When funds go missing in the workplace, accountants, bookkeepers, and bankers are often charged with embezzlement. Individuals may, however, be charged with embezzling money from others. Embezzlement is a form of fraud that occurs when property – usually but not always money – is taken by an individual to whom it was entrusted, according to California Penal Code 503. Whether in a private or public environment, it is a serious crime.


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Find a California Criminal Defense Lawyer for Embezzlement Charges

"Embezzlement" and the Basics

Embezzlement is described as the dishonest taking of personal property with which one has been entrusted under Penal Code section 503. Embezzlement is a form of fraud that is one of the most common white-collar offenses. Though embezzlement is most commonly associated with the workplace, it may also occur in other situations, such as when a fiduciary steals from someone who has entrusted them with property or assets (for example, a financial broker skimming money from a client's account). To commit embezzlement, all you have to do is take someone's property that has been entrusted to you and turn it to your own use with the intent of depriving the owner of the property's use. Money is included in the definition of land.

Although we often hear of high-profile embezzlement cases involving large sums of money, embezzlement can occur even when the amount of money or the value of an object is insignificant.

Let's say a store clerk is caught taking a $5 bill from the register at the end of the day because he was short on cash and needed to pick up a loaf of bread on his way home. According to California law, the clerk committed embezzlement because he wanted to use the shop owner's money for his own gain, despite the fact that the owner had placed her trust in the clerk to keep the money safe for her. What's more, guess what? The purpose of repaying embezzled money or property is not a defense, even though the clerk found it a loan and planned to put a $5 bill back in the ledger the next day.

Petty theft is defined as the theft of a small amount of money, such as $5 from a store clerk, while grand theft is defined as the theft of any property (or money) valued at more than $950. Petty theft is a misdemeanor, while grand theft is either a misdemeanor or a felony (called a "wobbler offense" under California law).

Frequently, a person charged with criminal embezzlement may also be named as a defendant in a civil case. An embezzler who steals from his or her employer, a broker who appropriates his or her client's property for his or her own use or a trustee who skims from the trust are all situations that can result in criminal charges as well as a civil case. The criminal case takes priority under California law. Since the outcome of the criminal case could, and most likely will impact the accused embezzler's civil liability, it is critical to contact a defense attorney who has experience defending criminal embezzlement charges.

According to California law, the legal definition of embezzlement is:

Embezzlement is described in California by Penal Code 503 Embezzlement Laws. Embezzlement, according to the law, is the wrongful and illegal use of someone else's property or funds by someone to whom it has been entrusted. This clause is violated by both private and public bodies. Private and public trustees, for example, are also in violation of the law if they defraud their clients of substantial amounts of money.

Embezzlement could also include small sums of money on a smaller scale and in a variety of small and medium-sized businesses. Embezzlement is described as using someone else's money in an unapproved manner that would indicate some breach of the entrusting party's terms. Embezzlement charges, on the surface, seem to include any sum of borrowed money, land, or funds. The act may be carried out for the embezzler's own benefit, putting the entrusting individual's assets at risk. The value of property or funds considered in embezzlement charges is a common source of concern. Regardless of the amount, any illegally appropriated funds or property is embezzlement. Someone may be entrusted with funds to care for an infant or an elderly person, for example. The entrusted party has the option of using the funds for their own benefit. As a result, the individual may face charges under Penal Code 503 PC.

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Embezzlement vs. Theft: What's the Difference?

Embezzlement is not the same as fraud. Despite the fact that both crimes involve assets, they are not distinguished based on the value of misappropriated funds. Instead, they differ from the legal definition of embezzlement, which is the term "entrusted." 'Any person liable of fraudulently appropriating funds that have been entrusted to him/her remains guilty of theft,' according to California Penal Code 484. Penal Code 503 classifies 'entrusted theft' as a more serious and disastrous type of theft because of the place of trust.

Grand theft, as described by PC 487, occurs when the value of the property taken exceeds $950; this is a felony charge in many embezzlement cases. According to PC 484, petty theft is described as taking property worth less than $950. The prosecutor in several embezzlement cases will attempt to sue you for each time you allegedly embezzled the land. For example, if you embezzled $1,000 every day for five days, the prosecution will file five counts of grand theft embezzlement against you.

Embezzlement

While the distinction between fraud and embezzlement appears minor, it is based on the defendant's place of confidence in relation to the property and how the defendant acquired the property in that relationship.

The following are some examples of embezzlement:

  • When a mover is employed to move a homeowner's belongings from one home to another, he or she takes some of the furniture with them.
  • When a caretaker is charged with making purchases and handling an elderly person's finances, he or she takes some of the money.
  • A lawyer withdraws funds from a client's trust account and uses them for personal gain.

The majority of Penal Code 503 PC Embezzlement cases in California arise in a variety of work settings. In several businesses, several workers have been granted access to the company's bank accounts and credit card numbers.

Embezzlement, on the other hand, may happen in sophisticated Ponzi schemes designed to steal money or property from investors.

The Embezzlement Conviction Process: What Must Be Proven?

The process of convicting people accused of embezzlement starts with determining the steps taken to defraud the land. An inquiry must first establish that the defrauded party and the defendant have a relationship. The prosecutor and jury must also find evidence that the defendant intended to appropriate the funds. The court must also prove that the accused wanted to use the funds for their own gain, in addition to appropriating them.

The circumstances underlying the embezzlement will also influence the accused's conviction. The prosecutor decides whether the case is a crime or a misdemeanor based on these factors. A wobbler is a case that can be prosecuted as either a misdemeanor or a felony. The district attorney considers the accused's criminal background, the value of the land, and the circumstances surrounding the embezzlement. Both of these considerations play a role in determining whether the case will be filed as a felony or a misdemeanor. The extent of complexity involved with embezzling the funds is also taken into account by the district attorney. The attorney would file the case as a crime if the scheme required a significant amount of time spent preparing and was riddled with deception.

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Your defense attorney will assist you in changing the investigation stage after a lawsuit has been filed against you. If the case has not yet been filed by the district attorney, your embezzlement lawyer might be able to persuade the prosecutor to file it as a misdemeanor. Where it appears that the accused may face severe punishment if charged with a crime, the counsel can use your personal records and a review of your life to convince the jury. It is possible to describe the filing as a misdemeanor if you have no prior criminal record. Early intervention is beneficial in the majority of situations, if not all, where criminal offenses are suspected.

There's also the possibility that you're not guilty. The confusion may have been caused by a blunder on both parties' parts. A thorough defense would provide evidence that you were legally entitled to the property or that you were entrusted with the rights in some way. In such a scenario, the prosecution's evidence of criminal intent may be quickly dismissed. To prepare a case against embezzlement claims, a skilled criminal defense attorney can go over all of the documents and any forensic evidence. This step is critical because it identifies any contradictions or errors that may lead to the case being dismissed or a guilty plea is entered.

Embezzlement cases under California Penal Code 503

Many actions are included in the definition of embezzlement, which includes both names, "entrusted" and "unapproved use." For example, breaking CA Penal Code 584 PC would be a violation of the California embezzlement law. The latter code, which is a type of Business and Professional Code, regulates an organization's use of funds and services. As a consequence, even the smallest of acts, such as driving your wife to work in a company car, may result in charges of embezzlement as well as a breach of Penal Code 584. This will be considered a misdemeanor, but it would also be a criminal offense. Two examples of embezzlement deeds are given below.

Scenario #1: Software may be set up by a financial system administrator who is connected to and entrusted with a commercial bank's centralized ledger. A software like this will be used to move a certain sum of money to each customer's account. Despite the fact that the pinching from customers appears to be minor, the act nevertheless falls under Penal Code 584. The meager sums snatched often imply a sizable share on the part of the system administrator. The charges here could be filed as a felony in such cases.

The first allegation is that the small sums of money are not the machine administrator's property. As a result, even though the crime goes undetected, it remains a criminal offense. In this scenario, the company has granted a property trust to one of its employees. The trusteeship may be temporary or permanent in some cases. Temporary in the sense that, unlike the system administrator, a car wash agency can be temporarily entrusted with vehicle ownership rights while the vehicle is being cleaned.

 

Scenario #2: In the second instance, as in the case of the car wash agency, an individual is entrusted with temporary rights to another's properties. The agency may decide to lend the car to someone else, sell it, use it without the owner's permission, or remove a functional component of the car and replace it with an older, less expensive version. Such actions will be punishable under Penal Code 503 as an embezzlement misdemeanor.

Other Embezzlement-Related Charges

Embezzlement is described as one of five criminal offenses. The aspect of trusteeship is the only difference between them. If the feature of trusteeship is not present, the defendant may be charged with one of the five charges mentioned below. They are as follows:

Grand Theft Auto is a video game developed by Rockstar Games. Penal Code 487a defines this offense. Grand theft is a more serious type of theft in which a large amount of property or money is taken from someone without their consent. For a grand theft conviction, the property in question must be worth more than 950 dollars. This is also a wobbler of an offense. As a result, it can be charged as a felony or a misdemeanor. When charged with grand theft as a crime, the defendant faces up to one year in county prison and a maximum fine of $1000. If you are convicted of a crime, you may face a sentence of up to three years in prison and a fine of up to $10,000.

Burglary, as described by Penal Code 459 PC, occurs when someone enters someone's property without permission with the intent to commit a felony. The prosecutor's position in a burglary case is to rely on evidence of a burglar breaking into a house, a space, a locked car, or a commercial property with the intent to steal. Burglary can be classified into two types: first-degree burglary and second-degree burglary. A first-degree burglary conviction carries a maximum penalty of six years in jail. The second degree is a crime that will result in a sentence of up to three years in prison. Burglary is another wobbler offense that can be classified as a misdemeanor or a felony, depending on the circumstances.

Petty theft is described as the act of taking money or property worth less than $950 without the owner's knowledge under California law's section 484 PC. If livestock is stolen, the total value does not exceed $250. Petty theft is normally punished with a maximum fine of $1000 and a six-month prison sentence as a misdemeanor. If the amount stolen is less than $50, the crime may be classified as an infraction. In the latter case, the defendant will face a fine of $250.

A forgery offense falls under California Penal Code 470 PC, which covers a wide range of offenses. Falsely impersonating a will, a check or fake insurance claims are all examples of forgery. The prosecution must prove that the defendant tried to defraud the complainant by falsifying a written document and altering it to his or her benefit. The offense is a shaky one. As a misdemeanor, it carries a maximum sentence of 364 days in prison. When the defrauded sum is less than $950, a forgery misdemeanor is committed. The crime may result in a sentence ranging from 16 months to three years in prison. To successfully defend against forgery, the accused would require well-versed criminal defense lawyers.

Receiving Stolen Property in Custody. The act is characterized as a breach of Penal Code 496 PC, and it includes charges of accepting custody of property that is not theirs. The allegation would also include whether the property owner had given permission for the accused to have their property in his or her possession. The charges are common, but since prosecutors are not able to show how the property was robbed, the law focuses on who is in actual possession of the property after it has been stolen. The person in possession of the stolen property may be charged with both stealing and obtaining stolen property in some jurisdictions.

It's worth noting that you could be charged with two or more of these crimes in addition to embezzlement. In such cases, your criminal defense lawyer will want to lessen the charges, mostly to prevent criminal charges.

What Needs to Be Proven for a Conviction?

The crime of embezzlement is described simply and plainly in Section 503 PC of the California Penal Code. In order for a prosecutor to convict a defendant of PC 503 embezzlement, they must prove all of the elements of the white-collar crime.

Elements of the crime

These are referred to as "elements of the crime" in the legal community and are classified under CALCRIM 1806 Jury Instructions:

  • The owner entrusted the defendant with the property
  • Since the defendant's owner had faith in him, he did so
  • Defendant defrauded land by fraudulently converting or using it for their own gain
  • The defendant intended to deprive the owner of the property's use

As you can see, there is usually an employee-employer arrangement in which the defendant was entrusted with the victim's money or property.

With Intent to deprive

It must be proven that the defendant tried to deprive the property owner in order to be found guilty. A conviction may be obtained even though the purpose was only temporary.

Even unless the property was returned before charges were filed, having an intent to return it is not a legitimate defense for PC 503 embezzlement.

Embezzlement Punishment

Embezzlement is often classified as a petty crime or a grand theft offense. When the amount embezzled is less than 950 dollars, the embezzlement is considered a misdemeanor. A misdemeanor embezzlement conviction carries a maximum prison sentence of six months and a court fine. When the amount defrauded reaches 950 dollars, the criminal act is upgraded to a wobbler. It means it will be charged as a felony or a misdemeanor from now on.

Crimes Related to Embezzlement

  1. Penal Code 504 PC – Embezzlement by a public officer
  2. Penal Code 424 PC – Misappropriation of public funds
  3. Penal Code 459 PC – Burglary
    • The serious theft crime of burglary is described in California Penal Code Section 459. Burglary is described as entering an inhabited dwelling without permission with the intention of committing a serious crime within.
    • Penal Code Section 459, on the other hand, modifies and broadens the common law meaning of burglary to include much more behavior than the average person thinks of when they hear the term.
      • First vs. Second Degree Burglary
      • Burglary in California is classified into two levels: first and second. The more extreme of the two is the first-degree burglary.
      • Penal Code Section 459 defines it as entering a house, a room within a building, or a locked vehicle or structure with the intent to commit a crime therein, with the defendant either stealing or intending to steal $950 or more in goods, entering a non-commercial structure, or entering a commercial structure outside of regular business hours.
      • The building in question must be a "residence" in order to be considered a first-degree burglary. Structures that are not conventional homes, such as houses or apartments, are classified as residences.
      • Houseboats, RVs, and any occupied portion of a structure, even if it also has a commercial function, such as a shopkeeper who lives in a room within a store, are all considered residences. If the house, structure, or space inside a structure is not a dwelling, the same behavior that counts as the first-degree burglary qualifies as second-degree burglary.
  4. Penal Code 470 PC – forgery
  5. Penal Code 484 PC – petty theft
  6. Penal Code 487 PC – grand theft
    • Theft is the unlawful taking of another's valuable property without their permission and with the intent to permanently deprive the victim of the property's value. The criminal code of California distinguishes between various levels of robbery. Theft can be either "large" or "tiny."
    • In de minimums cases involving minor loss amounts and retail retailer victims, the case can be referred to as "shoplifting" rather than theft. This article focuses on grand theft, which is described by Penal Code Section 487 as a more severe type of theft under California law.
    • Grand theft is a catch-all offense that is used to prosecute a variety of thefts, including those committed through deception, trickery, or physically taking objects without consent. As a result, it's not unusual for those charged with grand theft under PC 487 to also be charged with embezzlement, theft through false pretenses, insurance fraud, healthcare fraud, real estate fraud, worker's compensation fraud, credit card fraud, sales tax violations, or other financial crimes.
  7. Penal Code 496 PC – Receiving stolen goods
    • For those without a law degree, it is likely common knowledge that any form of theft is illegal under California's criminal laws. The rule, however, does not only apply to those who steal property from others directly but also to those who obtain stolen property after learning it is stolen.
    • Receiving stolen goods, as specified by California Penal Code Section 496, is a felony. If someone buys, conceals, receives, or sells stolen goods, they are breaking the law.
    • The following is taken from Penal Code 496:
      • "Any person who buys or receives property that has been stolen or acquired in any manner that constitutes robbery or extortion, knowing that the property has been stolen, or who conceals, sells, withholds, or aids in concealing, selling, or withholding property from the owner, knowing that the property has been stolen or obtained."
    • A case where someone tries to support a friend by hiding property in their home, knowing it was robbed in a robbery, is a typical example of Penal Code 496 crimes.
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Embezzlement Punishment

Embezzlement, like fraud, can be classified as a misdemeanor or a crime depending on the value of the property taken.

  • Embezzlement of less than $50 in value can be considered an infraction, punishable by a fine . This choice is not available if the defendant has previous fraud or other convictions, and he or she will be charged with a misdemeanor.
  • Embezzlement of less than $950 in value is considered a misdemeanor. The offender faces a maximum sentence of six months in prison and a fine.
  • Grand theft, which can be a misdemeanor or a felony, is prosecuted when someone allegedly embezzles more than $950 in property. A misdemeanor conviction carries a maximum sentence of one year in prison. A felony, on the other hand, will result in up to three years in jail.

In California, the embezzlement of public funds is handled differently. If anyone is accused of stealing public funds, they will be charged with a crime. A conviction not only carries fines and the possibility of jail time but also disqualifies the individual from holding positions in local or state government.

An Embezzlement Claim's Exacerbating Factors

When aggravating factors are present, many offenses carry harsher punishments, such as higher fines and longer jail terms.

Such aggravating factors in the case of embezzlement under California law are:

  1. Taking from elderly or helpless people
  2. The white-collar crime enhancement is applied when a criminal is convicted of two or more felonies involving fraud or embezzlement in the same case, resulting in a loss of more than $100,000 to another individual

Who Can Be Charged of Embezzlement?

The act of misappropriating funds or property that has been entrusted to an individual by a company is known as embezzlement. As a result, someone hired by a company to oversee funds and/or property can be sued if he or she improperly appropriates such funds for personal benefit.

The most common perpetrators of embezzlement are a corporation, an employee, or an employer. It's not shocking that embezzlement often includes a high-ranking corporate official, such as:

  • Executive Vice President (CEO)
  • Managing Director of Finance (CFO)
  • Officer of a Non-Profit Organization
  • Leader of the Church
  • Figure in Politics
  • Director of Operations
  • CPA (Certified Public Accountant)
  • Broker of Investments
  • Broker of Real Estate

Embezzlement can affect any professional, including physicians and business owners, as well as anyone who has access to and influence over another's business assets or interests, regardless of how big or small the company is.

Popular Embezzlement Legal Defenses

The following points can be used by embezzlement defense lawyers to launch defense tactics for the accused:

An assertion that you had good faith rights to the land. According to California law, a defendant is not guilty of embezzlement if he or she claims (in good faith) that they had a right to the property in question. The defense relies on the fact that the defendant did not hide the act and carried it out in broad daylight. This argument technique would be aided by the fact that the defendant did not take the property because the entrusting party owed him/her a debt.

The accused did not intend to commit a crime. According to California law, the prosecution must show proof of evidence that the defendant tried to deprive the plaintiff of their property or use it for a limited time. Prosecutors face the most difficult task of nearly all criminal cases: proving criminal intent. The volume of financial data and paper evidence associated with embezzlement allegations demonstrates the severity of the cases. As a result, the evidence of intent acts as a great vulnerability for defense lawyers to exploit. This is because jurors agree that what should have been a reasonable sign that the defendant was involved in embezzlement was just a statistical error.

False Accusation. On a regular basis, prosecutors file a large number of false claims. When it comes to embezzlement cases, the allegations are much more frequent. Most of the defendants on these charges have been the victims of a vengeful act or a blame game over a squandered business deal. Since the accused may have had a previous business or personal relationship with the accuser, taking advantage of the plea of confidence becomes easier. The accuser has an easy time cornering the defendant in this case. Hiring an experienced defense lawyer is important in situations like this. To pitch a good defense, you'll need the help of a team of investigators and paralegal guidance from the right people. For both, bringing the story to light would be a breeze.

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