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Fraud by failing to disclose information

ss.1 and 3Fraud Act 2006

Dishonestly failing to disclose information you are under a legal duty to disclose, intending to make a gain or to cause loss or a risk of loss to another.

Fraud by failing to disclose information · Fraud Act 2006, ss.1 and 3Card 17 / 85

Points to prove

Dishonestly
Failed to disclose to another person information
Which they were under a legal duty to disclose
Intending, by failing to disclose the information, to make a gain for themselves or another, or to cause loss to another or expose another to a risk of loss

Key definitions

Dishonestly – not defined in the Act. The test is Ivey v Genting (2017), applied in R v Barton and Booth (2020): the defendant’s actual knowledge or belief, then whether the conduct was dishonest by the standards of ordinary decent people.
Legal duty to disclose – not defined in the Act. It can come from statute, the express or implied terms of a contract, the custom of a trade or market, or a fiduciary relationship. A moral duty is not enough.
Gain and loss – s.5: only gain or loss in money or other property, whether temporary or permanent. Gain includes keeping what you have; loss includes not getting what you might get.

Good to know

No gain or loss has to actually happen. The offence is complete when the dishonest failure to disclose happens with the required intent.
Examples: failing to tell an insurer about a medical condition or previous claims when the policy requires it, or a solicitor failing to tell a client about information they are bound to share.
Where someone actively says something untrue, fraud by false representation (s.2) is usually the better fit. Section 3 is about silence where there is a legal duty to speak.

Legislation: Fraud Act 2006, ss.1 and 3 (opens legislation.gov.uk in a new tab)
Mode of trial: Either way
Maximum penalty: 10 years' imprisonment and/or a fine (on indictment)