After Manchester police refused to prosecute, estate agent Stephen Laycock has now successfully won private prosecution case against a former colleague that cost him £400,000 and jailed Timothy Shinners for three years.
What is a private prosecution for fraud?
A private prosecution for fraud is a criminal prosecution brought by individuals or companies that are the victims of crime and public prosecuting authorities are unwilling to act. Individuals and companies have the right to bring a private prosecution under section 6 (1) Prosecution of Offences Act 1985.
The main fraud offences are in the Theft Act 1968 and the Fraud Act 2006. To prove a fraudulent offence has been committed, it is necessary to show that that a person acted dishonestly, intending to make a gain for himself or another or cause loss to another.
Timothy Shinners was a former business partner of Mr Laycock’s who runs Platinum Properties in Horwich, Bolton. Shinners acted as a director of Platinum Properties between 2009 and 2009.
Shinners was accused of stealing tenants’ deposits and taking funds from the firm’s bank account to fund personal holidays. It was discovered that Shinners failed to pay peoples deposits into the protection scheme as required and spent £80,000 of the cash.
Mr Laycock honored that the deposits Shinners was required to have protected with £30,000 of his own money – an action praised by the judge. Shinners was finally found guilty of two counts of making false representations to cause loss to another, two of making articles for use in fraud, and carrying on the business of a company with intent to defraud the creditors.
The claimant is likely to recover the majority of his legal costs
To fund the prosecution following the failure of the Manchester Police department Mr. Laycock took out a loan of £400,000.
Initially Laycock was told that he would only receive £150,000 of the £427,909 private prosecution costs, however has now won a High Court ruling of the sums to be reassessed.
High Court Judge Mt Justice Lane explained why he more favourable to the costs being reassessed explaining that ‘private prosecutions would be in danger of becoming the preserve of those with deep pockets’.
Are private prosecutions for fraud cost effective?
Yes, a private prosecution for fraud can also be a cost effective solution to recovering any sums fraudulently taken. The state bear the cost of investigating and prosecuting a fraud offender during a public prosecution. In addition, if a private prosecutor is unsuccessful, it is unlikely that the court will make a costs order against the prosecutor if the case was conducted diligently and carefully. In this case, the Defendant would be entitled to compensation from central funds.
However, for a private prosecution it is also possible for a Court to order payment out of central funds to compensate a private prosecutor to recover a significant proportion of their legal costs.
Why was a Private Prosecution the only option?
Stephen Laycock initially contacted the Manchester Police to handle the fraud that had been committed, however they chose not to prosecute Timothy Shinners giving the explanation that “Due to the volume of fraud cases reported, sadly it isn’t possible for every crime to be investigated due to the time and demand on our resources.
“In September 2015, we received a report of fraud which was assessed by our team. Recognizing that there was a limited prospect of GMP securing a successful criminal prosecution due to its limited and already stretched resources, it was decided that this investigation would not be proportionate.”
Why commence a private prosecution for fraud?
To get justice for criminal offences committed against victims that have not been taken on by the police, CPS, the Serious Fraud Office (SFO) (investigation of serious and complex crime) or HMRC (investigate tax fraud). The media have reported that private prosecutions are on the increase due to police and CPS budget cuts which has limited the ability of the enforcement agencies to investigate and prosecute crime effectively. These cuts have created a trend among individuals to fund their own criminal actions against fraudsters due to a failure of the police to investigate or the CPS’s unwillingness to press ahead to trial.
If an offence under the Fraud Act 2006 is not the priority of the CPS, then private prosecutions are a necessary tool allowing a victim to take control of proceedings and actively pursue a conviction against the fraudster.
Some victims of fraud feel that civil proceedings may be prohibitively slow and a private prosecution would offer a speedier resolution. In addition, the civil damages awarded may not adequately compensate for the harm suffered whereas private prosecutions have the availability of tougher penalties which includes unlimited fines and imprisonment.
Many corporate entities have launched private prosecutions having been victim to fraud, rather than leave their rights to be protected by public law enforcement agencies.
Victims of crimes consider starting a private prosecution for a number of reasons, for example:
- to deter future criminal conduct by the suspect;
- to send a clear message to potential fraudsters that a company that has been defrauded will take strong action;
- as a necessary tool when the public prosecution authorities are unwilling to act;
- potential compensation for the victim.
- to establish a precedent for future conduct;
- to protect society; and
- a private prosecutor can access specialist expertise which many public prosecuting authorities cannot utilise, which can increase the chances of prosecution.
The Private Prosecution Service: Experts in helping individuals and corporates prosecute fraud
The Private Prosecution Service [“PPS”] is a leading legal services provider that specialises in providing high quality legal advice to businesses, governments, government organisations and individuals. Private prosecution cases for fraud are our expertise. Private prosecutions can be a powerful, speedy and clinical means of obtaining justice from a fraudster. It is important to have as much evidence to hand for a private prosecution as the traditional law enforcement agencies have powers to gather evidence that are not available to private prosecutors.
Our expert team of prosecutors are experienced at advising on potential strategies and skilled at targeting the evidence needed to prove a fraud conviction and are experts in ensuring whatever evidence is available is admissible in any subsequent criminal proceedings.
We are the only law firm to operate from professional legal chambers located in the ancient Middle Temple (Inn of Court), near the Royal Courts of Justice and in the legal heart of Central London. Our team of lawyers, which comprises a mixture of solicitors and barristers, provide a first class and comprehensive legal service to help you get justice.
For the best Private Prosecution Lawyers in London call 02071830529 or email .