This Practice Note deals with the authorities on the meaning of ‘fraud’ and provides an overview of the key principles that apply to business insureds, both at inception of their insurance policies and during the claims process. What constitutes fraud and how is it proved? Fraud There is no precise definition of fraud in an insurance context. One of the classic tests for deceit can be found in the speech of Lord Herschell in Derry v Peek: ‘First, in order to sustain an action of deceit, there must be proof of fraud and nothing short of that will suffice. Secondly, fraud is proved when it is shown that a false representation has been made (i) knowingly, (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false. Although I have treated the second and third as distinct cases, I think the third is but an instance of the second, for one who makes a statement under such circumstances can have no real belief

This Practice Note explains the offences of fraud by failing to disclose and fraud by abuse of position under sections 3 and 4 of the Fraud Act 2006 (FrA 2006), both of which are ways in which the general fraud offence under FrA 2006, s 1 can be committed. These are the offences most commonly used against professionals, fiduciaries or people in a position of trust or with a fiduciary relationship to the victim. Fraud by failure to disclose information An offence of fraud by failure to disclose is committed where a defendant: • dishonestly fails to disclose information to another person while under a legal duty to do so, and • with the intention to make a gain for themselves or others, or • with the intention to cause a loss to someone else or to expose them to a risk of loss A person who commits an act falling within this definition, will have committed the general fraud offence under FrA 2006, s 1. The offence is focused

This Practice Note covers the offence of fraud by false representation. You may also be interested in the following Practice Notes: • Fraud by failure to disclose and abuse of position • Obtaining services dishonestly under the Fraud Act 2006 • Possessing or making articles for use in fraud • Conspiracy to defraud • Internal company fraud investigations For civil fraud claims, see: Civil fraud—overview. Fraud by false representation Fraud by false representation is an offence under section 2 of the Fraud Act 2006 (FrA 2006), when read in conjunction with FrA 2006, s 1. The elements of the offence are: • making • a false representation • dishonestly • knowing that the representation is or might be untrue or misleading • with intent to make a gain for the defendant or another, to cause loss to another or to expose another to the risk of loss Fraud by false representation applies to a broad range of conduct. No gain or loss need actually be made, and no deception need actually result from

This Practice Note is archived and is no longer maintained. Sentences for fraud by false representation A person convicted of fraud by false representation in the Crown Court on indictment faces a maximum penalty of ten years imprisonment or a fine or both. The Sentencing Council (the Council) has published separate sentencing guidelines for use in the magistrates' court and Crown Court for sentencing individuals and corporate offenders for fraud (together, the Fraud Guidelines): the Fraud Guidelines are the starting point for advising clients in relation to potential sentences. The Council previously published these offence specific guidelines within the Fraud, Bribery and Money Laundering Offences: Definitive Guideline but has now published them online (and not in PDF or paper format) separately as individual offence specific guidelines for the magistrates’ courts and Crown Courts. These offence specific Fraud Guidelines supersede and replace the Fraud, Bribery and Money Laundering Offences: Definitive Guideline PDF, which has been archived. The Fraud Guidelines apply to all individual offenders aged 18 and older, and to companies, sentenced on or after 1 October 2014,

Arbitration analysis: The English Court of Appeal has held that it lacked jurisdiction to grant permission to appeal against a decision under section 68(2)(g) of the Arbitration Act 1996 (the Act). Section 68 of the Act allows arbitral award to be challenged ‘on the ground of serious irregularity affecting the tribunal, the proceedings or the award’, and section 68(4) restricts permission to appeal from decisions under that section to the first instance judge. This reinforces the Act’s policy of finality and efficiency, by limiting appellate intervention in arbitral award challenges, absent exceptional circumstances. The court rejected arguments that the first instance decision—that the proposed challenge did not fall within section 68(2)(g)-was a jurisdictional ruling falling outside section 68(4). The court found that it was a decision on the merits of the section 68 challenge, squarely within the appeal restriction, and was not circumvented by a consent order that had extended time to seek permission to appeal. Written by Rob Palmer, partner, and Hugo Petit, associate, at Hogan Lovells.

Law360, London: As litigation involving cryptocurrency significantly increases, fraud cases represent a lesser share of the total number of crypto disputes, according to a report published 28 July 2025 by CMS Cameron McKenna Nabarro Olswang LLP.

A fund designed to compensate members of pension schemes where loss arises as a result of an offence (such as theft or fraud) committed after 6 April 1997.

Law360, London: Britain's largest banks have committed to continue to fund a central pot used to reimburse victims of transfer scams after the voluntary scheme was extended by three months.

This Practice Note discusses the following topics: • the ability of parties to raise fraud allegations during the adjudication • when fraud allegations will permit a party to resist enforcement of the adjudication decisions • fraud in the adjudication process itself Special rules apply to fraud allegations in or in relation to adjudication, and to when an allegation of fraud may permit the losing party to say that the resulting decision is not enforceable. Fraud as a defence in the adjudication itself If a party is aware of the relevant facts which support a challenge to a piece of evidence or an argument when the adjudication is running, then it can and should raise it in the adjudication. Fraud can be a defence in adjudication proceedings just as it can be in court or arbitration proceedings—clear and unambiguous evidence must be there to support it in just the same way, and it must be proved sufficiently clearly (and given the seriousness of the allegation, proved on the balance of probabilities to a convincing degree). So, to

Fraud in personal injury claims may include a wide range of behaviour such as exaggerating some heads of damage to the complete fabrication of an accident and the injuries and losses suffered. As to remedies in connection with fraud, the law and practice have been transformed by the coming into effect of section 57 of the Criminal Justice and Courts Act 2015 (CJCA 2015) which has the potential to allow defendants to strike out otherwise valid claims, to exempt the defendants from qualified one-way costs shifting (QOCS) and to vitiate the claimant’s legal expenses cover. See Practice Notes: Personal injury claims and the Criminal Justice and Courts Act 2015 and Qualified one-way costs shifting (QOCS). Duties and responsibilities of parties and legal advisers Pleadings—CPR By CPR 16.5(2), where a defendant denies an allegation set out in the particulars of claim, they must state their reasons for doing so and if they intend to put forward a different version of events from the claimant’s, they must state their own version. For defendants, this means:

Corporate Crime analysis: Jonathan Fisher KC’s report Fraud in the Digital Age (the Report) provides a comprehensive overview of the evolution of fraud, the laws currently in place to legislate against it, and the penalties available. The Report identifies the rapid acceleration of fraud which came with the advent of the internet and then social media, and which threatens to increase exponentially with the proliferation of Artificial Intelligence (AI), presenting unprecedented challenges for law enforcement at the stages of detection, investigation and charge, through to the already overburdened courts. The Report recommends how these difficulties can be addressed with a multi-faceted approach, filling lacunas in the current law, including corporate ‘failure to prevent’ offences, enforcing cooperation with the private sector, expanding regulatory requirements, and improving systems for fraud reporting and whistleblowers. The aim is ‘to make deterrence credible, disruption routine and victim progress visible and to ensure that platforms and payment firms carry a fair share of responsibility’. Alexandra Scott, a barrister at Mountford Chambers, provides her analysis and commentary on the principal findings and recommendations of the Report.

Jonathan Fisher KC’s Fraud in the Digital Age (the Review) is the second and final report from the Independent Review of Disclosure and Fraud Offences. It is the most comprehensive review of fraud law and enforcement in England and Wales since the Roskill Report in 1986. Although the Review concludes that the Fraud Act 2006 (FrA 2006) remains a flexible and effective legislative framework, it recommends significant reform to the wider fraud ecosystem, including new corporate liability for online platforms, improved public-private data sharing, enhanced investigative powers, greater use of artificial intelligence (AI), new fraud-related offences, reform of whistleblower protections and incentives, and changes to court procedures and sentencing. This Practice Note considers the Review’s recommendations and the practical implications these may have if implemented and is designed to help lawyers monitor the progress of fraud law reform. See also News Analysis: Fraud in the Digital Age—assessing Fisher's reform proposals. Why reform is needed Fraud has become the UK's most prevalent crime—potentially accounting for close to half of all offending in England