Fraud

FRAUD, the prohibition against wronging another in selling or buying property (Lev. 25:14) is one of civil (see *Ona'ah) rather than criminal law – although, since it is a negative injunction, its violation by any overt act may result in the punishment of *flogging (Tos. and Penei Yehoshu'a to BM 61a; cf. Maim. Yad, Sanhedrin 18:1). Where reparation can be made by the payment of money, no such punishment may be inflicted in addition (cf. Yad, loc. cit., 2 and Mekhirah 12:1; Ket. 32a; Mak. 4b, 16a). The express repetition, "And ye shall not wrong one another, but thou shalt fear thy God" (Lev. 25:17), was interpreted to prohibit the "wronging" of another not only in commercial transactions but also in noncommercial intercourse: the prohibition extends to "wronging by words" as distinguished from wronging by fraudulent deeds and devices; and wronging by words includes pestering people in vain as well as offending or ridiculing them (BM 4:10). It is said that wronging by words is even more reprehensible than wronging by fraudulent deeds, because while the latter is an offense against property only and can be redressed by the payment of money, the former is an offense against the person and his reputation, for which money will not normally be an adequate compensation (BM 58b; Yad, Mekhirah 14:12–18; see *Slander). However, though not constituting a cause of action for damages, wronging by words is not punishable by flogging either, because the mere utterance of words is not considered such an overt act of violation as may be punished in this way (cf. Yad, Sanhedrin 18:2). The admonition "but thou shalt fear thy God" (Lev. 25:17) is said to indicate that even though the offender may escape human punishment, divine retribution is certain to follow (Yad, Mekhirah 14:18; Ibn Ezra to Lev. 26:17).

The fact that fraud, even in the civil law meaning of the term, was in biblical times regarded as eminently criminal in character is well illustrated in Ezekiel's discourse on individual criminal responsibility: the same responsibility attaches for wronging the poor and needy, converting property, and not restoring pledges, as for murder, robbery, and adultery (Ezek. 18:10–13), and for all those misdeeds the same capital punishment is threatened (ibid.). Fraud and *oppression are usually found in the same context as *usury (Ex. 22:20, 24; Lev. 25:14, 17, 37; Deut. 23:17, 20; Ezek. 7–8; 12–13, 17). Fraud has also been held as tantamount to larceny (see *Theft and Robbery; Tur, ḤM 227). As fraud and oppression go hand in hand, their victims are often the weak and the underprivileged; hence there are particular prohibitions on fraud against strangers (Ex. 22:20), widows and orphans (Ex. 21), and slaves (Deut. 23:17). Wronging widows and orphans is so repulsive in the eyes of God that "if they cry at all unto Me… My wrath shall wax hot and I will kill you with the sword, and your wives shall be widows and your children fatherless" (Ex. 22:22–23). Wronging and vexing the poor and the stranger draws forth God's wrath (Ezek. 22:29–31 et al.) and is a cause of national disaster (Jer. 22:3–6).

In post-talmudic times, fraudulent business practices often resulted in the courts barring or suspending the offender from carrying on business. While isolated instances of fraud would be dealt with as civil matters, repeated and notorious fraudulent business practices might be punished by the sequestration of the offender's business, depriving him of his livelihood (S. Assaf, Ha-Onshin Aḥarei Ḥatimat ha-Talmud (1922), 43). On other aspects of fraud see also *Gerama.

In the State of Israel, the criminal law on fraud and kindred offenses has been reformed and expanded by the Penal Law Amendment (Deceit, Blackmail and Extortion) Law, 5723–1963. Fraud is there defined as any representation of fact – past, present, or future – made in writing, by word of mouth, or by conduct, which the maker knew to be false or did not believe to be true. It is made a criminal offense not only to obtain anything by such fraud, but also to obtain anything by any trick not amounting to fraud or by the exploitation of another's mistake or ignorance. Particular instances of fraud mentioned in the Act are pretenses of sorcery or fortune-telling; forgeries and unauthorized alterations of documents and the use or uttering of the same; the fraudulent suppression or concealment of any document or chattel, and the fraudulent incitement of others to make, alter, or conceal documents; as well as the issue of a check where the drawer knew that the banker on whom it was drawn was not bound to honor it.

Sources: Encyclopaedia Judaica. © 2007 The Gale Group. All Rights Reserved.