The Crime of Fraud from the Perspective of Islamic Jurisprudence and the Omani Penal Code

Crime of Fraud

Among the financial crimes that have widely spread in society to the extent of becoming a criminal phenomenon is the crime of financial fraud. Therefore, we will address it according to the provisions of the Omani Penal Code. Financial fraud is the unlawful seizure of another person’s property by fraudulent means. Unfortunately, fraud has become one of the most common crimes due to fraudsters’ ability to develop their methods and disguise them with a façade of deception, trickery, and illusion, which act as bait that ensnares many victims driven by need, greed, or negligence.

Fraud in Islamic Sharia:

According to Islamic Sharia, cheating, fraud, and consuming people’s wealth unjustly are prohibited, even if the perpetrator achieves them through loopholes in man-made law. Such an offender is subject to the severe warning contained in Allah’s saying: “O you who have believed, do not consume one another’s wealth unjustly but only [in lawful] business by mutual consent. And do not kill yourselves [or one another]. Indeed, Allah is to you ever Merciful. And whoever does that in aggression and injustice – We will drive him into a Fire. And that, for Allah, is [always] easy.” [Surah An-Nisa, 29–30].

Fraud in the Omani Penal Code:

According to Royal Decree No. 7/2018 promulgating the Penal Code, Article (349) defines fraud as obtaining an unlawful benefit for oneself or others by using fraudulent methods, or by adopting a false name or a false capacity. Fraud is classified as a crime against property, whereby the fraudster seizes another’s money by deceiving him and inducing him to hand it over through various temptations and false promises.

While the concepts of fraud and theft are close, the difference is clear: in theft, the property is taken without the victim’s consent and applies only to movable property; in fraud, the property is taken with the victim’s consent and applies to both movable and immovable property. Article (349) of the Omani Penal Code criminalizes fraud and sets its elements, stating:

“Whoever obtains from another an unlawful benefit for himself or others by using one of the fraudulent methods, or by adopting a false name or a false capacity, shall be punished by imprisonment for not less than three (3) months and not more than two (2) years, and a fine of not less than one hundred (100) Omani Rials and not more than three hundred (300) Omani Rials, or by either of these two penalties. The penalty shall be increased, not exceeding double, if the act of fraud is committed against a person under eighteen (18) years of age or against an adult lacking full mental capacity.”

From the text of Article (349), we observe that the legislator limited fraud to obtaining unlawful benefits by fraudulent means or false identities, without specifying the exact methods. It left them general, such that any act or omission intended to obtain unlawful benefit is considered fraudulent. Fraud generally follows these steps:

• The act of deception through one of the methods of fraud.
• The victim falling into error.
• The victim, under this error, engaging in a financial act that leads to handing over money to the fraudster.

In fraud, each step is causally linked to the previous: the deception causes the error, the error leads to the financial act, and the financial act results in handing over the money, as stipulated in Articles 349 and 350 of the Penal Code.

Fraudulent means can include, for example:

1. Use of deceit and trickery.
2. Fabricating a lie endorsed by a third party, even if in good faith.
3. Creating or exploiting circumstances favorable to the crime.
4. Disposing of movable or immovable property while knowing one has no authority to do so.
5. Using a false name or false capacity.

Note:

 The common saying that “the law does not protect the foolish” does not apply here. The fraudster is someone accustomed to deceiving others through manipulative methods that could convince many. Therefore, he should not escape punishment, as his crime undermines the stability of society and breeds mistrust among people.

From practical experience in the legal profession, we see many fall victim to fraud due to pressing need or, more often, greed. Victims may go so far as to take loans, sell jewelry, or mortgage land to obtain money for the fraudster, only to later regret chasing illusions.

By: Dr. Mohammed Gharbawi

Muscat, Sultanate of Oman