Not everyone who is accused of or charged with fraud sets out to actually commit fraud. However, if the prosecution can stack up enough evidence against a person, they can still be convicted of the crime. It is important to understand the cause of action in Nevada for fraud or intentional misrepresentation which is a common component of fraud. It could mean the difference between walking away free or facing fines and jail time.
What is Intentional Misrepresentation?
Intentional misrepresentation is a term used in contract law to describe a false statement that one party makes or presents as a material fact which affects the other party’s decision in pursuing or agreeing to a contract. It is often seen in mortgage lending fraud (NRS 205.372), securities fraud (NRS 90.650), and obtaining money, property, rent, or labor by false pretenses (NRS 205.380). However, it can show up in other types of fraud, especially if there is some type of contract or agreement, either written or verbal.
The false statements can be made outright, or they can be implied. Further, it can be conveyed via an agent and not directly from the fraudulent party. Omission and suppression of a material fact can also be considered fraud.
Most fraud must have some degree of intentional misrepresentation in order for it to be fraud. This means that the person committing the fraud knew that what they were presenting or telling the other party was not true or that it was misleading. In other words, they used it to manipulate the other party into making a decision in the fraudulent party’s favor.
What Intentional Misrepresentation is Not
Not all untrue statements are considered intentional misrepresentation. Statements that may or may not be true include:
- “Puffing” (sales talk)
- Innocent misrepresentation
Intent is the driving force in a fraud crime. Intent must be proven.
The Six Elements of Fraudulent or Intentional Misrepresentation
In order for a person to be charged with fraud or intentional misrepresentation in Nevada, there are six elements that must be met. These elements generally occur in stages of the fraudulent act. They are:
- The accused makes a false claim or statement or misrepresentation regarding an existing or past fact
- The accused makes the false claim or statement or misrepresentation with belief or full knowledge that it is false or that they do not have a sufficient or adequate basis of information to state it as a fact
- The accused intended to compel the victim to believe the false claim or statement or misrepresentation as fact and act on it accordingly
- The victim had justifiable reliance on the false claim or statement or misrepresentation
- The victim sustained damages and causation as a result of relying on the false claim or statement or misrepresentation
- The fraud or intentional misrepresentation must be proven by convincing and clear evidence and it must be pled with specificity
Each of these elements must be met in order for the action to qualify as fraud. It is the duty of the prosecution to prove it beyond a reasonable doubt.
Defenses for Fraud or Intentional Misrepresentation
A fraud or intentional misrepresentation charge is not simple or easy to get out of. Fraud cases can be very complex so it is wise to hire an experienced defense attorney who has successfully represented fraud cases. They will work with their client to construct a solid defense strategy based on the specific factors in the case.
Some of the more common defenses for fraud include:
- Last of intent to defraud on the part of the defendant
- The defendant was falsely accused
- The defendant presented estimates or opinions and did not state them as fact
- The victim did not sustain damages as a result of the alleged false statements, claims, or misrepresentations
- The evidence was obtained by an unlawful asset forfeiture or illegal search and seizure and therefore should be excluded
If the defense attorney is able to raise a reasonable doubt regarding the guilt of the defendant, then the judge should dismiss the case. They may be able to do this by presenting evidence such as eyewitness testimonies, emails, text messages, correspondence, documents, official records, recordings, and expert witnesses.