’ Custody
Category range
2 years 6 months’ – 5 years’ custody
Category range
15 months’ – 3 years 6 months’ custody
Category 2

£100,000 – £500,000

Starting point based on £300,000

Starting point
4 years’ custody
Starting point
2 years 6 months’ custody
Starting point
15 months’ custody
Category range
2 years 6 months’ – 5 years’ custody
Category range
15 months’ – 3 years 6 months’ custody
Category range
26 weeks’ – 2 years 6 months’ custody
Category 3

£20,000 – £100,000

Starting point based on £50,000

Starting point
2 years 6 months’ custody
Starting point
15 months’ custody
Starting point
High level community order
Category range
15 months’ – 3 years 6 months’ custody
Category range High level community order – 2 years 6 months’ custody Category range

Low level community order – 36 weeks’ custody

Category 4

£5,000 – £20,000

Starting point based on £12,500

Starting point 15 months’ custody Starting point High level community order Starting point Low level community order
Category range High level community order – 2 years 6 months’ custody Category range
Low level community order – 36 weeks’ custody
Category range
Band B fine – Medium level community order
Category 5

Less than £5,000

Starting point based on £2,500

Starting point
26 weeks’ custody
Starting point
Low level community order
Starting point
Band B fine
Category range
Medium level community order – 36 weeks’ custody
Category range
Band B fine – Medium level community order
Category range
Discharge – Low level community order

Band ranges
Starting point Range
Fine Band A  50% of relevant weekly income  25 – 75% of relevant weekly income
Fine Band B  100% of relevant weekly income  75 – 125% of relevant weekly income
Fine Band C  150% of relevant weekly income 125 – 175% of relevant weekly income
Fine Band D  250% of relevant weekly income 200 – 300% of relevant weekly income
Fine Band E 400% of relevant weekly income 300 – 500% of relevant weekly income
Fine Band F  600% of relevant weekly income  500 – 700% of relevant weekly income
Community orders table

The seriousness of the offence should be the initial factor in determining which requirements to include in a community order. Offence-specific guidelines refer to three sentencing levels within the community order band based on offence seriousness (low, medium and high). See below for non-exhaustive examples of requirements that might be appropriate in each.

At least one requirement MUST be imposed for the purpose of punishment and/or a fine imposed in addition to the community order unless there are exceptional circumstances which relate to the offence or the offender that would make it unjust in all the circumstances to do so. For further information see Imposition of community and custodial sentences.

A suspended sentence MUST NOT be imposed as a more severe form of community order. A suspended sentence is a custodial sentence.

Low Medium High
Offences only just cross community order threshold, where the seriousness of the offence or the nature of the offender’s record means that a discharge or fine is inappropriate

In general, only one requirement will be appropriate and the length may be curtailed if additional requirements are necessary

Offences that obviously fall within the community order band Offences only just fall below the custody threshold or the custody threshold is crossed but a community order is more appropriate in the circumstances

More intensive sentences which combine two or more requirements may be appropriate

Suitable requirements might include:

  • Any appropriate rehabilitative requirement(s)
  • 40 – 80 hours of unpaid work
  • Curfew  requirement within the lowest range (for example up to 16 hours per day for a few weeks)
  • Exclusion requirement, for a few months
  • Prohibited activity requirement
  • Attendance centre requirement (where available)
Suitable requirements might include:

  • Any appropriate rehabilitative requirement(s)
  • Greater number of hours of unpaid work (for example 80 – 150 hours)
  • Curfew requirement within the middle range (for example up to 16 hours for 2 – 3 months)
  • Exclusion requirement lasting in the region of 6 months
  • Prohibited activity requirement
Suitable requirements might include:

  • Any appropriate rehabilitative requirement(s)
  • 150 – 300 hours of unpaid work
  • Curfew requirement for example up to 16 hours per day for 4 – 12 months
  • Exclusion requirement lasting in the region of 12 months

* If order does not contain a punitive requirement, suggested fine levels are indicated below:

BAND A FINE

BAND B FINE

BAND C FINE

Custodial sentences

Fuller information and sentencing flowcharts are available at Imposition of Community and Custodial Sentences definitive guideline.


The approach to the imposition of a custodial sentence should be as follows:

1) Has the custody threshold been passed?

  • A custodial sentence must not be imposed unless the offence or the combination of the offence and one or more offences associated with it was so serious that neither a fine alone nor a community sentence can be justified for the offence.
  • There is no general definition of where the custody threshold lies. The circumstances of the individual offence and the factors assessed by offence-specific guidelines will determine whether an offence is so serious that neither a fine alone nor a community sentence can be justified. Where no offence specific guideline is available to determine seriousness, the harm caused by the offence, the culpability of the offender and any previous convictions will be relevant to the assessment.
  • The clear intention of the threshold test is to reserve prison as a punishment for the most serious offences.

2) Is it unavoidable that a sentence of imprisonment be imposed?

  • Passing the custody threshold does not mean that a custodial sentence should be deemed inevitable. Custody should not be imposed where a community order could provide sufficient restriction on an offender’s liberty (by way of punishment) while addressing the rehabilitation of the offender to prevent future crime.
  • For offenders on the cusp of custody, imprisonment should not be imposed where there would be an impact on dependants which would make a custodial sentence disproportionate to achieving the aims of sentencing.

3) What is the shortest term commensurate with the seriousness of the offence?

  • In considering this the court must NOT consider any licence or post sentence supervision requirements which may subsequently be imposed upon the offender’s release.

4) Can the sentence be suspended?

  • A suspended sentence MUST NOT be imposed as a more severe form of community order. A suspended sentence is a custodial sentence. Sentencers should be clear that they would impose an immediate custodial sentence if the power to suspend were not available. If not, a non-custodial sentence should be imposed.

The following factors should be weighed in considering whether it is possible to suspend the sentence:

Factors indicating that it would not be appropriate to suspend a custodial sentence

Factors indicating that it may be appropriate to suspend a custodial sentence

Offender presents a risk/danger to the public

Realistic prospect of rehabilitation

Appropriate punishment can only be achieved by immediate custody

Strong personal mitigation

History of poor compliance with court orders

Immediate custody will result in significant harmful impact upon others

The imposition of a custodial sentence is both punishment and a deterrent. To ensure that the overall terms of the suspended sentence are commensurate with offence seriousness, care must be taken to ensure requirements imposed are not excessive. A court wishing to impose onerous or intensive requirements should reconsider whether a community sentence might be more appropriate.

Pre-sentence report

Whenever the court reaches the provisional view that:

  • the custody threshold has been passed; and, if so
  • the length of imprisonment which represents the shortest term commensurate with the seriousness of the offence;

the court should obtain a pre-sentence report, whether verbal or written, unless the court considers a report to be unnecessary. Ideally a pre-sentence report should be completed on the same day to avoid adjourning the case.

Magistrates: Consult your legal adviser before deciding to sentence to custody without a pre-sentence report.

The table below contains a non-exhaustive list of additional factual elements providing the context of the offence and factors relating to the offender.

Identify whether any combination of these or other relevant factors should result in an upward or downward adjustment from the sentence arrived at so far.

Consecutive sentences for multiple offences may be appropriate where large sums are involved.

Factors increasing seriousness

Statutory aggravating factors

  • Previous convictions, having regard to a) the nature of the offence to which the conviction relates and its relevance to the current offence; and b) the time that has elapsed since the conviction
  • Offence committed whilst on bail

Other aggravating factors

  • Steps taken to prevent the victim reporting or obtaining assistance and/or from assisting or supporting the prosecution
  • Attempts to conceal/dispose of evidence
  • Established evidence of community/wider impact
  • Failure to comply with current court orders
  • Offence committed on licence
  • Offences taken into consideration
  • Failure to respond to warnings about behaviour
  • Offences committed across borders
  • Blame wrongly placed on others

Factors reducing seriousness or reflecting personal mitigation

  • No previous convictions or no relevant/recent convictions
  • Remorse
  • Good character and/or exemplary conduct
  • Little or no prospect of success
  • Serious medical conditions requiring urgent, intensive or long-term treatment
  • Age and/or lack of maturity where it affects the responsibility of the offender
  • Lapse of time since apprehension where this does not arise from the conduct of the offender
  • Mental disorder or learning disability
  • Sole or primary carer for dependent relatives
  • Offender co-operated with investigation, made early admissions and/or voluntarily reported offending
  • Determination and/or demonstration of steps having been taken to address addiction or offending behaviour
  • Activity originally legitimate

Step 3 – Consider any factors which indicate a reduction, such as assistance to the prosecution

The court should take into account sections 73 and 74 of the Serious Organised Crime and Police Act 2005 (assistance by defendants: reduction or review of sentence) and any other rule of law by virtue of which an offender may receive a discounted sentence in consequence of assistance given (or offered) to the prosecutor or investigator.

Step 4 – Reduction for guilty pleas

The court should take account of any potential reduction for a guilty plea in accordance with section 144 of the Criminal Justice Act 2003 and the guideline for Reduction in Sentence for a Guilty Plea (where first hearing is on or after 1 June 2017, or first hearing before 1 June 2017).

Step 5 – Totality principle

If sentencing an offender for more than one offence, or where the offender is already serving a sentence, consider whether the total sentence is just and proportionate to the overall offending behaviour. See Totality guideline.

Step 6 – Confiscation, compensation and ancillary orders

The court must proceed with a view to making a confiscation order if it is asked to do so by the prosecutor or if the court believes it is appropriate for it to do so.

Where the offence has resulted in loss or damage the court must consider whether to make a compensation order.

If the court makes both a confiscation order and an order for compensation and the court believes the offender will not have sufficient means to satisfy both orders in full, the court must direct that the compensation be paid out of sums recovered under the confiscation order (section 13 of the Proceeds of Crime Act 2002).

The court may also consider whether to make ancillary orders. These may include a deprivation order, a financial reporting order, a serious crime prevention order and disqualification from acting as a company director.

Step 7 – Reasons

Section 174 of the Criminal Justice Act 2003 imposes a duty to give reasons for, and explain the effect of, the sentence.

Step 8 – Consideration for time spent on bail

The court must consider whether to give credit for time spent on bail in accordance with section 240A of the Criminal Justice Act 2003.