UK: Who Goes There?

Originally published in Solicitors Journal, 9 September 2008

Internet websites providing 'novelty' documents may seem harmless but solicitors must be aware of their potential use in criminal activity, says David McCluskey

Identity fraud is hardly new; after all, Zeus seduced Leda, Queen of Sparta, in the guise of a swan. Our culture is littered with assumed identities; scarcely a Shakespearean character could get his lines out without changing his name or his gender, and Tony Curtis famously adopted not one but two different personas in his attempt to woo Marilyn Monroe's Sugar Kane in Some Like it Hot. Let us not forget the wolf in Little Red Riding Hood, or Edward Fox's performance in Day of the Jackal, where the would-be assassin assumes the identity of a dead child and applies for a passport in his name – giving rise to the phrase 'Jackal Fraud'.

Home Office guidelines published in 2006 estimated the cost to the UK economy caused by identity fraud at £1.7 billion, an annual increase of £400m based on 2002 estimates. Identity fraud is clearly a significant cause for concern for UK business, and all commercial organisations are potentially at risk, including solicitors' firms that rely upon proof of identity documents for money laundering purposes before taking on new clients. The identification documents requested by solicitors are usually a passport and utility bill and the veracity of these documents is rarely checked.

'Novelty' document websites

There are a number of websites offering for sale packages of fake or 'novelty' ID documents. Commonly these include editable templates of bank statements, utility bills, payslips and P60s.

Such websites generally rely upon a proviso in their terms and conditions whereby the consumer signs an agreement that all documents on the site are for 'novelty and fun purposes only', and are not to be used for fraud, deception or any other criminal activity. The website disclaims any liability should the customer then commit fraud with the purchased documents (see for example: http://www.replicadoc.co.uk/terms.html).

However it is questionable whether, under recent fraud legislation, the liability of such websites really does end there, particularly where the nature of the customer belies a purpose other than mere 'novelty'.

Is the conduct of such websites covered under fraud legislation?

Firstly, it is important to remind ourselves that it has never been possible to exclude criminal liability by agreement. Fake or novelty websites that attempted to exclude their own criminal liability by requiring customers to sign terms and conditions could arguably not have relied upon this waiver under either old or new authority.

However, prior to the introduction of recent fraud legislation (in force from 2006 onwards) it might have been difficult to classify the conduct of such websites, offering fake or novelty documents for sale, as amounting to a criminal offence of itself.

Section 5(2) of the Forgery and Counterfeiting Act 1981 makes it an offence for a person to have in his custody or under his control, without lawful authority or excuse, an instrument which he knows or believes to be false. However, this section only applies to specified instruments which are valuable of themselves, such as money orders, postal orders, share certificates and travellers cheques, rather than focusing upon the potential uses to which documents may be put. While the type of documents generally offered for sale by novelty document websites (utility bill, P60, bank statements) may facilitate substantial gain if used for fraudulent purposes, of themselves they are valueless and may not be encompassed under this statute.

The common law offence of conspiracy to defraud would have been available to prosecutors seeking to prosecute fake or novelty document websites, but would have required proof of a dishonest agreement to expose a proposed victim to some form of economic risk or disadvantage to which he would not otherwise have been exposed.

Identity Cards Act 2006

Section 25(5) of the Identity Cards Act 2006 makes it an offence to for a person to have in his possession, without reasonable excuse, an identity document that is false. However, under s.26 the definition of an identity document is restricted to ID cards, immigration documents, passports and driving licences. It does not cover all the documents that might be relied on by lawyers to verify a person's identity.

Fraud Act 2006

Section 7 of the Fraud Act 2006 (in force on 15 January 2007) makes it an offence to make, adapt, supply or offer to supply any article:

  1. knowing that it is designed or adapted for use in the course of or in connection with fraud or;
  2. intending it to be used to commit or assist in the commission of fraud.

The definition of 'article' is given a wide meaning by virtue of s.8 of the FA 2006 and "includes any program or data held in electronic form". The Explanatory Notes indicate that it was Parliament's intention when passing s.7 to encompass within "electronic programs or data" computer templates which can be used to produce blank utility bills.

A defendant prosecuted under s.7 of the FA 2006 will presumably rely on the defence of lack of knowledge or intent.

Establishing intent, either direct or oblique (that is the defendant saw the event as a virtual certainty) under s.7(1)(b) of the FA 2006 may prove too high a hurdle for a prosecution. The terminology requires a nexus between the offer for supply of the document and, at the very least, the defendant foreseeing as virtually certain that the document would be used in a specific fraud. Further, according to Professor David Ormerod in CLR 2007 at 213, intention under s.7(1)(b) is arguably a narrower form of the offence because "assisting in the commission of fraud" is narrower than "for use in the course of, or in connection with, fraud", the latter encompassing articles used only preparatory to the commission of the fraud or after the commission of the fraud.

Therefore any prosecution brought against fake or novelty ID websites is likely to be brought under s.7(1)(a) of the FA 2006 where mens rea would be easier to prove. Here, the defendant is likely to rely on the defence that they had no knowledge that the article being offered for sale was designed or adapted for connection with a fraud, and is likely to rely upon any proviso contained in the terms and conditions of such websites that the documents are offered for novelty purposes only. The success of such a defence will depend on whether the jury consider there is any other legitimate purpose to which such documents could be put.

One such purpose might be use by customers as 'replacement documents'. One website which advertises such 'replacement documents' offers an inconsistent message on its homepage, on the one hand relying on the usual proviso that such products are to be used for 'theatrical, educational or novelty purposes' only and on the other hand claiming that in a disposable age where few of us keep paper copies of invoices, bank statements and utility bills, these documents will verify 'identity, address or income' and are prepared to the 'highest specification'.

It is an open question whether a 'replacement' document is nonetheless a false one, even if it exactly reflects the original in every respect (which is unlikely) and indeed whether a person who uses such a document in his own name for otherwise legitimate purposes (for example to open a bank account in his own name) is nonetheless committing fraud. However, where a website provider commercially offers for sale packages of identification documents that are then sold to repeat clients on behalf of different named individuals, the question then arises as to what purpose or intention such repeat clients could have in purchasing these documents. This would surely reflect on the mens rea of the person selling the documents.

Jurisdiction hurdle

The real hurdle in mounting a prosecution against fake or novelty document websites under s.7 of the FA 2006 will be one of location, as many fake or novelty websites will not be based in the UK.

Section 2 of the Criminal Justice Act 1993 (CJA 1993) provides the courts with jurisdiction over fraud offences "if any of the events which are relevant events in relation to the offence occurred in England and Wales". A 'relevant event' is defined as "any act or omission or other event, proof of which is required for conviction of the offence".

Section 4 of the CJA 1993 interprets 'relevant event' as a communication sent from abroad to the UK.

In order for the courts to have jurisdiction over a prosecution brought against any false identification website based abroad, the 'offer for sale' of the fake document must be interpreted as being a communication sent from abroad to the UK. This is a logical interpretation given that the website makes itself available for access within the UK, can be viewed via UK internet servers and the UK is where the consumer views the offer for supply of these documents.

However, the real complication facing a prosecution of fake or novelty websites based abroad will be the practical problems that arise from investigating a company based in a foreign jurisdiction.

A mutual legal assistance request would be required between the UK and the territory concerned to obtain evidence and request the extradition of individuals concerned. The efficacy of such a request would be dependent upon whether the territory concerned was one of the UK's extradition partners and, if not, would be dependent upon the existence of ad hoc arrangements between the two states.

Serious Crime Act 2007

Finally, s.44 and s.45 of the Serious Crime Act 2007 make it an offence to encourage or assist the commission of an offence if an individual:

  1. intends to encourage or assist its commission (s.44) or;
  2. believes that the offence will be committed and that his act will encourage or assist its commission (s.45).

An offence under s.6 of the Fraud Act 2006 (possession of articles for use in the course or in connection with any fraud) is deemed to be a serious offence for the purposes of the SCA 2007 (Schedule 1, Part 1, s.7(2)).

Proving the actus reus and mens rea of such an offence is likely to follow a route similar to s.7 of FA 2006. Intent perhaps being too high a hurdle, successful prosecution is more likely under s.45 of the SCA 2007.

The courts would face fewer jurisdictional obstacles in respect of a prosecution under s.44 or s.45.

Section 52(1) of the SCA 2007 provides that if an individual knows or believes that what he anticipates might take place wholly or partly in England or Wales, he may be guilty of an offence under s.44 or s.45 no matter where he was at any relevant time.

Neither s.44 nor s.45 of the SCA 2007 are yet in force, however even when they are implemented any prosecution of fake or novelty identification websites brought under these sections is likely to face similar practical difficulties as that under s.7 of the FA 2006.

Many such websites will be based offshore and consequently a prosecution would rely upon the assistance of foreign jurisdictions in order to obtain both personnel and sufficient evidence.

Little reported action

Despite the new legislation, there has been little reported action against novelty document websites. Internet reports suggest that the Metropolitan police launched an investigation into such websites in the summer of 2007. However, many such websites are still active and available on the internet.

The website Mortgage Strategy reports one Metropolitan detective as commenting that websites providing false bank statements and payslips would be difficult to shut down if they operated from overseas (www.mortgagestrategy.co.uk/cgi-bin/item.cgi?id=157176&d=pndpr&h=pnhpr).

David McCluskey is a partner at Peters & Peters. The author is grateful to Jo Dimmock, associate, for her assistance in researching and writing this article.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
In association with
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.