Proving You Did Not Know: Legal Guide

What is the knowledge element?

In criminal law, what the accused person knew at the time can matter. In a mule account case, a key question is: did you know your account was being used for crime?

This matters because the three mule account sections cover different acts ^[f1]. Your defence starts with understanding the section that applies to you.

What do sections 424A and 424B cover?

Section 424A covers possessing or controlling someone else’s account or payment card. Section 424B covers giving control of your own account to another person without lawful authority or lawful purpose ^[f2].

What you knew, and why you did it, matter to your defence. That makes “I did not know” worth raising. The general exceptions in Chapter IV of the Penal Code may also give you a defence, depending on the facts. The question is whether one of those exceptions fits your situation.

What does section 424C cover?

Section 424C covers engaging in a transaction through an account without a lawful purpose ^[f4]. It also carries the heaviest penalty of the three.

The reason you made or allowed each transaction matters. A lawful purpose, backed by evidence, is central to your defence.

What are the Chapter IV general exceptions?

Chapter IV of the Penal Code sets out general exceptions that apply to all criminal offences, including the 424 sections ^[f3]. They can give you a defence, depending on the facts.

For mule account cases, the most relevant are section 79 (mistake of fact) and section 80 (accident) ^[f5]. Each works differently and fits different facts.

It is up to the defence to raise an exception. Your lawyer can advise how much you need to show.

What is mistake of fact under section 79?

Section 79 says an act is not an offence if the person is justified by law. The same applies if, because of a mistake of fact (not a mistake about the law), they believe in good faith that they are justified by law.

In practice, if you held someone else’s account honestly believing you were lawfully allowed to, section 79 may apply. The mistake must be about the facts, not about what the law says.

For example, a friend asks you to hold their account for a while, for what sounds like a lawful reason, and you believe them. Whether that counts as a mistake of fact depends on the evidence. The court will ask whether your belief was reasonable in the circumstances.

What evidence helps show you did not know?

Any defence based on not knowing rests on evidence. Start gathering records now, because more evidence gives your lawyer more to work with.

Messages can be the most useful. Texts, emails, WhatsApp chats and call logs showing how you came to be involved can show what you knew and when. If someone lied to you about the purpose, those messages are key.

Bank statements showing your normal pattern of use set a baseline. If the suspicious transactions do not match how you usually use your account, that supports the case that you did not arrange them. Our evidence preparation guide lists what to collect.

Employment records, business letters and anything showing the lawful source of your money also help. The aim is to show what you knew and why you acted.

What is the difference between not knowing and being careless?

Courts separate not knowing from ignoring what you should have noticed. This matters when a court looks at what you knew.

If there were warning signs and you ignored them, the court may not accept that you did not know. Warning signs include being paid to process transactions, taking instructions from strangers, unusually large or frequent transfers, and pressure to act fast without asking questions.

If there were no reasonable warning signs, your account of not knowing is more believable. That is why you should record the circumstances of each transaction. A lawyer can help you see which facts help you and which the prosecution may use against you.

What happens in court?

In court, the prosecution brings evidence to prove each part of the offence. The defence then challenges that evidence and brings its own.

The prosecution may point to indirect evidence of what you knew. This includes the size of the transactions, how fast money moved, messages with others charged with you, and any payment you received.

The defence answers with evidence that you did not know: lawful reasons for the transactions, proof that others deceived you, your cooperation with the authorities, and the Chapter IV exceptions. The investigation and court process guide explains each step.

How does a lawyer build this defence?

A lawyer starts by checking which section applies and what the prosecution must show for it. That shapes the defence from the start.

In any of the three, the lawyer checks whether a Chapter IV exception applies, tests the prosecution’s evidence and builds your side of the story.

Get advice early, because the evidence you gather now shapes everything after. If the police have contacted you or you are under investigation, a lawyer can tell you where you stand on knowledge and which defence is strongest.

Sources

1. Penal Code (Act 574), Sections 424A, 424B, 424C
2. Penal Code (Act 574), Chapter IV: General Exceptions, Sections 79, 80
3. Low & Partners, “Keldai Accounts: When Helping a Friend Becomes a Criminal Offence” (2024)
4. Raj, Ong & Yudistra, “Unveiling the Mystery: When Your Bank Account Gets Frozen by the Law” (2024)
5. Penal Code (Amendment) Act 2024