Embezzlement vs. Larceny by Employee

linkedin
Share on Google+
Share on Reddit
Share on Tumblr

I’ve been asked several times recently whether a particular set of facts should be charged as embezzlement, in violation of G.S. 14-90, or as larceny by employee, in violation of G.S. 14-74. Struggling to answer those questions led me to realize that I didn’t have a good understanding of the relationship between the two offenses. I did some research, and thought I’d share it on the theory that others might be as confused as I was.

First, the basics. The embezzlement statute generally makes it illegal for several categories of people, including “any agent, consignee, clerk, bailee, or servant . . . of any person” to “[e]mbezzle,” “misapply,” or “convert,” another’s “money, goods, or other chattels.” It’s a class H felony, unless the value of the property in question is $100,000 or more, in which case, it’s a class C felony.

The larceny by employee statute generally makes it illegal for “any servant or other employee, to whom any money, goods, or other chattels” have been given by his “master,” to “go away with” the property with the intent to steal it, or to “embezzle” or “convert” them. Just like embezzlement, it’s a class H felony, unless the value of the property in question is $100,000 or more, in which case, it’s a class C felony.

With that in mind, here are a few notes about the relationship between the two:

  1. The offenses are very similar. As Jessie Smith noted in the current version of North Carolina Crimes, larceny by employee is “similar to embezzlement.” The essence of both crimes is the misappropriation of property that was entrusted to the perpetrator. As our supreme court has explained, the crime of embezzlement exists “to punish the misappropriation of property rightfully in the possession of the alleged wrongdoer, who . . . could not be convicted of larceny, because there was no taking from the owner’s possession by an act of trespass.” State v. McDonald, 133 N.C. 680 (1903). The crime of larceny by employee serves a similar purpose. Indeed, although no appellate decision directly compares the two crimes, the court of appeals has referred to them in a way that suggests that they are often indistinguishable. State v. Hinton, 155 N.C. App. 561 (2002) (describing the defendant’s testimony that he did not rob a cashier at knifepoint, but rather collaborated with the cashier to stage a bogus armed robbery, as admitting guilt to “aiding and abetting embezzlement or larceny by employee”). In the run of the mill case in which an employee misappropriates his employer’s property, either offense fits.
  2. There is no de facto standard. Although one offense or the other might be the default charge for run of the mill cases in a particular jurisdiction, statewide, the two offenses are charged about equally often. According to data from the Administrative Office of the Courts, in a recent year, Class H embezzlement was charged 4402 times, while Class C embezzlement was charged 68 times. Class H larceny by employee was charged 4259 times, while Class C larceny by employee was charged 8 times.
  3. Embezzlement extends beyond employees. The most significant difference between the two offenses is that while larceny by employee is limited to “servant[s] or other employee[s],” embezzlement may also be committed by those who hold public office; fiduciaries, such as executors and trustees; bailees; and others who are entrusted with property. See generally State v. Weaver, 359 N.C. 246 (2005) (“Minor substantive revisions to the [embezzlement] statute have been made over the last 130 years, most notably those expanding the class of individuals who are capable of committing the offense of embezzlement.”). So for certain fact patterns, embezzlement is the only option.
  4. Prosecutors can aggregate multiple takings in embezzlement cases. Case law establishes that a prosecutor may charge several related takings in separate counts of embezzlement, or aggregated together into a single count. State v. Mullaney, 129 N.C. App. 506 (1998) (Greene, J., concurring in the result, joined by Timmons-Goodson, J.) (holding that “each act of embezzlement can support a separate indictment” but that “a single embezzlement indictment [may also encompass] multiple misapplications and conversions” that are part of a series of related acts, with “[t]he choice of how to proceed [belonging to] the district attorney”). If there’s a case that extends that principle to larceny by employee, I’m not aware of it. So if controlling the aggregation of related takings is important, embezzlement is a superior choice.

The foregoing certainly doesn’t answer every possible question related to embezzlement and larceny by employee. For example, can a defendant be charged with, convicted of, and punished for both crimes based on the same conduct? Although technically there may be no double jeopardy problem under the Blockburger test, I tend to think not, because the crimes are so similar. But I’m not aware of a case on point. If there are other issues that come up regarding these two offenses, please let me know or post a comment.

10 comments on “Embezzlement vs. Larceny by Employee

  1. Thanks for the post. It may be worthwhile to note that it is fairly common for warrants alleging Larceny by Employee to be issued in situations which don’t resemble embezzlement. I am speaking of situations in which there is no allegation that the goods were entrusted to the employee or received rightfully by the employee before being dishonestly taken. Warrants for this felony often issue merely because the soon-to-be Defendant was an employee of the victimized business. Another way to put this is that it appears that the name of the charge is misunderstood to fully describe the charge.

    Along the same lines, I am starting to see warrants alleging that a larceny is a felonious larceny because it occurred in conjunction with a Breaking or Entering of a Motor Vehicle, i.e. finding that a larceny was felonious as if it were contemporaneous with a Breaking or Entering of a building. My suspicion is that the (new?) wording on the form warrants merely states (approximately) “pursuant to a Breaking or Entering”, thus implying that a B or E of a Motor Vehicle would be included, are the origin of this.

    • What I’ve read so far has been very helpful; however, I’m still a little confused. Did the store manager of a convenience store commit Felonious Larceny or Larceny by Employee when he showed up on his off day and sai to the assitant manager, “Hey, if you have the deposit ready I’ll drop it at the bank for you.” Takes the bank bag and never returns?

  2. The matter is confusing for judges also-I got non-suited in a case where Larceny by Employee was charged and the judge thought it should have been embezzlement.
    This is another area that the legislature should clear up along with that morass of case law that governs armed robbery (presumptions, unloaded or non-functioning firearm, etc.). That would actually be an effective use of their time, as opposed to debating the merits of funding the “Tea Pot Museum.”

  3. The North Carolina courts interpreted a statute passed by Parliament in the sixteenth century as creating an offense called “larceny by employee”; an offense that was separate and distinct from common law larceny.[8][9] However, as Perkins notes, the purpose of the statute was not to create a new offense but was merely to confirm that the acts described in the statute met the elements of common law larceny.[10]

  4. I apologize for using the reply section. The distinction to be drawn is between embezzlement and common law larceny – not embezzlement and the misconstrued “offense” of larceny by employee.

  5. I am 39 years old i have larceny by employee. I HAVE NEVER BEEN IN ANY TROUBLE IN MY WHOLE LIFE. NOT EVEN A SPEEDING TICKET. DO I NEED A LAWYER. AND WHAT SHOULD I DO

    • First, stop stealing. Second, if you’re guilty I’d say just represent yourself. Tell the ADA that you are pleading guilty and hope for a plea deal. If you’re a first time offender a decent ADA will almost always consider a plea deal for a misdemeanor versus the felonious Larceny by Employee. Hiring a lawyer will give you more leverage but it’s not worth the money to me. You basically will be asking the ADA for the same thing, a plea deal. Just my two cents.

      • The State is interested in prosecuting you in general, not giving you the best deal possible in general. Such being the case, and considering the seriousness of and type of charge, I believe you are better served by an attorney who knows the law, knows the court system, and likely will know the ADAs with whom your matter would be negotiated. I’ve seen and heard of many a client who’s negotiated a matter themselves with the State hoping for a good deal/the best deal, yet come out with just a “plea deal.” Not the best deal in light of their particular situation but “a deal.” The State doesn’t have the right to advise you of the legal implications of your plea, or to provide you with legal advice generally. An attorney does. It’s your life and your case and considering how negatively a felony like this can impact your life, it harms you nothing to at least consult with an attorney about your matter. There are many private attorneys who will consult with you for free, and there is always the right to apply for court appointed counsel if you cannot afford private counsel. Best wishes.

  6. I just wanted to know if a person is been charged with 13 counts of felony embezzlement in nc 14-90. How much time is this person looking to possible serve? And if they also are facing 13 counts of misdemenor larceny 14-72A in nc as well.

  7. Please help me !! My mom and sister have a business which is a nonprofit benevolent order. My mom owns the majority of “shares” and is president..All on paperwork filed with state of nc.the business was set up under son as tax id. My mom left and moved to Florida entrusting the running of the business with a verbal agreement of salary alloted for her and my sister monthly. My sister began to withhold funds from my mother and then opened a separate acct under her son and all funds go into that. She told my mother she was trespassing at the office of business and that the business was no longer hers when she came back instate to see what was going on. What can we do? Cannot afford a lawyer..went to one who wanted a $3000 retainer . At what’s end and cannot believe someone can just steal your business. Went to police station and someone told us it was civil only and need a lawyer. Makes no sense !!! Thanks for any input or help!! Melissa

Leave a Reply

Your email address will not be published. Required fields are marked *


five − 1 =

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>