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Understanding embezzlement and the misappropriation of assets

On Behalf of | Jul 27, 2021 | White-collar Crime

Embezzlement, the misappropriation of funds that were entrusted to you, is a serious accusation to face. Embezzlement happens when someone uses funds for a purpose other than what they were intended for.

Here’s an example. If your client gives you money to invest in a particular stock and you instead use it to buy something for your office, that’s already a violation of your fiduciary duty. If you then give them a receipt that claims you did invest it as they asked (but this is untrue), then you could be accused of embezzling those funds.

Embezzlement doesn’t have to occur in a big scheme

While people often think about embezzlement happening on a grand scale, it actually can happen with very little money or few assets involved. Something as simple as stealing a few dollars from a cash register at work (called skimming) could result in embezzlement charges. In grander cases, it may be a worker who steals thousands of dollars by claiming that they transferred money into clients’ accounts when that money really went to their own.

Embezzlement is a misappropriation of funds or assets

Embezzlement happens when someone uses assets or money that they were meant to safeguard in an inappropriate way. It’s not exactly fraud, even though the two crimes are similar, because those who embezzle have legal access to the assets that they have misused.

Is it possible to accidentally embezzle?

It could be. For example, if your boss comes to you and asks you to transfer a specific amount of money to a certain account and you do it without question, you may have just participated in an embezzlement scheme unknowingly. Misusing a company credit card to purchase something for your home because you forgot to switch over the card in your digital account could lead to embezzlement charges as well.

In most cases, if you didn’t know you were committing a crime or were not intending to commit one, then you will have a defense against embezzlement charges. Despite this, the charges may persist, so it’s worth understanding the risk of penalties and taking steps to defend yourself.