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Understanding Mortgage Fraud Under Bangladesh's Penal Code: Key Legal Provisions



Mortgage fraud is a serious financial crime that undermines the integrity of the banking and property sectors. In Bangladesh, several sections of the Penal Code, 1860 can be invoked to prosecute individuals involved in such fraudulent activities. Here’s a breakdown of the key sections commonly applicable in mortgage fraud cases.

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1. General Fraud & Cheating

These sections form the core legal foundation for prosecuting deceptive acts.

· Section 415 - Definition of Cheating: Defines cheating as deceiving a person fraudulently or dishonestly to induce them to deliver any property, or to intentionally cause them harm in body, mind, reputation, or property.
· Section 420 - Cheating and Dishonestly Inducing Delivery of Property: This is the most frequently used charge in financial fraud cases.
  · Punishment: Imprisonment for a term which may extend to seven years, and also a fine.

2. Fraudulent Dealings with Property (Sections 421-424)

These sections specifically target dishonest transactions related to property, highly relevant when assets are misrepresented or concealed in mortgage dealings.

· Section 421: Dishonest or fraudulent removal or concealment of property to prevent its distribution among creditors.
  · Punishment: Imprisonment up to two years, or a fine, or both.
· Section 422: Dishonestly or fraudulently preventing any debt or demand from being available for creditors.
· Section 423: Dishonest or fraudulent execution of a deed of transfer containing a false statement of consideration.
· Section 424: Dishonest or fraudulent removal or concealment of property.

3. Forgery (Sections 463-471)

Mortgage fraud often involves forged documents, such as fake title deeds, income certificates, or valuation reports.

· Section 463 - Definition of Forgery: Making a false document or electronic record with intent to cause damage or injury.
· Section 465 - Punishment for Forgery:
  · General Punishment: Imprisonment up to two years, or a fine, or both.
  · Forgery for Cheating: If the forgery is committed with the intention of cheating (under Section 468), the punishment can be more severe, extending up to seven years and a fine.

4. Additional Relevant Sections

Depending on the specifics of the fraud, other sections may also apply.

· Section 406 - Criminal Breach of Trust: Applies when a person entrusted with property (or with any dominion over it) dishonestly misappropriates or converts it for their own use.
· Section 477A - Falsification of Accounts: Relevant when fraudulent entries are made in account books to facilitate or conceal the mortgage fraud.

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