Embezzlement Laws

In many theft cases, the perpetrator and the property owner are strangers or have no particular relationship. Embezzlement may occur when a relationship of trust existed between them. The law takes this type of crime seriously. A defendant convicted of embezzlement may face years in prison and collateral consequences upon release. For example, they may struggle to get certain types of jobs with this conviction on their record. Someone suspected of embezzlement should not try to personally convince the police of their innocence. Instead, they should hire an attorney who can handle interactions with law enforcement for them.

What Is Embezzlement?

Embezzlement usually occurs when someone misappropriates property that was entrusted to them.

Elements of Embezzlement

Definitions of embezzlement vary by state. In general, though, the defendant must have been entrusted with certain property. Some situations in which this may happen include a cashier handling money for an employer, a trustee managing trust assets for beneficiaries, or a financial advisor making investments for a client. The prosecutor must show that the defendant abused the trust placed in them by intentionally misappropriating this property.

Some states, such as New York and Texas, do not have specific embezzlement statutes. These states treat embezzlement as a version of a more general crime like larceny or theft.

Examples of Embezzlement

Patrick, an employee at a retail outlet, collects and stores incoming shipments of goods. When a set of designer bags arrives, Patrick takes a bag from the shipment as a gift for his girlfriend.

Meanwhile, Phil is an attorney who receives advance payments from a client to cover the court costs of their case. Phil dips into the trust account containing these funds to buy golf clubs.

Offenses Related to Embezzlement

Other types of charges that a defendant might face in situations similar to those supporting an embezzlement charge include:

• Larceny: an unauthorized taking of someone else’s property with the intent to deprive them of it
• Forgery: perhaps an embezzler falsified documents to conceal their crime
• Misappropriation of public property: situations such as an official taking government funds for their own use
• Receiving stolen property: could be charged when someone takes an item that they know was embezzled

If a defendant faces multiple charges based on the same conduct, they might reach a plea bargain with the prosecution. This could involve pleading guilty to a lesser offense in exchange for getting a more serious charge dropped from the indictment.

Defenses to Embezzlement

Embezzlement is a complex crime, and a prosecutor must prove each element beyond a reasonable doubt. A defendant might argue that they did not have the intent to misappropriate the property. Perhaps a farmworker who was given seeds to plant by their employer left work without realizing that a few seeds were still in their pocket.

In other cases, a defendant might argue that they had the consent of the owner to take the property. Perhaps an employee received an item from their employer as a reward for their hard work. A defendant similarly might raise a "claim of right" defense if they believed in good faith that they held ownership of the property. For instance, the defendant might have genuinely but wrongly thought that they had received an item as a gift due to a misunderstanding.

A procedural argument might result in the suppression of evidence essential to the prosecution’s case. If the police found embezzled property through an unconstitutional search and seizure, for example, the defendant could ask the court to exclude this evidence from the case due to the Fourth Amendment violation. The prosecutor then might face more difficulty in proving the charge.

Penalties for Embezzlement

The length of imprisonment for embezzlement often depends on the value of the property. In California, for example, embezzlement involving property worth no more than $950 is a misdemeanor carrying up to six months in jail. Otherwise, it is a “wobbler” that may be charged as a misdemeanor or a felony. This may result in up to one year if it is charged as a misdemeanor, or 16 months or two or three years if it is charged as a felony.

Meanwhile, Georgia imposes the following penalties for embezzlement, known as theft by conversion:

• Up to 12 months if the property was worth $1,500 or less
• 1-5 years (or potentially up to 12 months) if the property was worth over $1,500 but less than $5,000
• 1-10 years (or potentially up to 12 months) if the property was worth at least $5,000 but less than $25,000
• 2-20 years if the property was worth at least $25,000

New York imposes the following penalties for embezzlement, which may be charged as petit larceny or grand larceny:

• Up to 364 days if the property was worth $1,000 or less
• Minimum term of 1-1.33 years if the property was worth over $1,000 but no more than $3,000
• Minimum term of 1-2.33 years if the property was worth over $3,000 but no more than $50,000
• Minimum term of 1-5 years if the property was worth over $50,000 but no more than $1 million
• Minimum term of 1-8.33 years if the property was worth over $1 million

A defendant convicted of embezzlement or an equivalent offense also may be ordered to pay a fine and restitution. Foreign nationals who commit embezzlement may face removal from the U.S. due to the nature of the conviction.

Last reviewed August 2024