By: Andrew Anderson
Published: 13 January 2021
Published: 13 January 2021
By: Andrew Anderson
Fraud – Queensland
Fraud is a serious criminal offence in Queensland, which may be punishable by actual imprisonment. The essential element of the charge is proof of ‘dishonesty’, which requires the prosecution to prove that what a defendant did was dishonest by the standards of ordinary honest people.
Each legal issue is unique. This information cannot – and is not meant to – substitute legal consultation. It is designed to outline information of a general nature to people who want to learn more about the offence of fraud in Queensland.
If you face a fraud charge, contact Anderson Legal. This firm provides expert advice and representation. Andrew Anderson is a former Principal Crown Prosecutor and is recognised as a leading criminal defence lawyer in Queensland. He has substantial experience in assisting individuals with charges of this nature.
- Fraud – Queensland
- Queensland Law
- Possible Defences
- Penalties & Sentences
- Significant Cases
Section 408C Criminal Code (Qld)
Section 408C(1) of the Criminal Code makes fraud an offence in Queensland. The law states:
(1) A person who dishonestly—
(a) applies to his or her own use or to the use of any person—
(i) property belonging to another; or
(ii) property belonging to the person, or which is in the person’s possession, either solely or jointly with another person, subject to a trust, direction or condition or on account of any other person; or
(b) obtains property from any person; or
(c) induces any person to deliver property to any person; or
(d) gains a benefit or advantage, pecuniary or otherwise, for any person; or
(e) causes a detriment, pecuniary or otherwise, to any person; or
(f) induces any person to do any act which the person is lawfully entitled to abstain from doing; or
(g) induces any person to abstain from doing any act which that person is lawfully entitled to do; or
(h) makes off, knowing that payment on the spot is required or expected for any property lawfully supplied or returned or for any service lawfully provided, without having paid and with intent to avoid payment;
commits the crime of fraud.
Fraud: Proof of ‘Dishonesty’
For every criminal charge in Queensland, there are ‘elements’ that the prosecution must prove beyond reasonable doubt. Failure to prove just one element means the person charged must be found not guilty. Sometimes there will be an alternative offence that a person may then be found guilty of instead if proof of the primary charge fails.
Often the most critical element in a fraud charge is that of ‘dishonesty’. To secure a conviction, it is unnecessary for the prosecution to prove that the person charged realised that what he or she was doing was dishonest by the standards of ordinary honest people. Nevertheless, the knowledge, belief or intent of the person charged is far from irrelevant. It is an essential part in the determination of whether the acts by the person charged was dishonest by the standards of ordinary honest people. The relevance of the state of mind was explained in the High Court decision of Peters v The Queen  HCA 7 at paragraph :
In a case in which it is necessary for a jury to decide whether an act is dishonest, the proper course is for the trial judge to identify the knowledge, belief or intent which is said to render that act dishonest and to instruct the jury to decide whether the accused had that knowledge, belief or intent and, if so, to determine whether, on that account, the act was dishonest.
For a charge of fraud, before a person may be convicted, the knowledge, belief or intent of the person charged must be identified which renders his or her actions dishonest by the standards of ordinary, honest people.
The meaning of ‘dishonesty’ under section 408C of the Criminal Code (Qld) differs to other definitions of that word in other laws. For instance, in a case of Centrelink fraud, which is specifically charged under the Commonwealth Criminal Code, dishonesty is defined in section 130.3 of the Criminal Code (Cth). Under that law, to secure a conviction it is necessary to prove that the person charged knew their actions were dishonest according to the standards of ordinary people.
Given how central the issue of dishonesty is to fraud charges, it is critical to understand the different ways the word ‘dishonest’ may be interpreted. In reviewing an individual case, the work of a criminal lawyer often begins with a careful analysis of the evidence to determine the strengths and weaknesses of the prosecution case and, in particular, its ability to prove each element of the offence.
The ‘presumption of innocence’
When people think about a ‘defence’ to a charge, such as fraud, they generally thinking about what makes them ‘not guilty’ of the offence. However, it is for the prosecution to prove they are guilty – and to do so beyond a reasonable doubt. The presumption of innocence means that the defendant carries no onus of proof. What that means in practical terms is that it is for the prosecution to disprove any defences raised on the evidence.
For a charge of fraud, the prosecution must prove the elements of the offence beyond reasonable doubt. However, it must also exclude all defences that may apply beyond reasonable doubt. Of course, a defendant may give or call evidence that points to their innocence. The decision to give or call evidence does not shift the onus of proof away from the prosecution.
How are defences raised on the evidence?
A defence may be raised on the evidence of both the prosecution and the defence. That is, people who give witness statements to police may indicate that an event occurred accidentally, or a person appeared to act in self-defence. Generally speaking, the prosecution have an obligation to call all material witnesses at a trial – even those unfavourable to its case. Alternatively, a person charged with an offence may also call their own witnesses at a trial, which may provide the basis for a defence to be raised.
One of the important roles of a criminal lawyer is to identify, as early as possible, the relevant defences that may apply in a given case. The reason it is important to do it as early as possible is to ensure relevant witnesses are found while matters are freshest in their mind, or to prevent other evidence being lost or destroyed.
Common defences for ‘fraud’
It is likely that for many fraud cases, the real issue will be whether the prosecution can prove the person charged acted ‘dishonestly’. While the defence of ‘mistake of fact’ may, in some cases, be raised in defence to a fraud charge in Queensland, the Queensland Court of Appeal has been inconsistent in its view of the availability of the defence of ‘honest claim of right’. In R v Dillon; Ex parte Attorney-General (Qld)  QCA 155, the Court of Appeal indicated that the defence of honest claim under section 22 of the Criminal Code (Qld) would apply to fraud charges under section 408C of the Criminal Code:
As “dishonestly” in s 408C has its ordinary meaning, this Court must follow the meaning given to “dishonesty” by the High Court in Peters and Macleod. Despite the previously settled approach in Queensland since 1987, Queensland Courts must now construe the term “dishonestly” in s 408C as requiring the prosecution to prove only that what the accused person did was dishonest by the standards of ordinary honest people. To secure a conviction, the prosecution need not prove that the accused person must have realised that what he or she was doing was dishonest by those standards. This construction works harmoniously with the defence provisions of the Criminal Code, particularly s 22(2), so that, where there is evidence that the accused person had an honest belief that he or she was entitled to act as he or she did, to secure a conviction the prosecution must disprove the honest belief beyond reasonable doubt.
The case of R v Dillon; Ex parte Attorney-General (Qld)  QCA 155 was significant, as it altered the interpretation of ‘dishonesty’ in Queensland contrary to the interpretation that had been settled since 1987. As is clear from the above passage, it did so by reasoning that the interpretation worked ‘harmoniously’ with the defence of honest claim of right. However, in the case of R v Perrin  QCA 194, the defence of honest claim of right was held to be unavailable in the context of that case. It was stated by Justice Morrison:
The offence of fraud under s 408C expressly has the element of dishonesty, which, if proved, was necessarily inconsistent with an honest claim of right to do the act.
On the assumption that the defence of honest claim of right is unavailable as a specific defence, claims of right should be dealt with through the framework of the element of ‘dishonesty’. In Macleod v The Queen  HCA 24, the Chief Justice, along with Justices Gummow and Hayne quoted from Peters v The Queen  HCA 7 in stating:
“the intentional creation of a situation in which one person deprives another of money or property or puts the money or property of that other person at risk or prejudicially affects that person in relation to ‘some lawful right, interest, opportunity or advantage’, knowing that he or she has no right to deprive that person of that money or property or to prejudice his or her interests”.
Penalties & Sentences
The maximum penalty for fraud is 5 years imprisonment when no circumstance of aggravation applies.
The maximum penalty increases to 14 years imprisonment for convictions involving the following circumstances of aggravation:
- The offender is a director or officer of a corporation, and the victim is the corporation; or
- The offender is an employee of the victim; or
- Any property in relation to which the offence is committed came into the possession or control of the offender subject to a trust, direction or condition that it should be applied to any purpose or be paid to any person specified in the terms of trust, direction or condition or came into the offender’s possession on account of any other person; or
- The property, or the yield to the offender from the dishonesty, or the detriment caused, is of a value of at least $30,000 but less than $100,000; or
- The offender is or was an employer of the victim.
The maximum penalty increases to 20 years imprisonment for convictions involving the following circumstances of aggravation:
- the property, or the yield to the offender from the dishonesty, or the detriment caused, is of a value of at least $100,000; or
- the offender carries on the business of committing the offence.
While many offences under Queensland law do not carry mandatory minimum sentences, fraud does when a person is convicted of the following circumstance of aggravation:
- When a person is convicted of committing the offence and the serious organised crime circumstance of aggravation applies, 7 years’ imprisonment is automatically imposed cumulatively on the sentence the court decides. The 7 years’ imprisonment must be served wholly in prison, on top of whatever other penalty is set by the court.
Sentencing in Queensland
For a charge of fraud, the Penalties and Sentences Act (Qld) sets out a range of relevant sentencing considerations. For fraud and financial crimes under the Criminal Code (Qld), the law states that the court must have regard to the following considerations:
(a) principles that—
(i) a sentence of imprisonment should only be imposed as a last resort; and
(ii) a sentence that allows the offender to stay in the community is preferable; and
(b) the maximum and any minimum penalty prescribed for the offence; and
(c) the nature of the offence and how serious the offence was, including—
(i) any physical, mental or emotional harm done to a victim, including harm mentioned in information relating to the victim given to the court under section 179K; and
(ii) the effect of the offence on any child under 16 years who may have been directly exposed to, or a witness to, the offence; and
(d) the extent to which the offender is to blame for the offence; and
(e) any damage, injury or loss caused by the offender; and
(f) the offender’s character, age and intellectual capacity; and
(g) the presence of any aggravating or mitigating factor concerning the offender; and (ga) without limiting paragraph (g), whether the offender was a participant in a criminal organisation—
(i) at the time the offence was committed; or
(ii) at any time during the course of the commission of the offence; and
(h) the prevalence of the offence; and
(i) how much assistance the offender gave to law enforcement agencies in the investigation of the offence or other offences; and
(j) time spent in custody by the offender for the offence before being sentenced; and
(k) sentences imposed on, and served by, the offender in another State or a Territory for an offence committed at, or about the same time, as the offence with which the court is dealing; and
(l) sentences already imposed on the offender that have not been served; and
(m) sentences that the offender is liable to serve because of the revocation of orders made under this or another Act for contraventions of conditions by the offender; and
(n) if the offender is the subject of a community based order—the offender’s compliance with the order as disclosed in an oral or written report given by an authorised corrective services officer; and
(o) if the offender is on bail and is required under the offender’s undertaking to attend a rehabilitation, treatment or other intervention program or course—the offender’s successful completion of the program or course; and
(p) if the offender is an Aboriginal or Torres Strait Islander person—any submissions made by a representative of the community justice group in the offender’s community that are relevant to sentencing the offender, including, for example—
(i) the offender’s relationship to the offender’s community; or
(ii) any cultural considerations; or
(iii) any considerations relating to programs and services established for offenders in which the community justice group participates; and
(q) anything else prescribed by this Act to which the court must have regard; and
(r) any other relevant circumstance.
A wide range of penalties may be imposed for fraud charges in Queensland, ranging from bonds where no conviction may be recorded right through to lengthy terms of imprisonment. An example of a lengthy term of imprisonment may be seen in R v Lovell  QCA 43, in which a Ponzi scheme resulting in losses to investors of more than $11 million resulted in a sentence of 11 years imprisonment. The penalty in that case was imposed prior the maximum penalty being raised for offences of this type.
One matter that is taken into account for charges of this nature is the level of restitution made for any loss incurred by a victim. As was explained in R v Allen  QCA 73:
Restitution in full is a means of demonstrating that crime need not pay and sometimes does not pay and restitution can also be evidence of remorse quite independently from the benefit that it gives to the victim. That benefit is appropriately extended to the person being sentenced usually by significant reduction in any actual term of imprisonment imposed.
Experience shows that with fraud charges, where a significant quantum of money is concerned or there has been a breach of trust, significant penalties are imposed to act as deterrents to others.
The law involving fraud has involved a number of significant legal decisions over time, including in the Queensland Court of Appeal. These decisions, among others, shape the advice of lawyers who are called to represent individuals charged with fraud.
Queensland Court of Appeal
In R v Saba  QCA 275, the Queensland Court of Appeal allowed an appeal in which the appellant had been convicted of fraud based on him changing an ASIC register to show that he was the sole director and shareholder of two companies. The prosecution case was that this gave him the benefit of appearing to control those companies. However, the Court of Appeal ruled that such an appearance did not create a ‘benefit’ in terms of section 408C(1)(d) of the Criminal Code. It was said at paragraphs  – :
The scope of s 408C, and the potential for liability to criminal responsibility which it engages, where a person dishonestly gains a benefit or advantage pecuniary or otherwise, are undoubtedly wide. But they should not be extended by the tortured process of analysis advanced by the prosecution in this case. The submission of each electronic Form 484 may have formed part of some scheme whereby the appellant planned to defraud each company. But it was not itself a benefit under s 408C. It did not confer an advantage on the appellant by itself. It was at most a step along the way towards gaining some unidentified advantage.
This distinction between that which is gaining a benefit or advantage and that which, in a course of conduct, is anterior to gaining a benefit or advantage within the meaning of the text, is not to be viewed as purely a technical distinction. Where the distinction is elided, in some factual circumstances, successive offences will appear to have been created in relation to an intermediate “benefit or advantage” along the path of one course of conduct calculated to derive the actual benefit or advantage.
The following offences are possible charges that may be substituted for, or charged in addition to, a charge of fraud: