Can I be charged with Intention to Deceive Members or Creditors if the statement was only verbally made?

In New South Wales, telling a porky with the aim to trick folks or creditors of a group is a big no-no. As mentioned in Section 192H of the Crimes Act 1900 (NSW), the penalties are hefty and can haunt you for a long time if caught. We delve into the details of the dodgy act of fibbing to members or creditors, checking out what makes up the offence, what you might say to defend yourself, what the slap on the wrist looks like, and how the courtroom saga unfolds. Get ready to discover what it’s all about!

This information is crucial for anyone who is facing allegations of this offence, or who is concerned about the potential legal ramifications of making statements about an organisation’s affairs. By understanding the law, individuals can better protect themselves and make informed decisions when dealing with sensitive financial information.

What the Prosecution Must Prove for an Intention to Deceive Members or Creditors Offence

To secure a conviction for “Intention to Deceive Members or Creditors by False or Misleading Statement of Officer of Organisation”, the prosecution must prove several elements beyond reasonable doubt. This high standard of proof means that the prosecution must present evidence that is so convincing that there is no reasonable doubt in the minds of the jury (or magistrate, if the case is heard in the Local Court) that the accused is guilty. Failing to prove any one of these elements could lead to an acquittal.

Here are the key elements the police must prove:

1. You were an officer of an organisation: As explained earlier, an “officer” encompasses individuals involved in the organisation’s management, including directors, managers, and those acting in a managerial capacity.
2. You acted dishonestly: “Dishonesty” is assessed according to the standards of ordinary people. The prosecution must demonstrate that your actions, in making the false or misleading statement, would be considered dishonest by the average person. For instance, consider a situation where a company director deliberately inflates sales figures in a report to shareholders to conceal the company’s poor financial performance. This act, designed to mislead shareholders about the true state of the company’s affairs, would likely be deemed dishonest by ordinary standards.
3. You made or published, or concurred in the making or publishing of a statement: This element covers both written and verbal statements. For example, presenting a misleading financial report in writing or making false claims about the company’s profitability during a verbal presentation to investors could both satisfy this element.
4. The statement was misleading in a material particular: A statement is considered false if it is untrue, while a misleading statement creates a false impression. “Material particular” refers to information that is significant or consequential to the overall message conveyed by the statement. Trivial or inconsequential inaccuracies wouldn’t meet this threshold.
5. You made the statement with the intention of deceiving members or creditors of the organisation: This element focuses on your mental state at the time of making the statement. The prosecution must prove that you intended to mislead members or creditors about the organisation’s affairs. For example, if a company officer deliberately concealed a significant debt in a financial report presented to creditors to secure a loan, their actions would likely demonstrate an intention to deceive.

Proving the Statement was Misleading in a Material Particular

The prosecution must demonstrate that the statement you made was not merely inaccurate but was false or misleading in a way that was significant and relevant to the decision-making of the people who relied on it. A minor error in a financial report that wouldn’t affect a creditor’s decision to lend money, for example, wouldn’t be considered a ‘material particular’. However, if the report omitted a major liability that would have significantly impacted the creditor’s decision, it would likely be considered a material misrepresentation.

Proving “Dishonesty” in Making the Statement

The concept of “dishonesty” is central to this offence. It is determined by applying the standards of ordinary people. The jury, representing the community, decides whether the actions of the accused would be considered dishonest by the average person. It’s important to note that this assessment is objective, meaning that it doesn’t depend on the accused’s personal beliefs about what is right or wrong.

Proving the Intention to Deceive Members or Creditors

The prosecution must prove that you had a specific intent to mislead members or creditors about the organisation’s affairs when you made the false or misleading statement. To illustrate this concept, let’s say a company director presented a rosy financial forecast to potential investors, knowing that the company was facing imminent bankruptcy. This act, designed to induce investors to part with their money based on a false understanding of the company’s future, would likely demonstrate the required intention to deceive.

Defences to the Intention to Deceive Members or Creditors Offence

If you are facing charges of Intention to Deceive Members or Creditors by False or Misleading Statement, there are several defences that you might be able to raise. It’s important to remember that the burden of proof lies with the prosecution. Your lawyer doesn’t need to prove your innocence; rather, they need to raise enough doubt about the prosecution’s case to secure an acquittal.

Claim of Right

This defence applies when you genuinely believed you had a legal right to act in the way you did, even if your belief was mistaken. For example, if a company director made a statement about the company’s financial position based on legal advice they received, but the advice was later found to be incorrect, they might have a right to defend themselves. The key here is that your belief must have been honest, even if it wasn’t reasonable.

Factual Challenge

This defence involves disputing the factual basis of the prosecution’s case. You might argue that you didn’t make the statement, that the statement wasn’t false or misleading, or that you didn’t intend to deceive anyone. For instance, consider a situation where multiple officers were involved in preparing a financial report. If you are accused of making a false statement in that report, but you can demonstrate that you weren’t responsible for that particular section, you would be mounting a factual challenge to the prosecution’s allegations.

Challenging the Prosecution’s Evidence

Even if you don’t have a specific legal defence, your lawyer can still challenge the prosecution’s evidence. They might argue that the evidence is unreliable, incomplete, or that it doesn’t prove the elements of the offence beyond a reasonable doubt. For example, if the prosecution relies on witness testimony, your lawyer can cross-examine those witnesses to highlight inconsistencies or biases in their statements, potentially casting doubt on the reliability of their evidence.

Remember, each case is unique, and the success of a defence will depend on the specific facts and circumstances. It’s essential to seek advice from an experienced criminal lawyer to determine the best defence strategy for your situation.

Which Court Will Hear an Intention to Deceive Members or Creditors Offence?

The offence of Intention to Deceive Members or Creditors by False or Misleading Statement of Officer of Organisation is a Table 1 offence under the Criminal Procedure Act 1986 (NSW). This means that the case can be heard in either the Local Court or the District Court.

The prosecution may choose to commence the proceedings in the Local Court. However, if they believe that the matter is too serious for the Local Court, they can elect to have the case heard in the District Court. Similarly, you, as the defendant, have the right to elect to have the matter dealt with in the District Court.

The decision of which court hears the case can have significant implications. The maximum penalty that can be imposed by the Local Court is lower than that of the District Court. Additionally, the District Court process can be more complex and involve a jury trial.

Penalties for Intention to Deceive Members or Creditors by False or Misleading Statement

If you are found guilty of the offence of Intention to Deceive Members or Creditors, the court has a range of penalties at its disposal. The severity of the sentence will depend on a number of factors, including the seriousness of the offence, your criminal history, and whether any mitigating circumstances exist.

Maximum Penalty

The maximum penalty for this offence under Section 192H is seven years imprisonment. This maximum penalty is reserved for the most serious instances of the offence, where there was significant deception, substantial harm caused, or aggravating factors involved. For instance, consider a situation where a company director made numerous false statements over a prolonged period, resulting in substantial financial losses for investors and creditors. This type of conduct, demonstrating a blatant disregard for the law and causing significant harm, would be more likely to attract a harsher penalty.

Other Sentencing Options

While imprisonment is the most serious penalty, the court can impose a variety of other sentences, including:

• Intensive Corrections Orders (ICO): An ICO is a custodial sentence served in the community. It involves strict supervision and conditions, such as community service, curfews, and mandatory participation in rehabilitation programs.
• Community Correction Orders (CCO): A CCO is a non-custodial sentence that can include conditions such as community service, supervision, and restrictions on your activities.
• Fines: The court can impose a monetary penalty. The amount of the fine will depend on the severity of the offence and your financial circumstances.
• Conditional Release Order (CRO): A CRO is a non-custodial order that allows you to avoid a conviction if you comply with certain conditions, such as good behaviour and not re-offending.
• Section 10 Dismissal: A Section 10 dismissal allows the court to find you guilty of the offence but dismiss the charge without recording a conviction, often subject to a good behaviour bond. This option is usually reserved for less serious offences or first-time offenders.

Sentencing Considerations

When deciding on the appropriate penalty, the court will consider several factors, including:

• The seriousness of the offence: The court will consider the nature of the false or misleading statements, the extent of the deception, and the harm caused to the victims.
• Your criminal history: Your prior convictions, if any, will be taken into account. Previous offences of dishonesty or fraud could lead to a more severe penalty.
• Your remorse and prospects for rehabilitation: The court will consider whether you have shown genuine remorse for your actions and whether you are likely to re-offend. Taking responsibility for your actions and demonstrating steps towards rehabilitation can lead to a more lenient sentence.
• Mitigating circumstances: The court may take into account any factors that reduce your culpability, such as duress, mental health issues, or difficult personal circumstances.

It is crucial to understand that the sentencing process is complex and that each case is judged on its own merits. It is essential to have experienced legal representation to ensure that all relevant factors are presented to the court and that you have the best chance of receiving the most lenient penalty possible.

Conclusion

The offence of Intention to Deceive Members or Creditors by False or Misleading Statement is a serious charge with potentially severe consequences. The law is designed to protect the financial interests of members and creditors of organisations by holding officers accountable for dishonest and deceptive conduct.

Understanding the elements of the offence, available defences, and potential penalties is crucial for anyone facing allegations or concerns related to this area of law. Seeking legal advice from an experienced criminal lawyer is essential to navigate the complexities of the legal process and to protect your rights.