People often assume that white collar crime isn’t really a crime. There usually aren’t weapons, violence or drugs involved, after all. If anything, it is seen as something more often than not that is a big mistake, that is a victimless crime, and that is punished lightly by the criminal justice system. If the victim is sent to prison at all, it is what is generally considered a “country club prison,” one that is barely really considered a prison at all.
That’s not the case. While all white-collar crimes are taken seriously by the authorities, one stands out amongst others: Embezzlement. The legal dictionary defines embezzlement as, “The fraudulent conversion of another’s property by a person who is in a position of trust, such as an agent or employee.”
And, because of the way embezzlement is portrayed in the media, the public’s perception is often skewed. The evening news generally only shows the most spectacular cases, with the most prominent members of the community. Fictional movies are even worse, in which embezzlement is generally presented as rich power brokers using technology or other means to steal millions of dollars, or a crooked CEO pilfering funds from shareholders. The reality is generally much more benign, features much less money and has a much lower profile.
We Can Help
If you’ve been accused of embezzlement in the state of Kentucky, you need legal representation as soon as possible. Kentucky Criminal Defense Attorneys (KYCDA) can help. KYCDA is a network of criminal defense attorneys located in nearly every county across the state, licensed to practice law in all Courts of the Commonwealth of Kentucky. KYCDA has taken criminal defense cases of all types and has the resources and experience to help. Contact us for a consultation today.
The Basics of Embezzlement
The Legal Dictionary describes the basics of what constitutes embezzlement. They suggest embezzlement occurs when an individual takes or uses a company’s or agency’s money without consent. Often times, the perpetrator may take small sums of money unnoticed, and to avoid detection may move funds to make the trail confusing. In some cases, the person responsible may provide fake receipts or use other methods to hide the loss. If the person has a thorough knowledge of the system, detection may be difficult, if not impossible, so the embezzlement has the potential to carry on for long periods of time until an anomaly is noticed.
Types of Embezzlement
Embezzlement can come in several different forms, and it is not always cash that is taken. While the basic form may stay the same, there are as many types of embezzlement as there are people willing to commit the crime. However, a few types are more common than others. The business Website bizmanuals.com lists some of the most common:
Cash embezzlement is one of the simplest types, and occurs in a variety of ways, including: stealing petty cash, keeping cash from a transaction instead of placing it in a register, stealing from property, short-changing and other techniques.
Embezzling Negotiable Documents Issued or Sold by the Company
Embezzling negotiable documents primarily involves: refund authorizations, unauthorized use of credit and debit memos to manipulate accounts, money orders, forgeries, travelers checks and manipulating the company’s official checks.
Account Credit Embezzlement
This the most common example of credit embezzlement, and involves the manipulation or creation of: inactive or dormant accounts, particularly senior citizen, foreign customer and conservator ship accounts; unauthorized transfers between general ledger accounts; “ghost” employees for payroll fraud; loans and lines of credit for fictitious borrowers; deposit accounts for fictitious persons or entities to receive stolen or forged checks; deposit accounts for check kiting.
This type of embezzlement involves the manipulation or employment of: customer account information to “skim” the account for re-sale, or other criminal use; “salami” or “trap door” techniques to take a small amount of money from each transaction processed, electronically transferring the amount to another account; “data diddling” schemes to alter the manner in which a computer program works, or to neutralize control mechanisms; “Trojan horse” programs, to insert extra commands into a computer program, causing the computer to perform authorized and unauthorized functions simultaneously; and “logic bomb” commands, or a set of instructions programmed to perform various functions at appropriate or periodic times. This technique is used to shift funds, erase data, or shut down the entire system at a given time.
Preventing and Detecting Embezzlement
The Balance, an online financial journal, has several suggestions for preventing and detecting embezzlement.
- Deposit daily and reconcile monthly.
- Separate financial duties of employees.
- Keep track of petty cash.
- MBWA (Manage by Walking Around).
- Check to make sure that travel expenses are supported by appropriate paperwork.
Detection, Signs of Trouble
- An employee who refuses to take vacation
- An employee who continually works overtime
- An employee who wants to take work home
- Excessive personal spending (new cars, trips)
- Petty cash disappearing too quickly
- Extravagant expenses for employee travel
- Employees who have close relationships with vendors
- Rapidly disappearing office supplies.
KRS 541 states both definitions and penalties for embezzlement. For the most part, embezzlement is considered a form of theft and the same penalties apply, based on the amount stolen. More than $500 constitutes a Class D felony. However, the charges and penalties may depend on other mitigating circumstances.
If you or a loved one has been accused of a crime in Kentucky, Dan Carman and Attorneys, PLLC can help. We have represented countless clients to ensure that they are treated fairly, providing an aggressive defense to achieve the best possible result. With attorneys in nearly every county in the state, we have the ability and the knowledge, to give you the best defense possible, no matter where you live. If you have questions or seek a consultation, contact us online or at 859-685-1055 as soon as possible.