What is Embezzlement and What Are Defenses to the Crime?

Embezzlement is a type of white collar crime often prosecuted in Texas. It is defined as the unlawful appropriation of funds or other property by a person who has been entrusted with them. What distinguishes embezzlement from other theft crimes is that the victim has willingly granted control of the funds or property to another person, who subsequently misuses that control for personal gain.

Anyone handling another person’s property can be charged with embezzlement, though charges are most frequently brought against corporate executives, accountants and investment managers. Examples of embezzlement include the following:

• An employee with access to a company’s financial resources skims money off the top for personal use thus abusing their trusted status within the company.

• A financial advisor managing a client’s investments diverts those funds into their own accounts.

• A treasurer or board member of a non-profit organization misuses donated funds for personal expenses rather than fulfilling the organization’s charitable mission.

Texas has consolidated many embezzlement scenarios into the state’s general theft statute. However, prosecutors may also charge one under the Misapplication of Fiduciary Property or Property of Financial Institution statute as well. In both cases, certain unique elements must be proved to secure an embezzlement conviction. The defendant must have a fiduciary relationship with the victim, which means having a duty to put the latter’s interests before their own with respect to the entrusted money or other property. The defendant must have diverted the property without permission for a purpose other than what it was entrusted for. Lastly, the defendant must have acted with intent to deprive the owner of their property or funds.

Individuals accused of embezzlement can raise various defenses to counter the allegations, including the following:

1. Lack of intent — The defendant may be able to demonstrate that they had no intention to permanently deprive the owner of the funds or property.

2. Good faith — The defendant may be able to establish that they were using the funds or property for what he or she believed were legitimate purposes.

3. Consent — The defendant may be able to show that the owner of the property or funds gave consent for the use of them for the purpose in question.

4. No breach of fiduciary relationship — The defendant may be able to show that despite the unauthorized use of funds or other property, no financial harm resulted to the owner.

5. Lack of sufficient evidence — In some cases, the prosecution may lack concrete evidence to prove all the elements of embezzlement beyond a reasonable doubt.

If you are facing embezzlement charges under either statute, A knowledgeable theft crime defense attorney can pursue an effective strategy for obtaining the most positive results available.

A Texas theft crime conviction can bring severe and lasting consequences. Tylden Shaeffer, Attorney at Law, P.C. in San Antonio has the skill and experience to provide a strong defense. To schedule a free consultation, call (210) 227-1500 or contact us online.

By Tylden Shaeffer | Published December 5, 2023 | Posted in Criminal Defense | Tagged embezzlement, misapplication of fiduciary property, theft