Canadian Criminal Sentencing/Offences/Fraud Over $5,000

Principles

 * See also Canadian Criminal Sentencing/Offences/Property Offences

Major instances of fraud over $5,000 require emphasis on general deterrence and denunciation. The same goes for cases involving breach of trust and offences that involve a substantial amount of dishonesty.

The purpose of the general deterrence is to assuage people from engaging in fraud which is often easy to commit and highly profitable. Without sufficient punishment, the temptation of taking the risk of a lesser punishment in exchange for a large sum of money would make it worthwhile.

Denunciation should adequately reflect the public’s condemnation of this offence and the offender’s conduct.

Conditional Sentences
Conditional Sentences are available for fraud over $5,000 when the Crown proceeds summarily, and should be considered by the court in any circumstances. . Note that as of November 20, 2012, s. 742.1 of the Criminal Code was amended such that a Conditional Sentence is not available for an accused person who is convicted of Fraud over $5,000 where the Crown has proceeded by Indictment.

However, the Supreme Court in Proulx stated that custodial sentences are preferable "[w]here punitive objectives such as denunciation and deterrence are particularly pressing, such as in cases in which there are aggravating circumstances".

For most courts, the amount defrauded will be sufficient to determine if incarceration is required.

In major frauds involving breach of trust, denunciation and deterrence are to be emphasized and will usually result in jail sentences.

Certain courts have stated that conditional sentence orders should not be granted where there is a breach of trust.

Incarceration is often ordered where there is no remorse. Also where there is no acceptance of responsibility.

Where there are exceptional or extreme personal mitigating circumstances, general deterrence can be satisfied by a conditional sentence.

Restitution and community service work are not sufficient to amount to exceptional circumstances to warrant a conditional sentence.

Where the aggravating factors overwhelm the mitigating factors, a sentence of imprisonment is mandated.

The “ruin and humiliation” brought upon the accused and his family due to the offence and professional loss coupled with a conditional sentence can be sufficient to satisfy denunciation and deterrence.

Ranges
Ontario cases have set the generally accepted range of sentence of major fraud at 3 to 6 years.

By function of s.730, discharges are not available for offences of fraud over $5,000.

Factors
Aggravating factors for major fraud include:
 * breach of trust
 * magnitude or size of the fraud
 * degree of sophistication, planning and deception
 * number of dishonest transactions undertaken in the offence
 * Duration of the dishonesty
 * number of victims
 * vulnerability of the victims
 * impact of the fraud upon the victims
 * nature and extent of the loss
 * efforts to conceal the fraud, including forging of documents
 * personal benefit
 * the number of people involved and the role of the offender
 * greed as sole motivator
 * termination of scheme by arrest or voluntarily
 * prior record

Mitigating factors for major fraud include: no record
 * “substantial recovery” of the proceeds of the dishonest conduct
 * voluntary repayment of restitution before sentencing
 * honest motive, including a medical condition, addiction, or other motivating cause other than greed or financial gain
 * major personal impact from offence, such as loss of job

No prior record is a limited factor since it is a common situation and, at least in relation to major fraud, the offender would have been less likely to have been in the position to commit the offence had the offender had a prior record. Further, the lack of record is usually trumped by the emphasis on general deterrence.

Good character is also of a limited factor as the good character will often help facilitate the offence. The person wil often have a place in the community and a good reputation and without which they would not have been able to commit the offence itself.

Factors such as the presence of gambling addictions cannot be considered mitigating but can have the effect of “[reducing] moral blameworthiness”

Theft of money by person entrusted with it in the course of his employment amounts to an abuse of trust within the meaning of s.718.2(a)(iii).

Relevant Probation Terms

 * Assessment and counselling
 * No contact with victims or related parties

Ancillary Orders

 * Stand-alone Restitution Order (Restitution is a required consideration under section 380.3)
 * Section 380.2 - Fraud Prohibition Order (section 380.2)