Fraud Crimes and Aggravated Forms

ENTRANCE

With the increasing complexity of the economic structure, the spread of digitalization, and the globalization of trade, crimes against property have also diversified and intensified. Fraud, is a multi-faceted crime that threatens the economic security not only of individuals but also of the public. With the development of technologies, sub-types such as digital fraud, cryptocurrency fraud, and investment fraud have also rapidly become widespread.

Fraud, a crime against property, is regulated in detail in both its simple and aggravated forms in the Turkish Penal Code No. 5237. This article will analyze the definition of the crime, its elements, aggravated forms, penal sanctions, Supreme Court precedents, problems encountered in practice, and proposed solutions from a legal perspective.

1. DEFINITION AND LEGAL REGULATION OF THE CRIME OF FRAUD

1.1. Simple Fraud (Turkish Penal Code Article 157)

Article 157 of the Turkish Penal Code defines the crime of fraud as follows:

"A person who deceives someone by fraudulent conduct, thereby causing harm to that person or another and gaining benefit for himself or another, shall be punished with imprisonment from one to five years and a judicial fine of up to five thousand days."

1.2. Qualified Fraud (Turkish Penal Code Article 158)

Article 158 of the Turkish Penal Code stipulates that the punishment will be increased if the crime is committed in certain ways. For example:

• Exploitation of religious beliefs

• By using the title of public official

• Using information systems

• Insurance fraud

• In the capacity of a merchant or company director

• By using banks or credit institutions as a tool

• Fraud related to capital market instruments

In this case, the penalty is imprisonment for 3 to 10 years and a judicial fine of not less than 5,000 days.

2. ELEMENTS OF THE CRIME

2.1. Material Element

• The perpetrator deceives the victim through fraudulent behavior.

• The victim being deceived by these behaviors and taking action

• Damage resulting from this process

• Unjust enrichment by the perpetrator or another person

Deception is more than just a false statement. It requires the perpetrator to mislead the victim through planned, skillful, and complex actions that impair the victim's free will.

🔹 Supreme Court of Appeals, 15th Criminal Chamber, Case No. 2020/3487, Decision No. 2021/1344:

“A simple false statement does not constitute fraud. However, in this case, the date and amount on the promissory note were altered, the signature was forged, and the victim was systematically misled. The crime of fraud has been committed.”

2.2. Spiritual Element

Fraud can only be committed intentionally. The perpetrator must act with the intention of deceiving the victim and obtaining a benefit from the outset. Fraud committed through negligence is not possible.

3. ANALYSIS OF QUALIFIED CIRCUMSTANCES

3.1. Exploitation of Religious Beliefs

Exploiting religious sentiments to gain unfair advantage, such as through sacrificial animal donations or Umrah pilgrimage arrangements, constitutes aggravated fraud.

3.2. Fraud using Information Systems

Fraud types such as fake e-commerce websites, phishing, and fake banking applications are considered within this scope.

🔹 Supreme Court of Appeals, 11th Criminal Chamber, Case No. 2019/6143, Decision No. 2020/7512:

“The defendant posted fake real estate advertisements online and received down payments from the victims. Due to the use of information systems, the crime of aggravated fraud under Article 158 of the Turkish Penal Code has been committed.”

3.3. Fraud Committed in Commercial and Professional Activities

The penalty is increased if a trader or company official deceives the victim by exploiting their commercial reputation.

4. DAMAGES AND SUBJECT OF COMPLAINT

In fraud cases, the element of harm is crucial. For the perpetrator to be punished, there must be a decrease in the victim's assets.

Fraud offenses under Articles 157-158 of the Turkish Penal Code are not subject to complaint. They are investigated ex officio. However, in cases of attempted simple fraud, a complaint may be required if no damage has occurred.

5. LIMITS OF FRAUD AND SIMILAR CRIMES

5.1. Fraudulent Installment Sales

A buyer purchasing goods in cash and failing to pay installments is not always considered fraud. It requires a lack of intention to pay from the outset.

🔹 Supreme Court of Appeals, 15th Criminal Chamber, Case No. 2018/2357, Decision No. 2019/1873:

"If a buyer signs a contract with a fixed price and then fails to pay their debts, this alone may not be fraud, but rather a breach of the debt relationship. However, if it is established that the perpetrator had no intention of paying from the outset, then fraud occurs."

5.2. Distinguishing Between Breach of Trust and Misuse of Trust

In fraud, the victim is deceived and willingly hands over the property. In breach of trust, the perpetrator misuses property that was previously entrusted to them.

6. ACTIVE REMORSE AND REDUCTION OF SENTENCE

According to Article 168 of the Turkish Penal Code, if the damage is remedied before the completion of the crime, a reduction in punishment is applied.

• Compensation during the investigation phase: The penalty can be reduced by up to one-third.

• Compensation during the prosecution phase: The penalty can be reduced by up to one-sixth.

This not only provides compensation for the harm suffered by the victim, but also contributes to shortening the judicial process.

7. PROBLEMS ENCOUNTERED IN PRACTICE

• Courts differ in their determination of the degree of fraud.

• Many disputes arising from commercial relationships are being attempted to be classified as fraud; thus, the scope of intervention of criminal law is being expanded.

• In cases of cyber fraud, identifying the perpetrator is becoming increasingly difficult due to technical factors.

• Despite compensation for harm incurred during the legal process, the deterrent effect of punishment weakens, and some perpetrators with a shield of effective remorse .

8. CONCLUSION

Fraud is a crime that lies at the intersection of property law and criminal law, and it is increasingly digitalized and causes significant societal harm. Both legal regulations and high court precedents have clarified the scope, limits, and aggravating circumstances of this crime. However, in practice, differences in interpretation persist in many areas, such as the element of deception, the condition of harm, and the limits of the act.

According to the "ultima ratio" principle of criminal law, a distinction must be made between malicious conduct in commercial relations and actual fraud offenses; innocent business dealings should not be criminalized while victims are protected in trials.