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Embezzlement

Embezzlement

The crime of embezzlement is found in Virginia law under code section Va Code 18.2-111. The legal definition of embezzlement under Virginia law is as follows:

“If any person wrongfully and fraudulently use, dispose of, conceal or embezzle any money, bill, note, check, order, draft, bond, receipt, bill of lading or any other personal property, tangible or intangible, which he shall have received for another or for his employer, principal or bailor, or by virtue of his office, trust, or employment, or which shall have been entrusted or delivered to him by another or by any court, corporation or company, he shall be guilty of embezzlement.”

This complicated and long winded definition of embezzlement can be broken down into five elements:

  1. The defendant must have a “trust” relationship with the victim (such as an employee or agent).
  2. That property came into the defendant’s  possession or care because of that trust relationship,
  3. The property belongs to someone other than the defendant,
  4. The defendant hid, stole or transferred the property without permission
  5. The defendant hid, stole or transferred the property with the intent to steal.

The biggest difference between embezzlement and classic larceny is that larceny involves taking possession of something without any permission. Embezzlement involves stealing something that you had permission to have but did not own.

Some classic examples of embezzlement include:

  • A store cashier putting customers’ money in their pocket.
  • An accountant spending his client’s money instead of paying the client’s taxes.
  • An employee stealing office supplies or equipment
  • A store clerk taking merchandise home with them.
  • An employee purposely damaging merchandise so that they can take it home or buy it cheaper.
  • A manager using the company credit card to make unauthorized purchases for himself.

Does the Defendant have a special trust relationship with the victim?

Embezzlement must involve breaching a special trust relationship that we call a fiduciary. A fiduciary relationship is a business relationship where one party trusts the other to act with complete loyalty and integrity in regards to that business transaction.

Most embezzlement cases involve the fiduciary relationship between employees and employers. However, there are other types of fiduciary relationships. Accountants, lawyers, stock brokers, wealth managers, managers of a trust all have a fiduciary relationship with their clients.

One of these special fiduciary relationships must exist between the defendant and the victim for larceny to become embezzlement.

Was Contact With The Property Part of the Trust?

Embezzlement must involve stealing something that was entrusted to the defendant as part of their job or fiduciary relationship with the victim.

For example, if cashier pockets money from the till, that is embezzlement because handling the money in the cash register is part of the job.

However, if the same cashier steals money from a coworker’s wallet this is plain larceny not embezzlement because handling the coworkers’ money is not part of the employment.

Did The Property Belong to Someone Else?

When dealing with corporations, business and their agents it can be hard to sort out who actually owns the property.

If you give $500 to an accountant to prepare your taxes and he takes the money and runs away, he has not committed embezzlement because the money belonged to the accountant.

However, if you give $500 to your accountant with instructions to use the money to pay your taxes, and then the accountant runs away with the money that is embezzlement because the money did not belong to the accountant. The accountant had possession of the tax money but he did not own the money.

Did the defendant actually hide or take the property?

When property disappears from an employer it can be hard to prove who took it. Without a confession or being caught “red-handed” most embezzlement cases can be very speculative.

Proving that a specific employee could have stolen the property is not enough, the court must prove that the property was actually stolen and that no one else could have done it.

Even if the police can prove that a defendant embezzled some money or products, there is often difficultly proving how much was taken.

Employers routinely lose money, supplies and merchandise through accidents, accounting errors, shoplifting and other incidents. When an employee gets caught embezzling the employer is often tempted to then blame all account and inventory discrepancies on the embezzler.

Did the defendant intent to steal?

Losing, taking, destroying, damaging your employer’s property is not embezzlement unless you had the intent to embezzle.

Accidents and mistakes are not embezzlement even if they are very stupid mistakes. For example: If an employee accidentally loses $5,000 in bank deposits on the way to the bank that is not embezzlement.

One of the classic ways that the court proves or disproves an intent to embezzle is by whether the defendant benefited or expected to benefit from the act.

For example, if a bank teller gives a customer an extra $100 bill, that is probably just an accident and not embezzlement. But if that customer is the bank teller’s boyfriend and they later split the money, that financial benefit may be used to prove a guilty intent.

Embezzlement is Punished the Same as Larceny

Embezzling property worth $200 or more is a grand larceny and is a felony. Felony embezzlement is punishable by a maximum of 20 years in prison and $2,500.

Embezzling property worth less than $200 is punished the same as petite larceny and is a class 1 misdemeanor the first time you are convicted. This means that the maximum penalty for misdemeanor embezzlement is up to 12 months in jail and $2,500 in fines.

A second conviction for misdemeanor embezzlement or being convicted of embezzlement with a prior larceny type offense on your record comes with a minimum jail sentence of 30 days and a maximum of 12 months.

A third conviction for misdemeanor embezzlement or being convicted of embezzlement with two or more prior larceny type offenses on your record is a class 6 felony and comes with up to 5 years in prison and up to $2,500 in fines.

An experienced criminal defense attorney should be able to give you a relatively accurate prediction of the likely outcome of your case after they have had a chance to discuss the facts of your case.

Conviction for any form of embezzlement can have serious effects on a person’s life. When an adult is convicted that conviction stays on their permanent criminal record forever. There are no exponents for any embezzlement convictions in Virginia.

Conviction for embezzlement can effect job applications, security clearance, applications to graduate school, professional licensing and can result in deportation. A Felony conviction can result in loss of certain civil rights; such as, gun ownership and voting rights.

The Single Larceny Rule Applies to Embezzlement:

When a person is caught stealing multiple items there is questions regarding how many crimes are committed.

For example, if I am a cashier and I steal three $100 bills from the cash register did I commit one $300 felony embezzlement or three $100 misdemeanor embezzlements?

The “single larceny doctrine” is a rule that governs when stealing or embezzling multiple items becomes one crime or multiple crimes. The single larceny doctrine states that stealing multiple items is one crime when the embezzler committed the embezzlement as part of a single act and a single intent.

The court will weigh the following factors in determine whether the single larceny doctrine applies:

  • the location of the items embezzled,
  • the lapse of time between the takings
  • the intentions of the thief,
  • the number of owners impacted, and
  • whether intervening events occurred between the takings

Here are some real examples of when the single larceny doctrine does and does not apply:

  • Stealing two purses, owned by two people from the same location at the same time was a single larceny.
  • Stealing a purse, a radio, and wallet from different people at different locations within a hospital all in the same day constituted three separate larcenies.
  • Embezzling from a church five times over 25 months is five separate crimes when each time the defendant intended that theft to be his last.
  • Stealing jewelry for money, a rifle for protection, and a car in order to escape, all at the same home, from the same owner, at about the same time were three separate larcenies because they were each part of a separate intent or plan.

If you have been charged with embezzlement call Nichols & Green pllc for a free consultation (703) 383-9222

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