Articles for use in fraud (s.6 & s.7)

(1) A person is guilty of an offence if he has in his possession or under his control any article for use in the course of or in connection with any fraud.

(2) A person guilty of an offence under this section is liable—

(a) on summary conviction, to imprisonment for a term not exceeding the general limit in a magistrates’ court or to a fine not exceeding the statutory maximum (or to both);

(b) on conviction on indictment, to imprisonment for a term not exceeding 5 years or to a fine (or to both).

(3) Subsection (2)(a) applies in relation to Northern Ireland as if the reference to 12 months were a reference to 6 months.

(1) A person is guilty of an offence if he makes, adapts, supplies or offers to supply any article—

(a) knowing that it is designed or adapted for use in the course of or in connection with fraud, or

(b) intending it to be used to commit, or assist in the commission of, fraud.

(2) A person guilty of an offence under this section is liable—

(a) on summary conviction, to imprisonment for a term not exceeding the general limit in a magistrates’ court or to a fine not exceeding the statutory maximum (or to both);

(b) on conviction on indictment, to imprisonment for a term not exceeding 10 years or to a fine (or to both).

(3) Subsection (2)(a) applies in relation to Northern Ireland as if the reference to 12 months were a reference to 6 months.

The defendant:

had possession or control of;

an article;

for use in the course of or in connection with any fraud.

The wording draws on Section 25 of the Theft Act 1968. The proof required is that the Defendant had the article for the purpose or with the intention that it be used in the course of or in connection with an offence.

A general intention that he or another will commit fraud (meaning an offence under Sections 1-4 of the Act) will suffice. In R v Ellames 60 Cr App R. 7 (CA) the Court of Appeal said:

"In our view, to establish an offence under Section 25 (1) the prosecution must prove that the Defendant was in possession of the article, and intended the article to be used in the course of or in connection with some future burglary, theft or cheat. But it is not necessary to prove that he intended it to be used in the course of or in connection with any specific burglary, theft or cheat; it is enough to prove a general intention to use it for some burglary, theft or cheat; we think that this view is supported by the use of the word "any" in Section 25 (1). Nor, in our view, is it necessary to provide that the defendant intended to use it himself; it will be enough to prove that he had it with him with the intention that it should be used by someone else."

Section 6 will apply in any case where "Going equipped to cheat" would previously have been charged.

The principal distinction between Section 25 and Section 6 is that Section 6 does not require the defendant to be away from his place of abode.

There is no defence of "reasonable excuse". Those who are, in particular, properly in possession of or involved in the development of computer software or other items for use to test the security of computer or security systems must rely on their lack of intention that the items or programmes are "for use in the course of or in connection with any fraud." Prosecutors will be alert to such circumstances and the possible abuses.

The defendant:

makes, adapts, supplies or offers to supply any article;

for use in the course of or in connection with fraud;

knowing that it is designed or adapted for use in the course of or in connection with fraud (Section 7 (1) (a)) or

intending it to be used to commit or assist in the commission of fraud (Section 7 (1) (b).

"Knowledge" in Section 7 (1) (a) is a strict mens rea requirement. The House of Lords in Montila [2004] UKHL 50 said:

"A person may have reasonable grounds to suspect that property is one thing (A) when in fact it is something different (B). But that is not so when the question is what a person knows. A person cannot know that something is A when in fact it is B. The proposition that a person knows that something is A is based on the premise that it is true that it is A. The fact that the property is A provides the starting point. Then there is the question whether the person knows that the property is A."

In practice, the use to which the article can be put is likely to provide sufficient evidence of the defendant's state of mind. For example, articles such as:

the kits that are attached to ATM machines to capture card details;

forged credit cards or the equipment for making them;

lists of credit card numbers;

counterfeit goods presented as genuine;

do not have an innocent purpose that readily springs to mind.

A person who makes an article specifically for use in fraud, for example, a software programme to create a phishing website or send phishing email, may be ambivalent about whether the person to whom it is supplied actually uses it for fraud. He will fall foul of Section 7 (1) (a) but will not have the necessary intention for Section 7 (1) (b).

The manufacturer of articles that are capable of being used in or in connection with fraud but have other innocent uses will not fall foul of this section unless he intends that it should be used in a dishonest way (Section 7 (1) (b)). The makers of credit card readers are one example. The readers have an innocent purpose they are commonly used by traders who "store up" the details of all the transactions carried out during a day and submit them all together at the end of the day. The card reader merely verifies the validity of the card at the point when it is read and stores all the necessary information about the transaction. The other, dishonest, use is by point of sale staff who use the readers to "skim" credit card details either for use or sale. The dishonest manufacturer who intended a dishonest use would be guilty of Section 7 (1) (b) offence.