Kit Kat-ch me if you can - 55,000 rare Japanese KitKats go missing in act of civil fraud on quest from Japan to New Jersey

A New York company's, Bokksu, entire shipment worth $110,000 containing 55,000 rare KitKats has been KIT-napped. After becoming the target of a new scam known as 'strategic theft', which encompasses identity fraud and deceptive pick-up methods, the shipment was KAT-ured en route to its destination in New Jersey.

KATS out the bag

From Japan, the KitKat shipment made it safely to California before taking a break in a storage facility in South El Monte. Now in the hands of Freight Rate Central, an individual called "Tristan" from HCH Trucking was recruited to facilitate the shipment's last leg to Bokksu’s warehouse in New Jersey. However, when there was no sign of the shipment reaching New Jersey, Bokksu contacted HCH Trucking, only to find out that they had no knowledge of "Tristan". Eventually, Tristan confessed and provided information about the two locations where the KitKats were delivered. Bokksu attempted to have the goods released but were scammed once again by an individual named "Harry Centa". The storage facility explained that they had a contract with "Harry Centa" and could not release the goods without proof of rightful ownership.

So, what are the legal implications of this?

Civil Fraud - what is it?

Civil Fraud is an action that may be pursued by those who have been deceived by fraudulent actions and wish to seek damages for loss resulting from the fraudulent behaviour. In such cases, the objective is to recover the funds or assets that have been taken, as well as seek monetary compensation from the individuals or entity accused of the civil fraud.

Civil Fraud can take various forms which affect both individuals and corporate entities. Most claims involve an element of misrepresentation, deception, or dishonesty to gain an unfair advantage or cause harm to others. The most common claim of civil fraud is fraudulent misrepresentation. Those who have fallen victim to financial fraud have the option to pursue recovery of the lost funds or assets through the civil courts to recover damages (compensation for the losses incurred to restore the position to a point as if the false statement or misrepresentation had never been made). To satisfy the court of this, the claimant must establish:

• A false statement or representation has been made;
• The individual or corporate entity either knew the statement was false or showed recklessness towards its truthfulness;
• There was an intention for reliance on the false statement;
• There was a reliance on the false statement or representation made; and
• As a result, loss was suffered.

Prevention

If you or your business have fallen victim to fraud, it is important to take the necessary legal steps to identify your specific claim and the party responsible. While "civil fraud" is not a standalone legal cause of action, it is used as an umbrella term to encompass various fraudulent activities, as mentioned above.

But can it be prevented? In short, yes.

An application to the courts for an interdict (Scotland) or an injunction (England), if successful, requires a party to do something or refrain from doing something.

Interdicts / Injunctions can be granted either on an "interim" basis, meaning they are temporary, or on a "final" basis, meaning they are intended to be permanent. In the scenario of civil fraud, an injunction/interdict may be sought to prevent financial or reputational harm being caused. For Scotland, you can refer to our previous blog on interim interdicts.

In England, some common types of injunctions used in a fraud context include:

• Freezing orders - where an individual is restricted from disposing of their assets. Typically, this restriction is put in place to prevent the depletion of assets either through excessive spending or attempts to conceal.
• Search orders - to identify and safeguard evidence or property that might be involved in a legal proceeding.
• Orders by delivery-up - a situation where someone is legally required to provide documents or materials.

Conclusion

If you have any questions about civil fraud, interdicts, or injunctions, then please do not hesitate to get in touch.