The world of business and/or commerce operates on the basis
of documents (paper or electronic). It's been this way ever since the merchant
class became literate, and documents took on the quality of expressing legal
rights and obligations. In today's world, we prove important things by producing
documents (e.g., birth certificates, drivers' licenses, titles, invoices, bills
of sale). False documents represent a threat to social
stability and order. They undermine confidence in the authenticity of documents.
Forgery and fraud offenses under Kenya law refer to a variety of criminal
behaviors designed to cheat a person, a business, or government agency out of
their money, goods, or services. This aspect of the criminal behavior --
cheating or deceiving -- is the resemblance between these offenses and
property crime. Indeed, many states don't have separate
fraud statutes; they include such crimes under theft or larceny by fraud
statutes. Another aspect of fraudulent behavior is it's similarity to
white-collar crime. Indeed, because it often involves the
falsification of documents, it's a good example of this, but simple frauds
aren't often committed by persons of high or respectable social status (which
fits the definition of white-collar crime, see footnote below). Another aspect
of forgery and fraud offenses is that they corrupt the
very foundation of public administration and/or government regulation. Think
about the harm done for a moment -- society is really the victim -- all the
people who had a legitimate claim to money, goods, or services will now have to
go without, with less, or burden society more to go with the same in order to
make up for the losses incurred from those who had no legitimate right to the
money, goods, or services. In many ways, forgery and fraud offenses are the
hybrid of all hybrid crimes.
Although most crimes against business are distinguished by
the means used to carry them out, forgery is a specific intent crime while fraud
is a general intent crime. Forgery under Kenya law requires a rather unusual mental state which
easily distinguishes it from other crimes of theft. With fraud, it's sometimes
said that it must always be intentional, as distinguished from negligent, but
there are so many different forms of fraud, spelling out so many different
circumstances, that it's probably better to refer to fraud as requiring
constructive intent.
ELEMENTS OF FORGERY
Forgery under Kenya law is the false making or material alteration of a
writing where the writing has the apparent ability to defraud and is of apparent
legal efficacy with the intent to defraud.
1. False making -- The person
must have taken paper and ink and created a false document from scratch. Forgery
is limited to documents. There can be no such thing as a forgery of art or
forgery of machine because these items are not written documents. "Writing"
includes anything handwritten, typewritten, computer-generated, printed, or
engraved.
2. Material alteration -- Under Kenya laws the
person must have taken a genuine document and changed it in some significant
way. It's the writing itself which must be false, not the document. This element
is intended to cover situations involving false signatures or improperly filling
in blanks on a form.
3. Ability to defraud -- The
document or writing has to at least look genuine enough to fool people.
Forgeries of completely ridiculous things, like titles to swamp land in Florida,
deeds to land on the moon, or a license to kill, do not qualify as having the
apparent ability to fool most people.
4. Legal efficacy -- The
document or writing has to have some legal significance affecting at least
another person's right to something, usually some property right, broadly
defined to include intellectual property like the form of a signature. Legal
significance is distinguished from social significance. A writing of social
significance cannot be the subject of forgery; e.g., a letter of introduction.
Similarly, if you found an old book by a famous author and wrote their signature
inside the front cover to make it look like an autographed edition, you would
not be guilty of forgery because this has social, and not legal significance.
But, if you were to sell the autographed book at an auction, you would be guilty
of false pretenses.
5. Intent to defraud -- The
specific state of mind for forgery does not require an intent to steal,
only an intent to fool people. The person must have intended that other people
regard something false as genuine. A forgery is complete upon having created
such a document with this requisite intent. No use need ever be made of the
document nor does it ever need to be tried out or circulated by the offender
("Possession is 9/10ths of the law"). The test is whether anyone might have been
defrauded.
ELEMENTS OF UTTERING
Uttering a forged instrument is the passing or making use of
a forged writing or document with knowledge of its forged nature. This is the
more usual pattern -- to charge the offender with both forgery and uttering --
because the forgery is used to accomplish some other crime, like false
pretenses, some other property offense, or something as simple as purchasing
alcohol with a fake ID. Falsification of information on employment applications
has also been held to involve uttering.
1. Passing or making use -- This
is any putting into circulation a writing or document that involves forgery. Any
form of material gain may be the motive, but generally financial gain is the
motive, as in the common practice of passing a bad check. Motive is not the
distinguishing factor, however. There must be some legal significance to the
circulation.
2. Intent to defraud -- This is
the same as intent to defraud under forgery law.
3. Knowledge of forgery -- This
is held to exist even in the case of the person passing something without saying
anything, like "This isn't my real name, or there might not be enough money in
the balance to pay this, but can you cash the check anyway?" In other words,
silence (when knowing about something unusual) qualifies as satisfying this
element. Merely attempting to offer something as genuine which is suspected to
be false qualifies as offering or transferring (i.e., uttering).
Bad checks are perhaps the number one
crime problem in the United States. Every day, 1.3 million "bad checks" are
passed, and there's no way for the law enforcement apparatus to keep up.
Therefore, the U.S. has devised a rather unusual mix of criminal/civil law in
this area, allowing businesses to let the person "make good" within a certain
number of days (from 3-7 days) or else they are liable for up to triple the
amount of the check.
ELEMENTS OF FRAUD
Fraud under Kenya law consists of various deceitful means to convert or
permanently deprive a person, business, or government agency of property, goods,
or services. The statutory elements are usually the same as under Theft Law,
although some states have separate fraud statutes that spell out the actus
reus (like "bait and switch") more precisely. Fraud is always intentional
(fraudulent intent), intentional by appearance (constructive intent), or
intentional by inference from the act (general intent).
The investigation of fraud, like public order offenses, often
requires law enforcement to engage in certain unethical practices, like
infiltration, entrapment, and sting operations. The variety of fraud offenses is
sometimes amazing, and constantly growing. They also vary in their levels of
sophistication. Here's an alphabetical list of the more common frauds under Kenya law:
-
Bank fraud -- When customers are told their saving accounts are invested in one place when they really are in another place
-
Consumer fraud -- When homeowners or shoppers are sold services or goods they don't really need
-
Contract fraud -- Taking advantage of government procurement procedures, bidrigging, bribes, or kickbacks
-
Insurance fraud -- Falsely claiming lost, damaged, or stolen property in order to receive insurance settlements
-
Mail fraud -- Use of the U.S. mails for fraudulent purposes
-
Pyramid Scheme fraud -- Multi-level marketing ploys in which employees must recruit other investors or employees
-
Stock Market fraud -- Inside trading or investment in start-ups to make fortune overnight in a public offering that never occurs
-
Telemarketing fraud -- High pressure phone calls to buy now before its too late or other bargain tricks
-
Welfare fraud -- Receiving benefits when one is not eligible
FOOTNOTE: WHITE-COLLAR CRIME
[definition:] Planned illegal or
unethical acts of deception committed by an individual or organization, usually
during the course of legitimate occupational activity by persons of high or
respectable social status, for personal or organizational gain that violates
fiduciary responsibility or public trust. (Proceedings of
the Academic Workshop 1996; Morgantown, WV: National White Collar Crime Center)
This table gives an overview of
"sophisticated" (Albanese 1999) crimes:
Conspiracy:
|
White Collar Thefts:
|
Crimes against Public Admin:
|
Regulatory Offenses:
|
Cyber- Crimes:
|
Organized Crime:
|
| Crimes of planning and organiz. | Embezzle- ment, extortion, forgery, fraud |
Bribery, perjury, obstruction of justice | Labor, trade, manufacture, environment violations | Damage, alteration, threats, theft | Illicit services, infiltration |