Sentencing

• Author: Jonathan Shime/Ian Smith/Grace Hession David
• Pages: 99-145

99

Sentencing

6

I. The Statutory Regime ...................................... 100

II. The Availability (or Unavailability) ofConditionalSentences ....... 101

III. The Guiding Principles on Sentencing in Fraud Cases ............ 103

IV. Constitutionality of the Fraud Mandatory Minimum ............. 104

V. Breach of Trust Frauds ..................................... 106

VI. The Role of Remorse in Sentencing .......................... 108

VII. Victim Impact Statements .................................. 109

A. Victim Impact Statements, Pursuant to Section 722(1) ..... 109

B. Community Impact Statements, Pursuant to

Section 722.2(1) .................................... 111

VIII. Prohibition Orders ........................................ 111

IX. Conclusion .............................................. 112

Appendix 6.1 Form 34.2: Victim Impact Statement ............ 113

Appendix 6.2 Form 34.3: Community Impact Statement ........ 120

Appendix 6.3 Sentencing Charts ........................... 126

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100 Prosecuting and Defending Fraud Cases

I. The Statutory Regime

Sentencing in fraud will be largely based on the facts. However, there are certain

principles of sentencing that have been enumerated in the Criminal Code and must

guide the sentencing judge. The purpose of this chapter is to outline the sentencing

principles that must be addressed at a sentencing hearing as well as the various fac-

tors, aggravating or mitigating, that will aect the sentence at the end of the day. To

begin with, it is important to note that the maximum penalty for fraud over $5,000 in

Canada is 14 years. Moreover, the Criminal Code provides for a mandatory minimum

sentence of two years if the Crown has obtained a conviction for a fraud with a quan-

tum of $1 million or more:

Fraud

380(1) Every one who, by deceit, falsehood or other fraudulent means, whether or

not it is a false pretence within the meaning of this Act, defrauds the public or any person,

whether ascertained or not, of any property, money or valuable security or any service,

(a) is guilty of an indictable oence and liable to a term of imprisonment not exceed-

ing fourteen years, where the subject-matter of the oence is a testamentary instrument

or the value of the subject-matter of the oence exceeds five thousand dollars; or

(b) is guilty

(i) of an indictable offence and is liable to imprisonment for a term not

exceeding two years, or

(ii) of an oence punishable on summary conviction,

where the value of the subject-matter of the oence does not exceed five thousand

dollars.

(1.1) When a person is prosecuted on indictment and convicted of one or more of-

fences referred to in subsection (1), the court that imposes the sentence shall impose a

minimum punishment of imprisonment for a term of two years if the total value of the

subject-matter of the oences exceeds one million dollars.

Section 380.1(1) sets out certain aggravating factors that the sentencing court must

consider. They are as follows:

(a) [if] the magnitude, complexity, duration or degree of planning of the fraud

committed was significant;

(b) [if] the oence adversely aected, or had the potential to adversely aect,

the stability of the Canadian economy or financial system or any financial market in

Canada or investor confidence in such a financial market;

(c) [if ] the oence involved a large number of victims;

(c.1) [if ] the oence had a significant impact on the victims given their personal

circumstances including their age, health and financial situation;

(d) [if,] in committing the oence, the oender took advantage of the high regard

in which the oender was held in the community;

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Chapter 6 Sentencing 101

(e) [if ] the oender did not comply with a licensing requirement, or professional

standard, that is normally applicable to the activity or conduct that forms the subject-

matter of the oence; and

(f ) [if ] the oender concealed or destroyed records related to the fraud or to the

disbursement of the proceeds of the fraud.

The sentencing court must also consider the following:

380.1(1.1) Without limiting the generality of section 718.2, when a court imposes

a sentence for an oence referred to in section 382 [fraudulent manipulation of stock

exchange transactions], 382.1 [insider trading] or 400 [filing a false prospectus], it shall

also consider as an aggravating circumstance the fact that the value of the fraud commit-

ted exceeded one million dollars.

(2) When a court imposes a sentence for an oence referred to in section 380, 382,

382.1 or 400, it shall not consider as mitigating circumstances the oender’s employ-

ment, employment skills or status or reputation in the community if those circum-

stances were relevant to, contributed to, or were used in the commission of the oence.

[Emphasis added.]

II. The Availability (or Unavailability)

ofConditionalSentences

It should be noted that section 380(1.1) was only added to the Criminal Code in 2011.

The most obvious consequence of this amendment was that those convicted of frauds

over $1 million had to be sentenced to a penitentiary term of at least two years. How-

ever, an important secondary impact of this provision is that conditional sentence

orders are now unavailable for frauds over $1 million. This is by virtue of section

742.1 of the Criminal Code, which prohibits conditional sentences where the penalty

imposed is more than two years, and also by operation of section 742.1(b), which bars

a conditional sentence where there is a minimum term of imprisonment. As we have

already noted, there is a mandatory minimum of two years’ imprisonment for a fraud

if the quantum exceeds $1 million by virtue of section 380(1.1).

In November 2012, conditional sentences were further restricted. Parliament dir-

ected at that time that conditional sentences would no longer be available for indict-

able oences where the maximum penalty was 14 years or life, pursuant to section

742.1(c). Thus, where an accused is charged with fraud over $5,000 (a straight indict-

able oence), which has a maximum penalty of 14 years, the conditional sentence

regime is no longer available (assuming the oence took place after 2012).

In summary, conditional sentences are no longer available for accused found guilty

of fraud over $5,000 for post-2012 oences. They do remain available, however, for

those convicted of fraud under $5,000.

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