Consequences of Embezzlement
When someone misappropriates or steals anything they were expected to protect or manage, it’s called embezzlement. A significant value of the asset is not necessary for embezzlement to occur. Embezzlement can occur in the following ways:
1. Distinction from Fraud: Despite being closely connected, embezzlement is distinct from fraud in that the perpetrator was granted permission to handle or utilize the assets or money.
2. Connection to Other Fraud Schemes: Certain kinds of embezzlement may be coupled with other fraud schemes, such as Ponzi scams. In some instances, the embezzler connives to fool investors into believing that they may invest their assets on their behalf, but in reality, the embezzler takes the funds for enrichment and personal gain. Seeking out new investors to put in additional money to satisfy previous investors is a common step in maintaining the deception.
3. Types of Assets Embezzled: In addition to money, an embezzler may also transfer other assets. Real estate, business cars, cellphones, and other gear, such as computers, that belongs to an organization can all be claimed by an embezzler for personal use.
4. Government Embezzlement: If government workers take municipal, state, or federal funds for themselves, it might also be considered embezzlement. Such situations might arise when funds are distributed to carry out projects or fulfill contracts, and a staff member embezzles some of the designated funds.
5. Consequences: Individuals who embezzle may face criminal charges or civil penalties for their transgressions. Penalties might vary from jail time to monetary damages and victim compensation.