BAHAMAS Law and Practice Contributed by: Adrian Hunt and Gabrielle Rahming, Graham Thompson
1. Fraud Claims 1.1 General Characteristics of Fraud Claims While civil fraud actions in The Bahamas can take many forms, at common law such claims are gener - ally rooted in the tort of deceit by way of claims of fraudulent misrepresentation. Alternative claims are frequently pursued in the tort of conspiracy. Generally, such claims involve allegations of dishon - esty, false statements, corrupt payments, misap - propriation of property and concealment, all with an intention to cause financial harm to the victims, and result in an unlawful gain to the perpetrator(s). Fraudulent Misrepresentation A common claim in fraud actions, fraudulent misrep - resentation is predicated on false statements. To suc - ceed on the claim, there are three key elements that must be made out for the court – ie, that: • the misrepresentation was knowingly false, or reck - lessly made without regard as to whether it was true or false; • it was intended that the misrepresentation would be acted upon; and • there was reliance on the misrepresentation result - ing in loss. Conspiracy By contrast, conspiracy is an economic tort that has two forms:
An agent who receives a bribe may be subject to a number of equitable and common law claims from his or her principal. These include claims of breach of fiduciary duty, damages for fraud or deceit, and forfeiture of the agent’s remuneration. Breach of Fiduciary Duty This cause of action is based on the duty of loyalty owed by the agent to act in, and avoid any conflict with, the interests of their principal. Under this cause of action, a principal can pursue the agent for an account of the profits received, or equitable compen - sation for the losses suffered as a result of the breach. Proprietary Claim The receipt of the bribe by the agent results in the bribe being held on constructive trust for the principal. The creation of a constructive trust is important as it offers protection against unsecured creditors in the event of the agent becoming insolvent. Additionally, the constructive trust would allow for tracing claims by the principal where the bribe is used to acquire other property, or comes into the hands of other parties who may have knowingly assisted with the bribe. Damages for Fraud and Deceit A claim can be pursued by a principal for losses suf - fered beyond the amount of the bribe itself. The onus will be on the claimant to establish that it has suffered such losses. Forfeiture of the Agent’s Remuneration Where the agent received remuneration or commis - sion for any work connected to the bribe, it follows that they should not be entitled to the remuneration or commission. The principal is therefore able to seek recovery of the remuneration paid to the agent in respect of the work connected to the bribe. 1.3 Claims Against Parties Who Assist or Facilitate Fraudulent Acts Parties who assist or facilitate fraudulent acts can be pursued by claims of knowing receipt and dishonest assistance. Knowing receipt claims are applicable when a party receives property that was held on trust or by a fiduci - ary, with knowledge that the property was transferred
• lawful means conspiracy; and • unlawful means conspiracy.
Both forms involve two or more persons acting togeth - er with the intention to cause harm to another. The main distinction between the two is that with respect to an unlawful means conspiracy, the intention to cause harm to another need not be the predominant purpose of the conspiracy. 1.2 Causes of Action After Receipt of a Bribe Pursuant to the Prevention of Bribery Act of The Baha - mas, bribery is only a criminal offence in The Bahamas in relation to acts involving public officials, local and foreign.
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