Is embezzlement a felony?

Embezzlement is taking or misusing money or property that someone trusted you to hold. California defines it as the fraudulent appropriation of property by a person to whom it has been entrusted.^1,2

Virginia's law covers a person who wrongfully and fraudulently uses, disposes of, conceals or embezzles money or other property received for another, for an employer, or because of an office, trust or job. The key difference from ordinary theft is that the person had lawful access to the property first.

Many states grade embezzlement the same way as theft, so the amount taken decides how serious the charge is. New York, Texas, Virginia and California all tie it to their theft laws.^2,3,4,5

New York lists embezzlement as a way to commit larceny. Texas folded embezzlement into its single theft offense. Virginia says a person convicted of embezzlement is guilty of larceny and punished under its larceny laws. California says embezzlement is punished the way theft of the same value or kind of property is punished.

Some states also have a separate offense for misusing money you hold for someone else. Texas calls it misapplication of fiduciary property, and Pennsylvania calls it theft by failure to make required disposition of funds.^6,7

In Texas, a fiduciary includes a trustee, guardian, executor, or a person acting under a power of attorney. The offense covers dealing with the property against the agreement or law that governs it, in a way that risks loss to the owner. Pennsylvania's version applies when a person agrees or is legally required to make specified payments from property received and instead treats it as his own.

Embezzling a small amount is a misdemeanor in states that grade it by value. In Texas, misapplying property worth less than $2,500 is a misdemeanor. In Virginia, embezzling less than $1,000 is punished as petit larceny, a Class 1 misdemeanor.^2,6,8

Texas splits the misdemeanors into Class C (under $100), Class B ($100 up to $750) and Class A ($750 up to $2,500). In California, embezzlement is punished like theft of the same value, and theft of $950 or less is generally a misdemeanor.

Embezzlement becomes a felony once the amount passes the state's theft line. That line is $1,000 in New York and Virginia, $2,000 in Pennsylvania and $2,500 in Texas. California ties it to its $950 grand theft line.^6,9,10,11,12

New York's lowest grand larceny grade applies above $1,000. Virginia's grand larceny applies at $1,000 or more. Pennsylvania's third-degree felony applies when the amount exceeds $2,000. Texas's state jail felony starts at $2,500.

Some states make embezzlement a felony at any amount when the person held a position of trust. North Carolina does this for public officials, fiduciaries, corporate officers and agents, clerks and employees.¹³

North Carolina's statute applies to people exercising a public trust, holding public office, serving as guardian, trustee or other fiduciary, or acting as an officer, agent, clerk or servant. The text does not set a minimum dollar amount.

Who the victim is can also raise the grade. In California, embezzling public funds is a felony. In Texas, misapplying property of an elderly person moves the offense up to the next higher category.^4,5,6

California's section covers funds of the United States, the state, or a county or city, and calls the offense a felony punishable by imprisonment in state prison. Texas also raises the grade of theft by a public servant who holds property because of that job.

Large amounts bring higher felony grades. In New York, over $3,000 is a class D felony and over $50,000 is a class C felony. In Texas, misapplying $300,000 or more is a first-degree felony.^6,14,15

Texas

Texas: misapplying fiduciary property worth under $2,500 is a Class C, B or A misdemeanor, depending on value. At $2,500 or more it is a state jail felony.⁶

The grades continue as a third-degree felony for $30,000 up to $150,000, a second-degree felony for $150,000 up to $300,000, and a first-degree felony for $300,000 or more. Texas also folds other embezzlement into its theft offense, graded under section 31.03.

California

California: embezzlement is punished the way theft of the same value is. At $950 or less that generally means a misdemeanor, and over $950 it can be a misdemeanor or a felony. Embezzling public funds is a felony.^1,5,12,16

California's section 514 sends embezzlement to the theft penalties. Grand theft is punishable by up to one year in county jail or by a felony jail sentence. When an employee or agent takes from an employer, amounts that add up to $950 or more within 12 consecutive months are grand theft.

New York

New York: embezzlement is larceny. Taking property worth over $1,000 is grand larceny in the fourth degree, a class E felony. Smaller amounts are petit larceny, a class A misdemeanor.^3,9,17

Over $3,000 is a class D felony, and over $50,000 is a class C felony.

Pennsylvania

Pennsylvania: theft by failure to make required disposition of funds is graded as theft. Over $2,000 is a third-degree felony. Otherwise it is a misdemeanor, and breach of a fiduciary obligation keeps it at least a first-degree misdemeanor.^7,11

The state's lower misdemeanor grades, for amounts under $200, apply only if the property was not taken in breach of a fiduciary obligation. The statute presumes that a government or financial-institution employee who fails to account on lawful demand, or whose audit shows a shortage, dealt with the property as his own.

Virginia

Virginia: embezzlement is punished as larceny. Under $1,000 it is petit larceny, a Class 1 misdemeanor. At $1,000 or more it is grand larceny, a felony.^2,8,10,18

Grand larceny is punishable by a state prison term, which is how Virginia law defines a felony, though the court or jury may instead order up to 12 months in jail.

North Carolina

North Carolina: embezzlement by a public official, fiduciary, agent, clerk or employee is a felony at any amount. It is a Class H felony under $100,000 and a Class C felony at $100,000 or more.¹³

Federal

Embezzling money or property of the U.S. government is a federal crime. The maximum is 10 years in prison, or one year if the value is $1,000 or less.¹⁹

The law covers embezzling, stealing or knowingly converting any record, voucher, money or thing of value of the United States or one of its agencies. It also covers receiving or hiding such property knowing it was embezzled. Amounts from all counts in one case are added together when deciding whether the $1,000 line is met.

Federal

Federal law separately punishes bank officers, directors, agents and employees who embezzle or willfully misapply a bank's money. The maximum is 30 years in prison and a $1,000,000 fine, or one year if the amount is $1,000 or less.²⁰

Under 12 U.S.C. § 1829, a person convicted of a crime involving dishonesty, breach of trust or money laundering may not work at, own or control, or otherwise take part in the affairs of an FDIC-insured bank without the FDIC's prior written consent. The same applies to a person who agreed to a pretrial diversion or similar program for such a charge.^21,22

FDIC rules define a crime of dishonesty as one where a person cheats or defrauds, or wrongfully takes property belonging to another. Breach of trust covers misusing property held in a fiduciary or official role. Embezzlement fits those definitions, and bank embezzlement under 18 U.S.C. 656 is named in the statute. The FDIC decides from the offense's statutory elements or court rulings on them, so not every conviction for this crime is covered. The rules also leave out a misdemeanor committed more than one year before the person files a consent application, not counting time spent incarcerated.

The bank ban in 12 U.S.C. § 1829 does not apply once 7 years have passed since the offense, or 5 years since release if the person was incarcerated for it. For an offense committed at age 21 or younger, it stops applying once more than 30 months have passed since sentencing.²¹

It also does not apply to a conviction covered by an expungement, sealing or dismissal order meant to remove it from the person's record, or to minor offenses the FDIC sets by rule. The time limits do not apply to certain listed federal offenses, including bank embezzlement (18 U.S.C. 656), bank fraud and mail or wire fraud that affects a financial institution. For those, the FDIC may not consent for 10 years after the conviction becomes final, though the sentencing court may grant an exception on the FDIC's motion.

In California, a person convicted of embezzling public funds is ineligible afterward for any office of honor, trust or profit in the state.⁵