Embezzlement, Theft, and Fraud: How Harris County Prosecutes
- July 19, 2017
- The Law Office of Greg Tsioros
- Comments Off on Embezzlement, Theft, and Fraud: How Harris County Prosecutes
What is Theft?
Texas Penal Code Chapter 31 describes theft. A common theft crime in Texas involves taking and removing property that belongs to someone else. The action of theft is performed with intention. The actor wants to “permanently deprive” the owner of his or her property. Theft crimes include “unlawful appropriation” of properties with the intention of depriving rightful property owners.
Texas prosecutors classify theft punishments by the value of stolen services or properties as well as the types of properties stolen. The prosecutor has the option to use the fair market value or replacement value of the property when considering the charge’s severity:
- If the property is valued at less than $100, this is a Class C misdemeanor that’s punishable with a $500 fine.
- If the property is valued at greater than $100 but less than $750, this is a Class B misdemeanor that’s punishable by a maximum 180-day jail term and/or a maximum $2,000 fine.
- Class A misdemeanor: If the property is worth more than $750 but less than $2,500, the crime is punishable by less than 12 months in jail and/or a maximum $4,000 fine.
- State Jail Felony: If the property is worth more than $2,500 but less than $30,000, the crime punishable by a minimum two-year to a maximum 10-year prison term and/or a maximum $10,000 fine.
- Third-Degree Felony: If the property is worth $30,000 but less than $150,000, the crime is punishable by a minimum two-year to a maximum 10-year prison sentence and/or a maximum $10,000 fine.
- Second-Degree Felony: If the property is valued at least $150,000 but less than $300,000, the crime is punishable with a minimum two-year to the maximum 20-year prison term and/or a maximum $10,000 fine.
- First-Degree Felony: If the property is worth more than $300,000, the crime is punishable by a minimum five-year to the maximum 99-year prison term and/or a maximum $10,000 fine.
Punishment enhancements for Theft in Texas apply. If the offender was previously convicted of theft, he or she is likely to face an upgraded charge. For instance, an individual with a prior theft conviction may see the Class C misdemeanor crime rise to a Class B misdemeanor because of his or her prior theft charges.
What is Fraud?
Fraud is an illegal action in which an individual cheats to acquire goods, property, or money. Fraud may be the act of one person or a group of persons. Fraud is performed for the gain of the individual or group.
An individual can cheat another person financially without disclosing the cheat to the owner. If the owner learns of the fraud, he or she has the option to go to court and file a lawsuit against the fraudster. When the court has sufficient evidence to prove that fraud occurred, the offender faces significant punishments in Texas.
What is Embezzlement?
Embezzlement involves taking assets that belong to another person and converting these assets to one’s personal use. It’s common for people in today’s world to entrust assets to another person, such as a bookkeeper, accountant, or financial manager, for business purposes. When the person to whom the assets have been entrusted uses or diverts the assets for personal use and obtains ownership of these assets by fraudulent means, this is embezzlement. For instance:
- An investment adviser may decide to embezzle money from his or her clients without their knowledge or approval.
- A teller at the bank transfers a customer’s funds to a personal account. The transaction is performed by the bank teller’s misrepresenting the bank approval process.
Embezzlement is accomplished through cheating or fraud. The commission of embezzlement might not happen quickly. The embezzler might plan the crime over months or years, and then performs the act of embezzlement in a systematic and methodical manner.
An individual or a group can be involved in acts of embezzlement. To conceal fraudulent acts, an offender might not embezzle from every investor or all accounts but would select them carefully over a period of time.
Like a theft crime, the amount of money allegedly embezzlement guides the punishment:
- If the defendant is accused of embezzling up to $50, he or she faces a maximum $500 fine.
- For $50 up to $499, he or she faces a maximum six-month jail term and a maximum $2,000 fine.
- For $500 up to $1,499, he or she faces up to 12 months in jail and a maximum $4,000 fine.
- For $1,500 up to $19,999, he or she faces a two-year prison term plus a maximum $10,000 fine.
- For $20,000 up to $99,999, he or she faces a maximum 10-year prison sentence plus a maximum $10,000 fine.
- For $100,000 to $199,999, he or she faces a maximum 20-year prison sentence plus a maximum $10,000 fine.
- For $200,000 or more, he or she faces a maximum 99-year prison term plus a maximum $10,000 fine.
Federal embezzlement charges may apply for individuals or groups charged with the conversion of large sums of money or assets belonging to others.
Possible Defenses to an Embezzlement Charge
If a small amount of money is involved, the defendant may argue that a mistake was made. In other words, if an accountant, bookkeeper, teller, etc., didn’t mean to alter the company’s records to conceal income and made an unintentional mathematical error, this may be a reasonable defense.
Another argument could focus on intention. If the actor didn’t intend to deprive the true owner of the goods, property, or money, this is another reasonable defense against an embezzlement charge. Let’s say that Lisa is a financial advisor. A friend wants to invest with Lisa’s company and writes a check to Lisa personally. Lisa doesn’t correct her. Instead, she deposits the check in her account and withdraws the exact amount to deposit into her friend’s account. She didn’t intend to convert her friend’s money for her personal gain. However, she shouldn’t have put the money into her personal account for any period of time.
Embezzlement vs. Fraud
Embezzlement and fraud are typically considered white-collar crimes. Both are specific types of theft. Quite often, embezzlement involves theft from a business or employer. The embezzler has access to the funds but doesn’t have the legal right to use them without permission from the owner. For example, stealing cash from an employer, improperly reporting company revenue to pocket the difference or direct money from a business bank account that doesn’t belong to the embezzler to his or her own account are examples of embezzlement.
Fraud is often difficult to discover. Unfortunately, embezzlement is often even more difficult to catch because the perpetrator has access to the money or assets and time to plan and execute the process of converting someone else’s property to their own. Fraud and embezzlement are closely related legal terms and some people believe they mean the same thing. In both instances, stealing and cheating occur:
- Fraud involves intentionally and illegally cheating someone.
- Embezzlement involves the act of dishonestly withholding someone else’s assets and claiming their ownership as one’s own at some later date. Embezzlement occurs through the commission of fraud.
Real Life Embezzler in the News
A 29-year-old woman in Houston was recently charged with embezzlement of about $275,000 at a local grocery store. She stole cash from the employer and concealed her theft practice through fraudulent accounting entries and practices.
The woman was employed by the grocery store for at least three years. She was entrusted with handling money from the “cash room” to disperse to the self-service checkout terminals in the store. Investigators believe the embezzlement started in March 2016 and continued for about a year. Failure to come to work because of an illness allowed others to suspect embezzlement.
Loss prevention employees found false deposits and fund transfers made by the employee. She employed a variety of fraud mechanisms to conceal the systematic theft. A video showed the woman pocketing or concealing money at work on a number of occasions. Bond was set at $500,000.
She is charged with a first-degree felony. If convicted, she faces a maximum 99 years in prison plus up to $10,000 in fines.
Differences in Embezzlement, Fraud, and Theft Crimes in Texas
As you can see, there’s a great deal of overlap between the definitions of these crimes. However, consider the potential intricacy involved in planning and executing the crime. Theft typically involves less planning. Fraud and embezzlement crimes may take a long time to plan and execute.
If you have been charged with theft, fraud, or embezzlement in Houston, Harris County, or anywhere in the state of Texas, you need a seasoned criminal defense attorney. Greg Tsioros, a former prosecutor with the Harris County District Attorney’s Office, can mean the difference in the outcome of your case. Contact The Law Office of Greg Tsioros to schedule an initial case evaluation now.