The crime of embezzlement was created to fill a loophole in the theft/larceny statutes of English law. In old English law theft/larceny required a trespass, but there is no trespass with embezzlement. The person who embezzles is in lawful possession of the money or property, they just don't give it back to the owner or use it for unauthorized purposes.
Continue reading to learn about embezzlement law and when it applies as well as some examples of high profile embezzlement crimes in history.
The crime of embezzlement is where a person:
For instance, an office worker may have every right to handle the petty cash for a business, but the moment they use the petty cash to buy themselves new shoes without authorization, they have embezzled.
An important point about conversion, or the taking of the property, is that it has to be done with a serious intent of depriving the owner of their rights. Acts of embezzlement can include the following with respect to the funds/property of another:
It's important to note that merely moving property a short distance, or inflicting slight damage, or minimal use of the property may not be enough to constitute embezzlement.
This type of crime is most common in the employment and corporate fields. Generally, the person who commits embezzlement is a trusted employee who has been given access to someone else’s property or money for the purposes of managing, monitoring, and/or using the assets for the owner’s best interests, but then covertly misappropriates the assets for his/her own personal gain and use. These people are typically an employee, a business partner, or a contract worker. Common examples are bank tellers, store clerks, office managers, accountants, financial managers, or stock brokers.
Some embezzlers simply take large amounts of money at once, while others misappropriate small amounts over a long period of time. The methods used to embezzle can vary greatly and are often surprisingly creative. They can include fraudulent billing, payroll checks to fabricated employees, records falsification, “Ponzi†financial schemes, and more.
The crime of embezzlement does not have to be about money. The conversion of company property such as a laptop computers or company vehicles is also considered embezzlement. Sometimes state embezzlement statutes even include the taking of real property in addition to personal property.
The elements to prove the crime of embezzlement differ in the various state laws, but generally four factors must be present:
In addition to the corporate setting, embezzlement can also take place of public funds or property owned by the government. Several federal statutes prohibit embezzling public funds, tools for counterfeiting, records, or anything of value.
One of the most famous embezzlement cases in modern times is the Bernie Madoff case. Madoff used a Ponzi scheme to bilk his investment clients out of millions of dollars. Clients entrusted him with their life savings that he then used to fund his lavish life style -- a classic case of embezzlement.
Certainly, there are the big splashy embezzlement cases, but there is no shortage of small time players as well. The Girl Scouts regularly report cases of embezzlement of Girl Scout Cookie funds with stolen dollar amounts less than $50,000.
As you can see, the common elements to prove a charge of embezzlement leave a lot of room open for your defense. The government has the burden to prove all the elements of this crime under the laws of your state. However, it doesn't hurt to have a proactive defense that establishes facts disproving the elements. The key is having a strong and trusted advocate by your side, namely a criminal defense attorney.
