When is a failed investment actionable scam?

When promised profits fail to materialize, investors often feel cheated. But is a ‘bad deal’ or an unfulfilled promise legally actionable fraud? The answer is nuanced: the existence of valid contracts and invoices can complicate proof of actionable fraud. A ruling of the Court of Cassation of December 30, 2025, confirms that not every financial setback is a criminal case, even if large sums are involved.

The facts: disappointed investors and high bills

In this case, which led to the December 30, 2025 ruling, several investors (civil parties) were opposed to a service provider and its companies. The investors had paid substantial sums of money - in one case even more than 1.4 million euros - for services related to real estate projects and files with an urban planning slant.

The defendants were prosecuted for fraud, abuse of trust and forgery. The investors claimed they were misled by false projections of “hallucinatory profits” and that the contracts were merely a cover for scams. However, the Ghent Court of Appeal acquitted the defendants, ruling that there was reasonable doubt of fraudulent intent. The duped investors then went to the Court of Cassation.

The decision of the Court of Cassation.

The Court of Cassation rejected the investors' cassation appeal and upheld the acquittal.

The crux of the decision rests on the finding that the payments were founded on formally valid agreements and invoices. The Court followed the reasoning of the Ghent Court of Appeal that:

• Investors over a long period of time were satisfied with performance and paid invoices without protest.
• Knowledgeable payments were made.
• Performance did occur, with the question of whether the price was commensurate with the quality being a civil (contractual) discussion, not a criminal one.

The Court ruled that the mere fact that profit forecasts did not come true or that a person presents himself as an expert (“Legal and expert Consulting”) is not automatically sufficient to constitute “cunning tricks” within the meaning of Section 496 of the Criminal Code .

Legal analysis and interpretation

This ruling touches on the essence of the distinction between civil contract law and financial criminal law. A conviction for fraud (Section 496 Sw.) requires more than default or lies alone.

1. The constitutive components of fraud

Fraud requires the use of cunning tricks (such as false names, false capacities or other maneuvers) for the specific purpose of being handed monies. In this case, the plaintiffs argued that the contracts themselves were part of the cunning tricks. However, the Court held that when parties sign an agreement and perform it over a long period of time (with invoices being paid), it indicates a contractual relationship. Unless it is conclusively proven that the contract itself was an instrument of deception, the discussion remains in the civil law realm.

2. Deceptive intent vs. contractual fault

An important element is deceptive insight at the time of the facts. The Court confirms that doubt about this intent plays in the defendant's favor. The fact that, in retrospect, it appears that the services rendered may not have been worth the amounts billed does not make it a crime. As the judgment states: “the question of the extent to which the services provided by the defendants justify the amounts billed [is] a contractual and therefore civil dispute”.

3. Falsehood and titles.

The consideration of the term “Consulting” is interesting. The defendant used the term “Legal and expert Consulting” without being a lawyer. The Court noted that “Consulting” is not a legally protected title. The fact that someone claims expertise gained through experience in the real estate industry, even without a specific degree, does not suffice as evidence of assuming a false capacity.

What this specifically means

This ruling has implications for both entrepreneurs and investors in Belgium.

• For investors and customers:
  • Duty to investigate: Be extremely critical of profit projections. If you sign contracts and pay invoices without protest, you weaken your position to file criminal complaints later.
  • Terminology: Terms such as “Consultant” or “Expert” are not always protected. Check diplomas and accreditations (such as BIV numbers for real estate brokers) through official channels.
  • Protest in a timely manner: Are you dissatisfied with a performance? Protest the invoice immediately and in writing. Tacit payment is often considered acceptance of performance.
• For service providers and entrepreneurs:
  • Contractual clarity: Make sure you have clear, written agreements. This is your first line of defense against allegations of fraud.
  • Billing: Detailed invoices referring to services rendered and paid for by the customer are strong evidence against any subsequent claims of fraud.

Frequently asked questions (FAQ)

What is the difference between a contractual breach and fraud
In a contractual breach (civil law), a party fails to honor its agreements, for example by delivering poor work. With fraud (criminal law) there must be fraudulent intent as well as the use of cunning tricks (such as a false name or staging) to cheat someone out of money.

Is “consultant” a protected title in Belgium?
No, unlike, say, a lawyer, architect or real estate broker, “consultant” is not a legally protected title. Anyone can basically call themselves a consultant, which increases the importance of due diligence for the client.

Can I get my money back if the criminal court acquits the other party?
If the criminal court acquits, your claim as a civil party in the criminal case is usually dismissed (as in this ruling). You can still try to seek damages through the civil court based on contractual errors, but the burden of proof is different.

Conclusion

The December 30, 2025 ruling reminds us that criminal law is the ultimum remedium in Belgium. Not every unethical business practice or bad investment is criminal. For victims, the distinction between civil litigation and a criminal case is often frustrating, but legally essential. Correctly qualifying the facts and gathering evidence of fraudulent intent is specialized work.