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Embezzlement
What is Embezzlement?
Embezzlement is the act of dishonestly appropriating or secreting
assets, usually financial in nature, by one or more individuals to whom
such assets have been entrusted.
Embezzlement is a kind of financial fraud. For instance, a clerk
or cashier handling large sums of money can embezzle cash from his or
her employer, a lawyer can embezzle funds from clients' trust accounts,
a financial advisor can embezzle funds from investors, or a spouse can
embezzle funds from his or her partner. Embezzlement may range from the
very minor in nature, involving only small amounts, to the immense,
involving large sums and sophisticated schemes.
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Embezzlement is often performed in a manner that is
premeditated, systematic and/or methodical, with the explicit intent to
conceal the activities from other individuals, usually because it is
being done without their knowledge or consent. Often it involves the
trusted person embezzling only a small proportion or fraction of the
funds received, in an attempt to minimize the risk of detection.
If
successful, embezzlements can continue for years (or even decades)
without detection. It is often only when the funds are needed, or called
upon for use, that the victims realize the funds or savings are missing
and that they have been duped by the embezzler. |
Embezzlement is a statutory offense so the definition of the
crime varies from statute to statute. Typical elements are 1) the fraudulent
2) conversion
3) of the property
4) of another
5) by a person who has lawful possession of the property. Embezzlement is a crime
against ownership; that is, the owner's right to control the disposition
and use of the property. The conversion element of embezzling
requires a substantial interference with the true owner's property
rights (unlike larceny, where the slightest movement of the property
when accompanied by the intent to deprive one of the possession of the
property permanently is sufficient).
The requirement that the conversion be fraudulent means simply that the
defendant willfully and without claim of right or mistake converted the
property to his or her own use. The type of property that is the subject
of embezzlement varies among jurisdictions. Embezzlement statutes do not
limit the scope of the crime to conversions of personal property.
Statutes generally include conversion of tangible personal property,
intangible personal property in action. Real property is not
typically included. The critical element is that the
defendant must have been in lawful possession of the property at the time of the
fraudulent conversion and not have mere custody of the property.
If the defendant had lawful possession the crime is embezzlement.
If the defendant merely had custody, the crime is larceny.
Determining whether a particular person had lawful possession or mere
custody is sometimes difficult. |
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