Fraud Bill [HL]

moved Amendment No. 3:"Page 2, line 3, leave out paragraph (b) and insert—" ““(b)   the person making it— (i)   knows that it is untrue or misleading, or (ii)   knows that it might be untrue or misleading and is reckless as to whether it is untrue or misleading.”” The noble Lord said: The difference between this amendment and the wording of the Bill is essentially the insertion of the word ““reckless””. The definition of false representation in Clause 2 includes a misleading representation provided,"““the person making it knows that it is, or might be, untrue or misleading””." We believe that that is too wide. We believe that the clause should be amended to require recklessness, as under the current law. For example, advertisers may make representations knowing that they might be misleading. As they clearly act with the intention of making a gain, their only protection from criminal liability is the question of dishonesty. It is too uncertain to leave culpability in these circumstances to the subjective view of the jury. It has been suggested that the seller of a Renoir painting would be able to protect himself from a fraud charge only if he had said, ““I honestly believe this to be a Renoir””, rather than simply, ““This is a painting by Renoir””. The seller, knowing difficulties in the attribution of paintings in general, knows that his statement might be false, and so would be guilty of the offence if a jury finds him to be dishonest. In such a case, the Government rely upon dishonesty to draw the line. By contrast, we believe that an alternative drafting would avoid the need to leave the matter to the subjective view of the jury. Under existing law, deception means any deception, whether deliberate or reckless, by words or conduct as to fact or as to law, including a deception as to the present intentions of the person using the deception or any other person. In a case called Staines (60 Criminal Appeal Reports 160) ““recklessness””, in this context, was interpreted as,"““an indifference to or disregard of the feature of whether a statement be true or false””." This definition has presented no problems. If the person is indifferent as to whether the statement is true or false, but unaware of the risk that it might be false, or might be misleading, then he should not be culpable. This follows a case called R v G [2004] (1Appeal Cases 1034). So to make that clear, we think that both recklessness and knowledge should be included in the clause. An advertiser or an auction house who has taken adequate steps to check his representation before making it could not be said to be reckless, and so would not be prima facie guilty of the offence. I beg to move.