Fraud (§ 263 StGB) – Elements, Penalties and Defense

In brief: Fraud under § 263 StGB requires a deception that causes an error in the victim, which leads to a disposition that reduces their assets – combined with the intent to enrich oneself unlawfully. The range runs from a fine to ten years of imprisonment in especially serious cases. Not every unpaid invoice is fraud; what matters is intent already at the time the contract is concluded. Many proceedings can be resolved through compensation, discontinuance or a penalty order.

The fraud accusation ranges from the unpaid online purchase to large-scale investment schemes. Because § 263 attaches to an everyday activity – concluding contracts – the line between criminal fraud and a mere civil-law non-performance is often narrow. This article explains the requirements, the sentencing range and the concrete options for action. An overview of the variants is also provided on our page on fraud (§ 263 StGB).

The Five Requirements of Fraud

The offense of fraud is a chain that must connect seamlessly. If one link is missing, criminal liability is excluded:

• Deception about facts – express, implied (for instance by conduct when ordering) or by omission where there is a duty to disclose.
• Error – a misconception must arise in the deceived person. Whoever knows the truth or is indifferent does not err.
• Disposition of assets – the deceived person acts, tolerates or omits and thereby reduces their assets.
• Financial loss – after an economic balancing, a minus must remain; a concrete endangerment of assets can also suffice.
• Intent to enrich – the offender seeks an unlawful pecuniary advantage for themselves or a third party that is congruent with the loss.

Each of these elements is a potential point of attack for the defense – especially intent and the intent to enrich.

Distinction: Not Every Unpaid Invoice is Fraud

Whoever simply fails to pay for a service or to perform a contract does not yet commit fraud. It becomes punishable only where the offender was already unwilling or unable to pay when the contract was concluded and deceived about this (so-called contract-formation fraud). Whoever intended to pay when ordering but later runs into payment difficulties acts in breach of civil law, but not criminally. This distinction is frequently the core of the defense – proving intent at the time of ordering is often difficult for the prosecution.

What Penalty is Threatened?

The basic offense (§ 263(1)) provides for imprisonment up to five years or a fine; the attempt is punishable. In especially serious cases (§ 263(3)) the range increases to six months to ten years. Such a case is present as a rule where the offender acts commercially or as a member of a gang, causes a loss of large extent – according to the case law of the Federal Court of Justice regularly from around 50,000 euros – brings a large number of people into danger of a loss, causes economic hardship, or abuses powers as a public official. Commercial gang fraud (§ 263(5)) is even a felony with a minimum sentence of one year. An important aim of the defense is therefore to dispel the accusation of commerciality or of a gang, and thus to avoid the leap into the felony range.

Related Offenses

Numerous special offenses cluster around fraud and frequently arise at the same time: computer fraud (§ 263a), breach of trust (§ 266), subsidy fraud (§ 264), capital investment fraud (§ 264a), insurance misuse (§ 265) and the withholding of social security contributions (§ 266a). A special case is social benefits fraud against authorities.

Typical Forms

In practice we encounter above all: contract-formation and goods-credit fraud (ordering without willingness to pay), investment and capital-investment fraud, billing fraud (for instance in the healthcare sector), online and marketplace fraud, the grandchild trick and shock calls, and fraud against authorities and insurers. Each case group has its own logic of evidence and its own defense approaches.

Typical Items of Evidence

Fraud proceedings are document and data proceedings. Central items of evidence are contracts, emails and chat histories, account movements and accounting records, IP addresses and digital traces, and witness statements by the injured parties. The critical evaluation of these documents – in particular the question of what they reveal about intent at the time of the offense – is the basis of the defense.

Strategy and Options for Action

1. Remain Silent and Obtain File Access

As an accused person you should make no statement on the matter (§ 136 StPO) and not follow a police summons without legal support. Only file inspection (§ 147 StPO) shows on what the prosecution bases the intent.

2. Attack Intent and Intent to Enrich

The most frequent approach is to show that willingness and ability to pay existed at the time the contract was concluded – then intent is missing. The intent to enrich or the congruence of advantage and loss can also often be called into question.

3. Dispute or Reduce the Loss

Without a financial loss there is no completed fraud. The loss can frequently be assessed lower than the complaint claims after an economic balancing – which can decide the boundary to the especially serious case and the level of the sentence.

4. Compensation and Discontinuance

Repaying the loss and a victim-offender mediation (§ 46a StGB) have a mitigating effect and pave the way to a discontinuance under § 153 StPO (minor guilt) or § 153a StPO (against a condition). For manageable losses and first offenders, discontinuance is a realistic aim.

5. Avert the Felony Accusation

Where commerciality or a gang is at issue, refuting these features is a priority – it decides the leap from the misdemeanor (§ 263(1)) to the felony (§ 263(5)) and thus years of minimum sentence.

6. Examine Penalty Order and Limitation

In smaller cases the proceedings often end with a penalty order, against which an objection is possible within two weeks (§ 410 StPO). The limitation period is always worth examining – the basic offense becomes time-barred after five years.

Consequences of a Conviction

Besides a fine or prison sentence, entry in the Federal Central Criminal Register looms and – from more than 90 daily units of a fine or more than three months of imprisonment – in the certificate of good conduct (§ 32 BZRG). For the self-employed and traders, a fraud conviction can lead to the assumption of commercial unreliability and to a trade prohibition; for civil servants disciplinary consequences loom, for foreign nationals consequences under residence law. A prison sentence of up to two years can be suspended on probation (§ 56 StGB).

Frequently Asked Questions

Is an unpaid invoice already fraud?

No. Only whoever deceived about their willingness or ability to pay already at the time the contract was concluded is liable. Whoever cannot pay only later acts in civil law, but not criminally.

Can fraud proceedings be discontinued?

Yes. For a manageable loss, compensation and first-offender status, a discontinuance under § 153 or § 153a StPO comes into consideration.

From what loss does it become especially serious?

A loss of “large extent” exists according to the case law regularly from around 50,000 euros and establishes an especially serious case with an increased range.

What should I do after a summons for fraud?

Make no statement on the matter, do not attend the police appointment and instruct a defense lawyer who obtains file access and examines the evidence of intent.

How We Can Help

The fraud accusation stands or falls with proof of deception, loss and intent at the right time. Whoever remains silent early, has the file evaluated and sets the course through compensation, discontinuance or the refutation of the qualifying features can decisively influence the proceedings. We defend you in Bonn and throughout the Rhineland; more on our page for criminal defense in Bonn.

This article provides a general overview and does not replace advice in an individual case. A reliable assessment is only possible after inspection of the file and a personal consultation.

Written by attorney Philip Bafteh, criminal defense attorney in Bonn. Philip Bafteh publishes regularly on criminal and commercial law and defends accused persons in investigative and trial proceedings.

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Last updated: July 2026