As mentioned in the first chapter, fraud is defined as deprivation through deception. This is what differentiates it from other crimes such as theft. We have looked at several elaborate schemes, including telemarketing fraud, recovery pitches, and identity thefts. But not all frauds are, or have to be, as sophisticated as those described. Sometimes the fraudster doesn’t even think that he is committing a fraud.
The following case studies are examples of simple, relatively unsophisticated frauds committed against friends and family. In some cases, the fraudster was more interested in retaliating against the victim for a perceived wrong than obtaining a substantial monetary gain. Whether the wrong committed was real or imaginary, the “aggrieved party” still took matters into their own hands in seeking satisfaction. It usually resulted in being charged with a criminal offence. When people are caught up in revenge, they do not consider the consequences.
HEAVEN HAS NO RAGE LIKE
LOVE TO HATRED TURNED…,
Mel owned several businesses in the city, and he had often made purchases for his home through the business. Mel had put a number of shares for the businesses in his wife’s name for tax purposes, although she was not involved in the operation of the businesses. When he and his wife, Natasha, separated in June, they completed a separation agreement, as there was no pre-nuptial agreement in place.
As a condition of the separation agreement, under the heading of “Business Interests,” one of Mel’s businesses was transferred to Natasha to provide her with an income. All shares and interests in the other businesses held by Natasha were transferred to Mel, making him the sole owner of these businesses and responsible for all details. One of the transferred businesses included Perfection Manufacturing Inc.
Natasha felt that Mel had used her. She had helped him in developing his businesses and that she was entitled to more than what was stipulated in the Separation Agreement. To show Mel that she was not someone who could be dismissed lightly, Natasha decided that she would get what she felt she deserved one way or another.
Natasha proceeded to purchase new furniture and building materials, both for her home and her business. She and Mel had used these companies in the past, so no questions were asked regarding her purchasing authority. It was only after requests for payment arrived that Mel discovered what Natasha had done.
Mel provided the police with copies of invoices placed by Natasha totaling $25,000 for furniture, supplies, and other items. In addition, on several occasions Natasha would show up at the business and take the mail, which included bills and invoices addressed to Perfection Manufacturing Inc. and Canadian Perfection Corp., both businesses still owned by Mel. According to some employees, Natasha would tear up the invoices and throw them in the garbage. Employees of Mel’s actually witnessed these and later recovered the torn invoices and turned them over to Mel.
Mel stated to the police that this activity has caused his business loss of reputation and services because he was unable to pay these bills. The police consulted with the Crown Prosecutor’s office and it was decided that this was a civil matter between a husband and wife and not in the interest of the public to pursue this case in a criminal court. No charges were filed against Natasha.
… NOR HELL A FURY LIKE A WOMAN SCORNED
Vanessa had been married to Tommy for nine years, and the couple had a seven-year-old boy. Tommy owned a contracting business that required him to work long hours while Vanessa stayed at home and raised their son. With the growing economy, Tommy’s business began doing very well. As his business became more successful, Tommy had opportunities to expand into other areas. After nine years, Tommy decided that he would leave Vanessa because he had met someone else. In the separation agreement, Tommy agreed to provide child support of $2,000 per month for their son. However, Tommy was not always on time with the agreed support.
One afternoon, Tommy met with Vanessa and stated that he was no longer willing to pay the amount they had agreed upon for child support. Instead, Tommy gave Vanessa a cheque for $1,500 for that month. Vanessa was upset and hurt. Not only was this not fair, but Tommy thought he could get away with giving her a lesser amount. Vanessa looked at the cheque and saw that the dollar amount was not filled in. In his anger, he had signed the cheque but forgot to include an amount. Vanessa made the cheque out for $5,000.
When the cheque cleared Tommy’s account, Tommy took the cheque to the police and wanted Vanessa charged with fraud. The police had little choice but to charge Vanessa. She admitted to filling in the $5,000 on the cheque because of the way Tommy had been treating her. Whether this was fair or not was not a factor the police could take into consideration. Vanessa received a $200 fine and two years probation, while Tommy is still late with his child support payments.
It is always easier to think of fraudsters as someone we don’t know. Our friends and family are too close to us and would never jeopardize our relationship by stealing or lying. But what if that relationship goes sour and you bitterly part company?
In a general sense, spouses cannot steal from one another. Once you are married, or have been living together for some time, the property becomes communal and shared equally between the two. This also includes finances. However, if the couple should separate and, after the separation, one commits fraudulent activities, there may be a case for a criminal investigation.
Unfortunately, these types of fraud are very difficult for investigators and the courts to deal with, generally because of the ambiguity of the relationships. Both parties often make promises without writing them down, and the high emotions that are in play often end up as confusing and misunderstood statements.
Frequently, the party that contacts the police is not concerned with the money that has been lost. They are more interested in seeing what they perceive to be justice being done, and to have their ex-spouse punished and “taught a lesson.” More likely than not, these situations are better dealt with through the assistance of a mediator, counselor, or a lawyer, and not through the criminal courts. A criminal investigation is not the best way to resolve the problem.