According to the Federal Bureau of Investigation’s Crime Data Explorer, U.S. law enforcement agencies recorded 11,316 embezzlement arrests in 2022, showing how common trust-related financial crimes remain across industries and organizations.
Embezzlement often sounds like something that happens only in corporate boardrooms, but that’s far from true. These cases involve employees, bookkeepers, cashiers, treasurers, nonprofit workers, government staff, and people from dozens of other positions who gain access to money—or property—and misuse it for personal gain.
What Is Embezzlement?
Embezzlement is a property theft crime that occurs when a person:
- Is trusted with money, property, or assets
- Uses it for personal benefit
- Without permission from the rightful owner
In simple terms: it’s stealing something you were allowed to hold, but not allowed to take.
Key Components are
- Someone had lawful access, not ownership.
- They intentionally used the property for themselves.
- The owner didn’t allow the use.
- There was intent to permanently or temporarily deprive the owner.
Embezzlement Examples
There are 7 common examples seen across U.S. courts:
1. Employee Cash Theft
A cashier pockets $80 per shift from the register.
2. Payroll Embezzlement
A payroll manager creates a “ghost employee” and deposits paychecks into their own account.
3. Nonprofit Treasurer Theft
A nonprofit treasurer transfers $12,000 of donations into a personal account.
4. Corporate Funds Misuse
A company executive charges $40,000 in personal vacations to the corporate card.
5. Bank Employee Theft
A bank teller skims $200 per week from customer deposits.
6. Investment Advisor Misappropriation
A financial advisor diverts client funds into personal accounts.
7. Guardian or Trustee Fraud
A legal guardian uses a protected adult’s money to buy personal items.
Federal vs. State Embezzlement Laws
Embezzlement can be charged under state law or federal law, depending on what was stolen and who owned it.
Federal Embezzlement Laws
A case becomes federal when:
- The stolen money belonged to the U.S. government
- The crime involved a federal agency, such as USPS or IRS
- The case involved a bank insured by the FDIC
- The theft crossed state lines
- An interstate wire transfer was used
Main Federal Statutes
Federal embezzlement crimes are found under 18 U.S.C. §§ 641–669.
Some examples include:
- § 641 – Theft of Government Property
- § 656 – Bank Embezzlement
- § 657 – Embezzlement from Credit Unions or Loan Associations
- § 666 – Theft from Organizations Receiving Federal Funds
Federal Penalties
Federal penalties can include:
- Up to 10–30 years in prison for bank embezzlement
- Up to 10 years for federal property theft
- Fines reaching $250,000 or more
- Mandatory restitution
State Embezzlement Laws
States classify embezzlement based on:
- Value stolen
- Type of property
- Victim (employer, senior citizen, bank, nonprofit, etc.)
Each state has its own statutes. For example:
- California: Penal Code § 503–515
- Texas: Penal Code § 31.02–31.04
- Florida: Statute § 812.014
- New York: Penal Law § 155.05
Typical State Penalties
Most states use value-based thresholds. For example:
- Under $500–$1,000 → Misdemeanor
- Over $1,000–$5,000 → Low-level felony
- Over $50,000 → High-level felony
- Over $100,000 → Major felony
Penalties often include are Jail or prison, fines, restitution, probation and permanent criminal record.
Learn More: Common Types of Healthcare Fraud
Punishments & Sentencing Ranges
Punishment depends on:
- Amount stolen
- Duration of the scheme
- Trust position of the defendant
- Whether the victim was vulnerable
- Prior criminal history
Typical Sentencing Ranges by Amount
| Value Stolen | Typical Charge | Possible Penalty |
|---|---|---|
| $500–$1,000 | Misdemeanor | Up to 1 year jail |
| $1,000–$5,000 | Felony | Up to 3 years prison |
| $5,000–$50,000 | Felony | Up to 5 years prison |
| $50,000–$100,000 | Felony | 5–10 years prison |
| $100,000+ | High Felony | Up to 20 years prison |
| Federal bank/government embezzlement | Federal Felony | Up to 30 years |
Other penalties include:
- Fines (from $1,000 to $250,000+ depending on the case)
- Probation
- Loss of professional licenses
- Paying restitution
- Employment restrictions
Misdemeanor vs. Felony Embezzlement
Misdemeanor Embezzlement
Occurs when:
- Low dollar amounts are involved (usually under $1,000)
- No vulnerable victims
- First-time offender
Penalties may include:
- Up to 1 year in county jail
- Fines
- Probation
Felony Embezzlement
Occurs when:
- Larger amounts were stolen
- The scheme lasted long
- A position of trust was abused
- A bank or government agency was involved
Penalties include:
- 1–20+ years in prison
- Heavy fines
- Mandatory restitution
- Criminal record
What are the Types of Embezzlement?
There are 10 major types, each involving different victims and methods:
1. Employee Embezzlement
Misusing employer funds or assets.
2. Bank Embezzlement
Tellers, loan officers, or managers taking bank money.
3. Corporate Embezzlement
Executives or accountants manipulating financial records.
4. Payroll Embezzlement
Ghost employees, false hours, or inflated pay.
5. Nonprofit Embezzlement
Misuse of donations or grant funds.
6. Government Embezzlement
Theft of public funds or property.
7. Trustee/Guardian Embezzlement
Taking money from protected persons.
8. Vendor/Supplier Fraud
Vendors stealing from companies through fake invoices.
9. Healthcare Embezzlement
Misuse of patient payments or insurance reimbursements.
10. Retail Register/Point-of-Sale Embezzlement
Skimming, refund fraud, or void schemes.
What are the Elements Prosecutors Must Prove?
Prosecutors must prove four elements for a conviction:
1. A fiduciary or trust relationship existed
The defendant legally held money or property.
2. The defendant acquired the property through that relationship
They didn’t steal it outright—they misused access.
3. The defendant intentionally took or misused the property
Accidents don’t count as embezzlement.
4. The defendant intended to permanently or temporarily deprive the owner
Intent is critical.
Which type pf Defenses Attorneys Commonly Use?
Defense attorneys challenge these elements by arguing:
1. Lack of Intent
The accused believed they had permission or made a bookkeeping mistake.
2. Owner Consent
The employer or owner allowed the expense or transaction.
3. Mistaken Identity
Another employee or person conducted the fraudulent act.
4. Insufficient Evidence
Missing documents, unclear records, or lack of direct proof.
5. Duress
The defendant acted because of threats or coercion.
6. Lack of Trusted Relationship
If no fiduciary duty existed, the charge may not apply.
7. Returned Property
While not a full defense, repayment can reduce penalties.
Final Thought
Embezzlement may look like a “paper crime,” but its impact can hit businesses, nonprofits, and individuals with real financial and emotional damage. Understanding the definition, laws, punishments, and common defenses gives anyone—from employees to business owners—a clearer sense of how seriously the justice system treats these cases. Staying informed helps prevent mistakes, protect organizations, and navigate situations where trust and money intersect.
FAQs
Is embezzlement the same as theft?
No. Embezzlement involves permission to access, not permission to take. Theft does not require a trust element.
Can embezzlement be accidental?
Not legally. Prosecutors must prove intent, so true mistakes are not embezzlement.
Is paying money back enough to avoid charges?
No. Repayment may reduce sentencing but does not erase the crime.
How long does someone go to jail for embezzlement?
Sentences range from 1 year in jail for misdemeanors to 30 years in federal prison for bank or federal embezzlement.
Can embezzlement charges be dropped?
Yes, if there is insufficient evidence or if a defense proves no intent.
What dollar amount makes embezzlement a felony?
Usually $1,000–$2,500, depending on the state.
Do first-time offenders go to jail?
They can, but many receive probation if the amount stolen is small.
What is Embezzlement Definition?
Embezzlement is a property theft crime that occurs when a person: Is trusted with money, property, or assets and Uses it for personal benefit, without permission from the rightful owner. Its mean tealing something you were allowed to hold, but not allowed to take.
