^{Session 2: Fraud and Related Offences}

Case Scenario 

Background

Mr Ocean is the sole director and shareholder of Best Builders Co Ltd (Best Builders) that conducts business in a province in your country. 

Each year the province is allocated funding by the national government for development projects under its annual budget. At the beginning of 2021 Mr Ocean applied for and was awarded a one-year contract in the sum of $3 million by the Provincial Tenders Board, to renovate and maintain the Provincial Health Centre which is unable to meet the needs of the growing population.

The manager of the Provincial Health Centre complains to police in July 2022 that no work has ever been done on the centre, but he has seen Mr Ocean driving around town in a new car and wearing fancy clothes. 

Investigations reveal that between 1 March and 1 August 2021 a total sum of $3 million was paid to Best Builders.

Records obtained from the Provincial Treasury Office show that six requisitions authorising payments in the amount of $500,000 on the first of every month during the period were approved by the Provincial Administrator as the Authorising Officer under the Public Finance Management Act. 

Attached to the requisitions in each case is a letter signed by Mr Ocean requesting payment under the terms of the contract. No other documents, reports, invoices, or acquittals are filed with the requisitions.

Under the Financial Guidelines made under the Public Finance Management Act, the Provincial Administrator has financial authority to approve requisitions up to a maximum of $500,000. 

An officer from the Office of Auditor General produces the Financial Guidelines under the Public Finance Management Act. 

Under the Guidelines, once requisitions are approved by the authorising officer, they are passed to the accounting officer for examination and certification. Examination is the process of confirming that the requisitions are supported by appropriate documentation. Certification is the process of confirming that sufficient funds are available in the province’s account. 

Bank records show that the cheques drawn payable to Best Builders on the provincial treasury account are paid into the company’s bank account, to which Mr Ocean is the sole signatory. Within a few days of each deposit the bank account is reduced to almost nil. Most of the monies are transferred to Mr Ocean’s personal bank account. 

As director of the company, Mr Ocean says he was entitled to do with the monies what he wanted as long as the company delivers on the contract. The company started work on the centre but is waiting for supplies to arrive, which have been delayed because of COVID. In any event, the State can’t show how he ultimately used most of the money. 

Scenario Exercise

Question 1

The accused does not dispute the facts alleged but denies any wrongdoing. 

• Did Mr Ocean apply the monies to his own use? 
• Did Mr Ocean do so dishonestly? 

Question 2

Assume instead that the accused is charged with one count of obtaining property by false pretence or deception. 

• Did Mr Ocean obtain the property as a result of false pretence or deception? 
• If so, what was the false pretence or deception?