Abstract: The article deals with fraudulent behaviour in private relations and the possible threat of criminal sanctions for perpetrators of such acts. The author discusses the recently evolving implementation of the "mandatory caution" rule, which has led to an increase in the number of suspended criminal proceedings in the Slovak Republic and the Czech Republic in recent years. In many cases, a victim's failure to exercise "mandatory caution" could lead to the non-prosecution of a perpetrator of a fraud, which formally meets all of the necessary attributes of a crime. This article strives to initiate international discussion on whether such practice or a similar form thereof should spread throughout the European countries and should be generally accepted or whether it should be rejected as an unfair practice which infringes on the rights of victims and contravenes the basic principles of a legal state and the duty to protect citizens against crimes and to convict and sentence their perpetrators.
Every day, certain individuals search for new ways to deceive their victims, to disguise their unfair intentions with new tricks, and to present their illegal activities as "legal". It is commonly known that the criminals are "one step ahead" of their victims and devise fraudulent practices that appear to be reasonable to the unwitting, especially the very young and the very old. They are very often successful because they can always find vulnerable people who are not familiar with this "type" of fraud.
They are constantly on the lookout for such unsuspecting and unskilled victims. Usually, these victims detect the "fraud" after the fact, when they have already lost money without the chance to recover it. After realizing that they have been defrauded, the perpetrator stops communicating, doesn't answer phone calls or emails and cannot be found at the address provided to the victim. At that point the victims are very likely go to the police to file a criminal complaint in the hope that the police, prosecutors and courts will punish the perpetrator and recover the money. However, the reality is often different. In Slovakia, such proceedings are often suspended pursuant to Art. 197 sec. 1 letter d/ of the Criminal Procedure Code[2] or Art. 215 sec. 1 letter b/ of the Criminal Procedure Code. [3] In the Czech Republic such proceedings are often suspended pursuant to Art. 159a sec. 1 of the Czech Code of Criminal Procedure.[4] The "act" which is the subject of a criminal complaint is not a crime because the victim did not exercise "mandatory caution", in other words, they were "too stupid". They should have been more careful, and it was "their fault" that they were cheated by the perpetrator. Thus, they have no right to protection against such criminal conduct. Most victims are confused and cannot understand why the State doesn't protect them and lets the perpetrator go free. This article introduces the implementation of the "mandatory caution" rule and discusses whether this is the correct way to deal with criminal conduct in certain cases of fraud.
"Mandatory caution" is a rule formulated in case-law whose fundamental principle is the following: everyone should follow the basic rules of prudence and protect themselves from becoming the victim of an obvious and easily detectable crime. This idea was developed in the case law of the Supreme Court of the Slovak Republic (hereinafter referred to as the "Slovak Supreme Court") and the Supreme Court of the Czech Republic (hereinafter the " Czech Supreme Court"[5] and has evolved by dealing with conduct that shows signs of different types of fraud.[6]
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Fraud includes the intention to "mislead the injured person" or "use his/her mistake for the profit of the perpetrator or a third person". However, not every practice of misleading another person should be classified as a crime. Indeed, each person is obliged to exercise a minimum level of caution in the protection of their own interests, especially if the error is obvious. This rule is stipulated e.g. in Decision 2To V 21/2014 of the Slovak Supreme Court, dated 4 February 2013:
"The common ground of fraudulent conduct lies in the "mistake" of another person (a person other than the perpetrator). A mistake as a contradiction of the notion of reality in terms of the facts of the crime of fraud must have a certain "quality" (not every false statement is sufficient) and must be a means of deceiving another in a particular situation. However, if the person disposing of property has an obligation (by law, contract or custom) to examine the statements of others, by means normally available and, in similar cases, commonly used, it is not possible to merely state an "untruth" and classify it as a "mistake" in the sense of the offense of fraud. In the case under consideration, the "untruth" is not the kind that cannot be recognized and the person disposing of property is not objectively able to eliminate a possible mistake at a certain time and condition. In this case, it is also necessary to take into account the "mandatory caution" of a person who is misled or whose error the offender wants to benefit from.[7]
This legal rule has particularly developed with regard to the filing of criminal complaints by persons who have entered into obviously risky and unsecured transactions that offer the possibility of high profits. This was the courts' response to the huge number of criminal complaints which shifted the burden of proof of damage of private subjects to law enforcement bodies in criminal proceedings, in cases where the damage was due to the victims' irresponsible approach towards protecting their own interests. In such criminal proceedings, damaged persons and companies sought compensation for damages at the expense of the State which had to bear all of the costs of criminal proceedings, however at no expense for the damaged subject which did not need to pay for civil legal proceedings, court fees, legal representation, etc.
The new "mandatory caution" rule should diminish these practices because according to this case-law, "the failure to exercise the normal "level of caution" in private law relations excludes the conclusion of the commission of a crime of fraud. "[8] As stated in the Opinion, "the indication of false facts cannot in itself be regarded as "misleading" in the meaning of the fundamental features of the offense of fraud, because a mere "untruth" says nothing about whether such false statements were even objectively capable of deceiving the injured person."[9]
We also refer to the need for mandatory caution in Slovak and Czech literature:
"Not every misrepresentation fulfils the statutory features of the crime of "fraud". It must be a misleading act that cannot be revealed as an untruth when exercising ordinary caution. At the same time, the untruth must be substantial in the legal relation between perpetrator and the victim and must be the main source for the act or decision of the deceived person. ... If the victim himself, by his apparent carelessness, which he could have easily avoided, made a risky financial transaction and spent money, the consequences of this act must also be dealt with by private law. A poor quality, i.e. a recognizable lie, or an insignificant lie, should not be considered a socially harmful act and therefore not a criminal act, in a particular situation and taking into account a deceptive subject."[10]
"If it was clear that a person had the opportunity to detect the error in a commonly available manner and then rectify it, but did not, he/she should be liable for the consequence itself and forced to seek protection of his/her rights by non-criminal means."[11]
In applying criminal liability for any act of fraud, the ability of the person to be 'deceived' (i.e. taking into account all of the circumstances of the case) must be considered in order to assess whether the factual misrepresentation was capable of deceiving that particular person. As a result of the formulation of this principle, many criminal complaints about the crime of fraud are rejected (postponed, suspended) on the grounds that the act was not a criminal offense because the deceived person did not exercise a basic level of caution. In this case, the victim is the one who must bear the entire negative effect of the resulting offender's conduct, because his/her conduct was the main cause of the act.
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The purpose of criminal liability is to punish the perpetrator according to "his/her fault" (Art. 34 sec. 4 of the Criminal Code of the Slovak Republic, Article 39 sec. 2 of the Criminal Code of the Czech Republic). Impunity in the meaning of the idea of mandatory caution is based on idea that the fault of the offender is reduced by the extent of the victim's responsibility. Criminal law in Slovakia directly assumes that offenses take into account the degree of culpability, which may also result in the impunity of the offender - "It is not an offense if, due to the way the act and its consequences, and the circumstances in which the offense was committed, the degree of culpability and the motive of the offender and its gravity is negligible." (Art. 10 sec. 2 of the Criminal Code of Slovakia). We could derive this rule from the wording of Art. 12 sec. 2 of the Criminal Code of the Czech Republic: "The criminal liability of the offender and the related criminal consequences can only be applied in cases of social harm in which liability under other laws is not sufficient."
It is clear that the fault of the injured party forms an important part in establishing the offender's liability for his unlawful conduct, which, even if it bears formal features of an offense, will not be punishable due to the fact that such act was of minor gravity with regard to the perpetrator's fault. This fault is appropriately reduced if the injured party has caused his/her harmful effect or cooperated in its creation.
However, we can also find opponents of "mandatory caution" who claim that it is impossible to clear someone of criminality simply because the injured person failed to exercise the usual caution. Indeed, the omission of the injured person does not change the nature of conduct of the offender who deliberately makes false statements in order to mislead the victim. The important issue in this case is whether the offender knew that the statements were false and his intention to make these false statements appear to be true. In such case, if the victim finds that such information is false, it would not exclude the possibility of a penalty for the perpetrator for the crime of "fraud". According to the opponents of the concept of "mandatory caution", the offender's conduct cannot be assessed solely on the basis of the injured party's behaviour. Making false statements in order to mislead another person fulfils the elements of the crime of fraud, and thus, such elements do not vanish simply because of the negligent conduct of the victim. A criminal offense in terms of legal provisions should be assessed solely on the basis of the perpetrator's conduct.[12]
The "mandatory caution" rule was cited in the following cases in Slovak Republic as the reason for not initiating criminal proceedings.[13]
According to a credit agreement with the injured party, the accused was granted a loan; however, when the accused did not make the repayments, the injured party filed a criminal complaint. Although the accused submitted a confirmation of employment dated 07/08/2014, at the time of the conclusion of the credit agreement he was aware that in his employment would end on 15/08/2014 and thus he provided false and misleading information about his creditworthiness and ability to repay the loan. The accused also included in the loan application the telephone contact of the employer, where it was possible to verify the veracity and completeness of the information regarding his employment. In the context of his credit agreement, the injured party had the opportunity to examine the circumstances regarding the assessment of his future client's creditworthiness and to assess his ability to repay the loan. However, since he failed to do so, the complaint was rejected due to his failure to comply with the rule of "mandatory caution".
The citing of "mandatory caution" could be accepted in this case. It should be pointed out that any business activity, including the provision of loans, is by nature risky, with risk being an integral part of market relations. The Criminal Code does not provide protection against the negative consequences if an entrepreneur (creditor) does not correctly estimate the risks, or fails to secure his business relations through
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appropriate legal instruments and suffers damage because of the insolvency of his business partner (debtor). It would be absurd to penalize any risk in the business environment by the instruments of criminal law. In the above mentioned case, it was the obligation of the injured party to make the necessary effort to check the documents submitted by the accused. The information available for the decision to grant the credit was available and the creditor was in the position to eliminate the damage by adopting appropriate measures. Credit product companies that regularly come into contact with the disclosure of false information as part of their business activities have the opportunity to review the declared data and, while maintaining a level of caution, recognize the falseness of a claim without making special efforts.
A young woman wanted to buy a car advertised by a private person on a web portal. Although the pictures of the advertisement contained a car with a Slovak license plate, the seller stated that he had taken the car to Germany, and offered to "send the car to Slovakia by a courier company". He communicated with the buyer in German and solely via email; he did not respond to telephone calls. He sent the buyer a scan of "his" driving license and identity card, which indicated that he was a German national. Based on this information, the buyer sent the money for the vehicle to the bank account in a Spanish bank specified by the seller, expecting that "her" car, which she had never seen before, would be delivered by a courier company. She never received the car, and when she tried to recover her money, the seller stopped communicating with her.
The invocation of "mandatory caution" was reasonable in this case. It is generally known that online transactions are risky because persons communicating over internet have many possibilities of concealing their identity and usually do not need to verify their data when creating mailboxes or user profiles on particular internet portals.
Despite her relatively young age, the buyer had grown up when the use of internet was well established and used by children in elementary school. Buying a motor vehicle is also a relatively frequent legal act carried out by persons of all age categories. Even if the victim was buying a motor vehicle for the first time, it is an important and serious transaction that she could have discussed with relatives, acquaintances or competent persons to avoid mistakes. Buying a car over internet in the form of "courier delivery" without the prior physical inspection of the vehicle indicated the dishonesty of the procedure and the seller. In addition, despite the fact that the vehicle was registered in the Slovak Republic, she communicated with the suspect - the alleged owner - in German. The fact that a person with a vehicle registered in the Slovak Republic did not speak Slovak should also have raised suspicions. As the victim herself stated, it was not possible to contact the suspect at the telephone number listed in the advertisement, which was another warning sign. Furthermore, the indication of a Spanish bank account, although the seller should have been in Germany and should have been a German, is a circumstance which indicated that it was a speculative and suspicious sale in which the seller probably used false documents to deceive the buyer. It was an obviously non-standard situation, which the buyer, despite her age and experience, should have assessed as being too risky. She should not have entered into such contractual relationship and she should not have carried out any financial transaction in this situation.
According to these circumstances, it was not acceptable to carry out a costly investigation to identify the perpetrator of the offense, since the injured party herself could have relatively easily eliminated the negative consequences of this transaction by considering the potential risk of this action and not sending her money to an untrustworthy person with a questionable identity. The victim voluntarily sent financial funds to an unknown account owned by an unknown person; since she decided to spend her funds in this risky transaction, it could not be said that she was "misled". She must have been aware that the delivery of the requested vehicle or the repayment of her funds was not ensured under such circumstances. She must have been at least indirectly aware of all of the risks of this transaction.
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The accused suggested to a young man with a disability that he knew about a good job which he could arrange for him. The accused stated that he had to make certain payments in advance for medical documentation, certificates, work clothes, etc.) and to conclude contracts with 2 telephone operators (the accused took delivery of the telephones and SIM cards and stated that they had to be properly set up by the employer). The entire 'employment" communication with the victim was made via telephone or email by unknown persons and the injured party received a contract of employment with specific terms and conditions via email. Later, the accused and other persons stated that the starting date would be delayed until additional fees were paid, and they sent the injured party a new version of the employment contract with a later starting date. Despite the suspicious circumstances, the victim still sent the money. When his job was not finally started and his money was not returned, he filed a criminal complaint. The criminal complaint was rejected on the grounds that the victim did not exercise an appropriate level of caution.
In this case, the invoking of "mandatory caution" was dubious. In particular, the victim was not interviewed to establish his capability of understanding the level of fraud of this procedure or his experience in private legal relations, especially related to labour law contracts. Thus, the extent to which the fraudulent conduct of the accused evoked the impression of credibility and the extent to which an ordinary person could have believed that this was a serious approach and common practice in the field were not examined. Indeed, if it were found that the fraud had a sufficient degree of "credibility", the rule of "mandatory caution" would not have been invoked.
In view of these findings, it should be pointed out that the rule of impunity for the perpetrator due to the victim's failure to exercise "mandatory caution" may not be invoked for all potentially fraudulent acts.
In this respect, it is necessary to point out decision 3Tdo 15/2014 of the Slovak Supreme Court, dated 3/12/2014:
"Compulsory caution should always be considered within the real situation of the case, taking into account the injured party (age, life experience, status in society)."[14]
This position is also supported by Czech literature: "However, the invocation of impunity cannot always be as clear and must be performed in relation to the individual circumstances of the act."[15]
If we accept that when considering any fraudulent action we must take into account the victim's apparent carelessness and often conclude that such act shouldn't actually be a crime, it would be a signal to all perpetrators that if they find enough naive "fools" to be misled, their acts will go unpunished.
We have to take into account the fact that not everyone has the same level of education, intelligence, experience; some people come from a rural environment which does not provide them with enough savvy to see through the frauds that wrongdoers are preparing for them. In these cases, more extensive information about the victim must be obtained. For example, natural persons are often less experienced and have fewer opportunities to obtain information about their contractual partners as opposed to persons representing financial companies that deal with fraudulent conduct on a daily basis. It is therefore necessary to deal with injured persons individually and not to invoke the rule of "mandatory caution" in all cases.
In a certain case, the Slovak Supreme Court did not invoke the rule of "mandatory caution" stating "in this case the person without any legal education or the necessary experience with the transfer of real estate was harmed. At the time of signing the contract, the victim was in a difficult life situation (she was suffering from an illness and her husband had recently died). Thanks to his contacts with her family through his girlfriend K., the accused knew of the distressed situation of the victim, her naiveté and lack of legal experience and deliberately misled her by concealing facts related to the sales contract."[16]
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Law enforcement authorities may be tempted to reject a criminal complaint where the investigation appears to be problematic or time-consuming by citing the "failure of the victim to exercise mandatory caution". Therefore, when in doubt, it is reasonable to initiate criminal proceedings against the accused, as invoking "the failure to exercise mandatory caution" in questionable cases could "favour" the offender and "harm" the victim. The question of "non-compliance with mandatory caution" should be resolved after assessing all of the facts of the case and only after sufficient evidence has been taken.
We will see the further evolution of this rule in Slovak Republic and Czech Republic in context with other neighbouring countries and EU members. It is possible that a similar rule will be adopted in other countries. On the other hand, the case law of other countries could influence Slovak and Czech law enforcement bodies to change this rule and again prosecute all acts that have features of fraudulent acts. This rule could also encourage wider expert discussion on how to perceive a crime and the borders that we should take into consideration when prosecuting the perpetrators of crimes.
The article offered a brief look at the rule of "mandatory caution" which was recently implemented in Slovakia and the Czech Republic, it also and introduced examples of actual cases where it was invoked in Slovakia.
This rule has followers and opponents. In some cases, the invoking of this rule is acceptable, in some cases it is not acceptable. The carelessness of the injured party cannot automatically be assessed as the failure to exercise mandatory caution; such a decision must be arrived at by considering other relevant facts and taking into account all of the circumstances of the case. ■
NOTES
[1] This article was supported by the scientific project APW 15-0740 of the Slovak Research and Development Agency.
[2] Act No. 301/2005 Coll. - Criminal Procedure Code as amended.
[3] Act No. 141/1961 Coll. - Criminal Procedure Code as amended.
[4] e.g. Decision 2Tdo V21/2004 of the Supreme Court of the Slovak Republic, dated 4/2/2013 or Decision 7Tdo 461/2007 of the Supreme Court of the Czech Republic, dated 25/4/2007 or Decision. 7Tdo 486/2010 of the Supreme Court of the Czech Republic, dated 25.5/2010
[5] In the Slovak Criminal Code, Art. 221-225 Act No. JOO 2005 Coll. - the Criminal Code as amended), in the Czech Criminal Code, Art. 2 (lP- 212 (Act No. 40/2009 Coll. - the Criminal Code as amended)
[6] In the Slovak Criminal Code, Art. 221-225 Act No. JOO 2005 Coll. - the Criminal Code as amended), in the Czech Criminal Code, Art. 2 (lP- 212 (Act No. 40/2009 Coll. - the Criminal Code as amended)
[7] Judgement of the Supreme Court of Slovak Republic, 2Tdo V 21-20 4, dated 4/2/2013.
[8] Opinion IV/1 Spr 434/15/1100 of the prosecutor of the Criminal Law Department of the General Prosecutor's Office, dated 7/12/2015, p 6.
[9] Opinion IV/1 Spr 434/15/1100 of the prosecutor of the Criminal Law Department of the General Prosecutor's Office, dated 7/12/2015, p 7.
[10] Kuchta, J.: Kněkterým pojevúm zásady potupené úlohy nestni represe v oblasti hospodárskych a majetkových trestných činil. In: Majetkové a hospodárske trestné činy včera a dnes, zborník príspevkov z konferencie. Spisy Právnické fakulty MU, rada teoretická. edice Scientia. Vol. 558. Masaryk University Faculty of Law, Brno 2016. p. 238-239.
[11] Hamranová, D.: Uplatňovanie princípu ultima ratio a zásady subsidiarity trestnoprávnej represie v majetkovej kriminalite. In: Majetkové a hospodárske trestné činy včera a dnes, zborník príspevkov z konferencie. Spisy Právnické fakulty MU. rada teoretická. edice Scientia, sv. č. 558. Masaryk University Faculty of Law, Brno 2016. p. 325.
[12] Opinion IV/1 Spr 434/15/1100 of the prosecutors of the Criminal Law Department of the General Prosecutor's Office, dated 7/12/2015, p. 7.
[13] Based on true cases and true decisions from the District Office of prosecutor in Malacky, Slovakia from the years 20172018.
[14] Decision 3Tdo 15/2004 of the Supreme Court of the Slovak Republic, dated 3/12/2014
[15] Kuchta, J.: Knekterým projevúm zásady pomocné úlohy trestné represe v oblasti hospodárských a majetkových trestných činú. In: Majetkové a hospodárske trestné činy včera a dnes, zborník príspevkov z konferencie. Spisy Právnické fakulty MU. rada teoretická. edice Scientia. Vol. 558. Masaryk University Faculty of Law, Brno 2016. p. 239.
[16] Decision 3Tdo 15/2014 of the Supreme Court of the Slovak Republic, dated 3/12/2014
Lábjegyzetek:
[1] The Author is Associate Professor, Department of Criminal Law and Criminology, Faculty of Law, Comenius University Bratislava, Slovakia.
Visszaugrás
