Plan finalised to close net on fraudsters

PUBLISHED : Tuesday, 16 July, 1996, 12:00am
UPDATED : Tuesday, 16 July, 1996, 12:00am

After almost eight years of internal debate, the Law Reform Commission yesterday published its final proposal that would be the first step in giving Hong Kong a law against fraud.

Legal loopholes which had made it difficult for prosecutors to go after fraudsters under existing laws would be closed if the Government accepted the proposal, commission secretary Stuart Stoker said yesterday.

According to Mr Stoker, commercial crimes cost Hong Kong $120 billion in the past decade, 20 times more than bank robberies.

And he said commercial crime would continue to rise in the coming years, making it imperative to have a fraud law.

'We do not expect to see any decrease in commercial crime. The proposal is designed to improve existing laws,' he said.

Mr Stoker said prosecutors had to rely on fraud-related sections in the Theft Ordinance, or the offence of conspiracy to defraud.

But the conspiracy to defraud only applies to more than one person, making it legal for a single person to defraud with the same act.

Mr Stoker said the sections in the Theft Ordinance were too specific, putting some deception cases outside their definitions.

He cited the examples of information illegally obtained from computer databases, which did not deprive their owners of their property, and bank mortgages received by deceptive means, which were not services. These conditions were required by the sections in the Theft Ordinance.

By only requiring prosecutors to show a person's intention to deceive in an offence of fraud, Mr Stoker said the proposal would close these loopholes.

Clive Grossman, QC, said a fraud law was long overdue for Hong Kong.

'You've got into a ridiculous situation where the statutory offence [of conspiracy to defraud] doesn't look like fraud,' he said.

'The public needs to understand cases of fraud for what they are.' Mr Stoker said it took almost eight years to finalise the report because there were disagreements among members of the commission's committee on the fraud proposal. He said some members even disputed if there was a need to draft a new fraud law.