It was reported only few weeks that two former Harvey Norman staff members were slapped with 159 charges for the alleged theft of almost $600,000 from their employer. It was alleged in court that a man and a woman had obtained $594,000 by using fraudulent cheques, doing dodgy Eftpos transactions, and stealing cash when they worked at a Harvey Norman store. One of the charges related to a combined 104 counts of dishonestly obtain financial advantage by deception. So that is this charge, and what must be proven by the Police in order to be convicted?

Fraud

The charge of “dishonestly obtain financial advantage by deception” is a fraud related offence under s 192E(1) of the Crimes Act 1900 (NSW).

There are three types of conduct that relate to fraud under this section:

• by obtaining property; for example, by stealing goods.
• by obtaining any financial advantage; for example, skimming money from the employer, or directing transactions to be received into your own account or someone else’s account.
• by causing any financial disadvantage; for example, someone suffered financial loss because of the actions that you took.

Fraud is an offence which involves deception and dishonesty, which is something that the courts take very seriously. That’s one of the reasons why the maximum penalty is imprisonment for 10 years.

Elements which must be proved

There are three things that the prosecution must prove beyond a reasonable doubt in order to prove that a person is guilty of fraud under section 192E:

1. That by deception, you acted dishonestly, and
2. That your deceptive or dishonest conduct enabled you to:
   1. Obtain another person’s property, or
   2. Obtain a financial advantage, or
   3. Cause another to suffer financial disadvantage.
3. And that your actions were intentional or reckless.

Let’s break these down.

1. That by deception, you acted dishonestly

The prosecution must prove that you were deceptive and dishonest. The meaning of these two words are given in the law.

“Deception” includes the words you use or your conduct, such as the way you behave. This can include deceiving others about your intentions. It can also include using a computer, a machine, or any electronic device to do something that you’re not authorised to do. In the Harvey Norman case, it is likely the Crown will allege that the man and woman were deceptive to make unauthorised financial transactions. 

The prosecution must also prove that you acted dishonestly. Dishonesty is determined according to what ordinary people would consider to be dishonest, as well as what the accused knows to be dishonest according to ordinary people. 

2. That your deceptive or dishonest conduct enabled you to obtain another person’s property or a financial advantage, or cause another to suffer financial disadvantage:

To prove that you obtained another person’s property, the accused must have taken property from another person, which was either legally owned by that person, in possession of that person, or being controlled by that person. You can also obtain property dishonestly even if you are willing to pay for the property. Property includes physical property, or intangible property, like electronic money. In the Harvey Norman case, it is likely the Crown will allege that the man and woman obtained a financial advantage because they took money, which put them in a financially advantageous position.

You can also be guilty of fraud if you caused another person to suffer financial disadvantage. This means that the person lost finances that they should not have lost because of your actions.

The meaning of “obtain” and cause

This can include things such as:

• Obtaining a financial advantage for yourself or someone else, or causing a financial disadvantage to another person;
• Making a third person do something that causes you or another person to obtain a financial advantage, or that causes another person to suffer financial disadvantage;
• Obtaining a financial advantage, or causing a financial disadvantage, whether it is permanent or temporary.

3. That your actions were intentional or reckless.

In order to satisfy the definition of “deception”, the prosecution must prove that the deception was either intentional or reckless. This means that your actions were either deliberate, or reckless, meaning that you should have known that your actions were deceptive and dishonest, but you did it anyway.

Stealing money from an employer is taken seriously

If you are an employee who has breached your employer’s trust, especially by defrauding your employer out of large amounts of money, or you had such systemic dishonesty with planning and some sophistication (for example, you did this conduct many times over a long period of time), there are usually lengthy prison sentences involved. The courts use harsh sentences for fraud to deter this type of behaviour because due to businesses and government cannot operate without trusting employees.

What about the Harvey Norman case?

This case highlights how employers often put a lot of faith in their employees. Employees would tend to have a good understanding about the way that the business operates, the comings and goings of goods and money, and when an opportunity might rise for them to exploit this. This makes it difficult for employers to detect this, and the courts recognise that offenders usually continue such fraudulent conduct over long periods of time. Red flags are raised when auditing discovers amounts starting to add up, yet some fraudulent conduct may never be discovered at all – hence the harsh sentences imposed for fraud. It is highly likely that, if found guilty of the charges alleged, the man and woman may end up with hefty prison terms.

The above information is intended as general information and is not intended to be relied on as legal advice.

Pannu Lawyers extensively practice in Criminal Law and regularly appear at Courts throughout New South Wales. If your matter is at Blacktown Local Court, we are conveniently located within a walking distance from the Blacktown Local Court. Call our office on 02 9920 1787 or 1300 VAKEEL to discuss your matter in a confidential manner.