The Offence of Fraud

Under Article 157 of the TPC, fraud can be described as deceiving a person through fraudulent conduct and, as a result of that deception, causing loss to that person or another while the perpetrator or a third party obtains an unlawful benefit. The subject matter of the offence is an item of economic value, which may take the form of money, movable or immovable property, a claim, or another type of benefit.

The law does not expressly define what qualifies as fraudulent conduct, so whether a given act is deceptive must be assessed on the facts of each case. In practice, factors such as the victim's age, education, experience, and circumstances are taken into account when determining whether particular conduct was deceptive in nature.

The objective elements of the offence include the perpetrator, the victim, the fraudulent act, the resulting deception, the loss suffered by the victim or a third party, and the benefit obtained by the perpetrator or another person. A causal link must exist between the fraudulent conduct, the victim's resulting mistake, and the transfer of an asset that follows from it.

As for the mental element, fraud can only be committed intentionally; it cannot be committed through negligence. The perpetrator must act with the awareness and intent to deceive the victim through fraudulent conduct in order to obtain an unlawful benefit for themselves or another.

The basic offence of fraud under Article 157 carries a penalty of one to five years' imprisonment and a judicial fine of up to five thousand day-units. Where within that range the actual sentence falls is determined by the court based on factors such as the intensity of the perpetrator's intent, how the offence was committed, and the severity of the loss suffered by the victim.

Article 158 of the TPC provides for a heavier penalty where fraud is committed under certain specified circumstances. Some of the aggravated forms listed in the law include:

• Committing the offence through the use of information systems, banks, or credit institutions as a means
• Using public institutions, public professional organizations, political parties, foundations, or associations as a means, or committing the offence to their detriment
• Exploiting a victim's religious beliefs or sentiments
• Exploiting a victim's difficult or dangerous circumstances, or a diminished capacity for perception
• Committing the offence by a merchant or company executive in the course of commercial activity, or by someone acting on behalf of a company in that capacity
• Committing the offence for the purpose of obtaining insurance proceeds

Where one of these circumstances is present, the applicable penalty is two to seven years' imprisonment together with a judicial fine of up to five thousand day-units. Which aggravated form applies to a given case is a technical question that depends on the evidence in the file and how events unfolded.

Prosecution of fraud is not, as a rule, conditional on a complaint; the public prosecutor may open an investigation on becoming aware of the offence. Certain specific grounds for personal impunity or a reduced penalty set out in Article 167 of the TPC do, however, make investigation and prosecution subject to a complaint in those particular situations.

Because fraud is subject to the effective-repentance provisions of Article 168 of the TPC, it falls outside the scope of the conciliation procedure under the Code of Criminal Procedure. The statute of limitations for prosecution is eight years for the basic offence and fifteen years for its aggravated forms.

Article 168 of the TPC allows for a reduction in penalty where the perpetrator fully compensates the loss arising from the offence, either before the investigation is concluded or, at the prosecution stage, before judgment is rendered. The extent of the reduction varies depending on the stage at which effective repentance is shown.

The competent court for both the basic and aggravated forms of fraud is generally the Criminal Court of First Instance. The court with territorial jurisdiction is the court of the place where the offence was committed - that is, where the perpetrator or a third party obtained the unlawful benefit.

Anyone facing a fraud allegation, or who has been the victim of this offence, may benefit from working with an İzmir criminal lawyer during the process of gathering evidence and preparing a defense. Support in criminal law matters is provided across İzmir, particularly in Karabağlar, Konak, Buca, and Balçova.

Av. Mehmet Yücesoy

İzmir Attorney & Legal Consultancy