Fraud and Aggravated Fraud Offense

The offense of fraud is regulated in the Turkish Penal Code (TPC) in two forms, simple and aggravated, and is constituted by fraudulent acts committed against property and freedom of will.

The Turkish Penal Code defines the offense of fraud in two articles: simple fraud and aggravated fraud.

Pursuant to Article 157 of the Turkish Penal Code, which defines the simple form of the offense, it states: "A person who, through fraudulent conduct, deceives another and thereby obtains a benefit for themselves or another, to the detriment of that person or another, shall be sentenced to imprisonment for one to five years and a judicial fine of up to five thousand days." For simple fraud to be constituted, all elements must be present: fraudulent conduct, the deception of a person, damage to the victim or a third party, and the perpetrator obtaining a benefit for themselves or a third party.

All these elements must be present for the offense to be constituted. For instance, if no damage has occurred, fraud cannot be spoken of. Likewise, if there is no fraudulent conduct, the offense will not be constituted. The deception of the victim and the obtaining of a benefit are essential.

It is understood that the legal values protected by the offense of fraud are property and freedom of will.

Among the offenses committed against property through fraudulent conduct, besides fraud and aggravated fraud, are fraudulent bankruptcy (TPC Art. 161), negligent bankruptcy (TPC Art. 162), unlawful appropriation of services/benefits (TPC Art. 163), and providing false information concerning companies and cooperatives (TPC Art. 164). The common element in these offenses is the presence of fraudulent conduct.

The aggravated circumstances of the offense of fraud are specified in Article 158 of the Turkish Penal Code. The legal provision is as follows:

Article 158 - (1) If the offense of fraud is committed:

a) By exploiting religious beliefs and sentiments,

b) By exploiting the dangerous situation or difficult circumstances in which a person is found,

c) By exploiting the weakness of a person's perceptive ability,

d) By using public institutions and organizations, public professional organizations, political parties, foundations, or association legal entities as a tool,

e) To the detriment of public institutions and organizations,

f) By using information systems, banks, or credit institutions as a tool,

g) By taking advantage of the facilities provided by press and broadcasting tools,

h) During the commercial activities of merchants or company executives, or persons acting on behalf of a company; within the scope of the cooperative's activity by cooperative executives,

i) By persons engaged in independent professions, through the abuse of trust placed in them due to their profession,

j) With the aim of securing the opening of a credit facility that should not have been allocated by banks or other credit institutions,

k) With the aim of obtaining an insurance payment,

the perpetrator shall be sentenced to imprisonment for two to seven years and a judicial fine of up to five thousand days. (Added sentence: 29/06/2005-5377 Law No./Art. 19) However, in the cases listed in sub-paragraphs (e), (f), and (j), the lower limit of the imprisonment sentence shall not be less than three years, and the amount of the judicial fine shall not be less than twice the benefit obtained from the offense.

(2) A person who obtains a benefit from another by deceiving them with the claim of having a relationship with public officials, being influential with them, and promising to arrange a certain matter, shall be punished according to the provision of the preceding paragraph.

In business life, the most common form of this offense, as seen in Article 158/h of the Turkish Penal Code, is fraud committed during commercial activity. In practice, under what circumstances will normal commercial activity be referred to, and under what circumstances will commercial fraud be referred to? Will every merchant unable to pay their debt be considered within this scope? The important element here is that the victim has been misled through fraudulent conduct. It is often observed that in situations where fraudulent conduct is not clearly visible, the relationship is viewed as a contractual/commercial dispute, and prosecutors may issue decisions of non-prosecution. At this point, the accurate determination of fraudulent conduct is important. A person providing information contrary to the truth about themselves and their company to obtain a benefit for themselves or a third party constitutes aggravated fraud.

Article 158/i of the Turkish Penal Code regulates the commission of the offense by persons engaged in independent professions, through the abuse of trust placed in them due to their profession. Here, what defines the perpetrator of the offense is being an independent professional. For the offense to be committed, it is decisive that it was committed while performing their independent profession.

A frequently encountered form of the offense today is cyber fraud. The commission of aggravated fraud by using information systems, banks, or credit institutions as a tool, is an offense that can usually be traced and detected by following money transfer records.

There are numerous precedents illustrating the application for each sub-paragraph of the aggravated circumstances listed in the legal provision. The legal provision has set the lower limit of the penalty for the aggravated form of the offense at two years and the upper limit at seven years.

Aggravated fraud, in particular, is an offense defined by the law with a casuistic system, clearly specifying all aggravated circumstances without room for debate. Since the prosecution of the offense is not subject to a complaint, even when the victim's damage is compensated, prosecution continues on behalf of the public, and a public prosecution is initiated if sufficient evidence is obtained.