To ensure a correct understanding, one should first consider the meanings of “The Offense of Fraud” and a “Civil Breach of Contract” to see how they differ.
The Offense of Fraud under Section 341 of the Criminal Code lays down the principle that: “Whoever dishonestly deceives another person by asserting a falsehood or concealing a fact that should be disclosed, and by such deception obtains property from the person so deceived or a third party, or causes the person so deceived or a third party to execute, revoke, or destroy a document of right, commits the offense of fraud, and shall be punished with imprisonment not exceeding three years, or a fine not exceeding sixty thousand baht, or both.”
The heart of the Offense of Fraud lies in having a “dishonest intent from the beginning.” That is to say, at the moment of initial contact or agreement, the offender already had the intention to deceive and obtain property, rather than forming the idea later. Examples include persuading people to invest in Ponzi schemes promising unrealistically high returns, online fraud where goods are ordered and paid for but the seller closes the page and flees, or falsely claiming to be a company representative to collect deposits. In these cases, if it can be proven that there was deceptive intent from the start, it constitutes a criminal offense. The injured party can file a criminal complaint so that investigating officers can prosecute the deceiver.
On the contrary, a Civil Breach of Contract occurs when a party fails to perform according to the agreements or representations made in a contract, but without an initial intent to deceive—regardless of whether the contract was made in writing or not. Examples include a construction contractor failing to complete work within the schedule, a borrower becoming unable to repay debt later, a buyer failing to complete installment payments under a contract, or a seller delivering goods late due to liquidity problems. These situations lead to civil lawsuits and proceedings under the law. If there is no evidence demonstrating dishonest intent from the beginning, it remains a matter of civil litigation to claim damages rather than criminal prosecution.
An Important Note: The difference between the Offense of Fraud and a Civil Breach of Contract lies not in the result of the damage, but in the intent and circumstances at the inception of the legal relationship. If there was dishonest deception from the very start that resulted in obtaining property, it constitutes a criminal case of fraud. If it is merely a failure to comply with a contract without prior intent to deceive, it is a dispute under civil law.
