At Investigation Counsel, we are often asked either to bring a criminal prosecution, or to assist clients in making a fraud complaint to the police. Where an individual or company wishes to have a criminal charge of fraud laid without reporting the matter to the police, the process is known as a private prosecution. Where an individual or company wishes to make a criminal complaint to the police, they are often surprised to learn that the police are frequently slow to investigate and expect that complainants conduct their own investigations before reporting the matter to police.
Reporting Fraud to the Police
In most major Canadian cities, the police receive more fraud complaints than they have resources to investigate. It is common to hear that while a complaint may be received by an intake officer, if the matter involves any complexity, it will not be investigated for months, if not for more than a year. Furthermore, fraud complaints are prioritized by the social vulnerability and social prominence of the victim and the value of the fraud. In other words, frauds against seniors, governments, and banks, and / or frauds of $1M or more are given higher priority than frauds valued at less than $1M committed against a small to medium sized business or against a private citizen.
In order to increase the chance that a fraud complaint will be investigated by the police with some expediency, or at all, it is generally expected that individuals and companies will provide police with a completed investigation. What this means is that witness statements should be taken and financial data organized into a coherent brief. A synopsis explaining the fraud should be provided to summarize the matter. If police are satisfied that they have been provided with a thorough investigation, they may make their own inquiries to verify the facts that they have been provided, and then consult with the Crown as to whether charges should be laid.
In many cases, criminal fraud prosecutions stall at the Crown review stage. Often Crown Attorneys will not provide the police with the approval to lay charges, notwithstanding what the police may think of the strength of the case. This occurs because many Crown prosecutors simply do not take the time to understand fraud cases, and do not want to deal with the complexities involved in this type of prosecution. Many Crowns refer to frauds as merely ‘civil’ matters. Thankfully, in some jurisdictions such as Toronto, a specialized unit of fraud Crown prosecutors has been assembled to address this issue. In those cases where the police advise that they are not able to obtain Crown approval to proceed with charges, or where they themselves do not wish to process a fraud complaint, individual victims may still seek justice through private prosecutions.
A private prosecution is the process by which an individual, on his or her own behalf or on behalf of his or her company, swears evidence before a justice of the peace with respect to the elements of a criminal offence they wish to have prosecuted. If the justice of the peace is satisfied that there are sufficient grounds for a charge to be laid, the justice shall process an ‘Information’ (the document that commences a criminal process) and refer the matter to a hearing before a judge who shall consider whether to compel the attendance of the accused in order to answer the charge.
If a case is properly prepared, it is not difficult to have a justice of the peace issue an Information against a fraudster. The difficulty takes place at the hearing before a judge. At these hearings, the Crown is required to attend and review the merits of the private prosecution. Evidence by way of testimony from the complainant is normally called. The Crown may cross-examine the complainant to determine the strength of the case and the credibility of the witness. The Crown, thereafter, advises the judge whether the prosecution should proceed and whether the accused should be required to answer the charge. If the Crown decides that the matter should proceed, it is usually the Crown who assumes carriage of the prosecution. If the Crown decides the matter should not proceed, there is virtually no recourse for the complainant other than to attempt to file his or her complaint with the police.
The reasoning behind this process of the Crown’s vetting of private prosecutions is to provide a judicial screening mechanism so that the justice system is not burdened with vexatious litigation, and so that innocent persons are protected from the stigma of having to appear in court on such matters. The reality is that the same Crown prosecutors who discourage the criminal fraud prosecutions submitted to them by the police also fail to allow private prosecutions to move forward.
At Investigation Counsel, we recommend that even if a criminal prosecution is sought, a civil action should almost always be brought simultaneously, or before hand. When a matter is turned over to the police or the Crown, the complainant loses control of the process and the outcome. We have had clients approach us who made criminal complaints only to find that the matter was not investigated or prosecuted, and more than two years had passed, which consequently statue barred them from bringing a civil action. At the end of the day they were left without any remedy.
At Investigation Counsel, we are experienced in preparing criminal fraud complaints for the police and in bringing private prosecutions, as well as weighing the pros and cons of bringing simultaneous civil actions. We welcome your call to discuss the use of criminal proceedings as part of your recovery plan.