Embezzlement

== Versus larceny ==

Embezzlement is not always a form of [[theft]] or an act of stealing, since those definitions specifically deal with taking something that does not belong to the perpetrators. Instead, embezzlement is, more generically, an act of deceitfully secreting assets by one or more persons that have been ''entrusted'' with such assets. The persons entrusted with such assets may or may not have an ownership stake in such assets.

Embezzlement differs from [[larceny]] in three ways. First, in embezzlement, an actual ''[[conversion (law)|conversion]]'' must occur; second, the original taking must not be [[trespass]]ory,<ref>Singer & LaFond, ''Criminal Law'' (Aspen 1997), p. 213.</ref> and third, in penalties. To say that the taking was not trespassory is to say that the persons performing the embezzlement had the right to possess, use or access the assets in question, and that such persons subsequently secreted and converted the assets for an unintended or unsanctioned use. ''Conversion'' requires that the secretion interfere with the [[property]], rather than just relocate it. As in larceny, the measure is not the gain to the embezzler, but the loss to the asset stakeholders. An example of ''conversion'' is when a person logs checks in a [[check register]] or transaction log as being used for one specific purpose and then explicitly uses the [[funds]] from the checking account for another and completely different purpose.<ref name=":0">{{Cite web|date=2015-02-19|title=1005. Embezzlement|url=https://www.justice.gov/archives/jm/criminal-resource-manual-1005-embezzlement|access-date=2021-08-31|location=United States|publisher=Department of Justice|language=en}}</ref>

When embezzlement occurs as a form of theft, distinguishing between embezzlement and larceny can be tricky.<ref>In their book ''Criminal Law'', Singer and LaFond provide an excellent analytical method for making these distinctions. Singer & LaFond, ''Criminal Law'' (Aspen 1997), p. 221.</ref> Making the distinction is particularly difficult when dealing with [[misappropriation]]s of property by employees. To prove embezzlement, the state must show that the employee had possession of the goods "by virtue of his or her employment"; that is, that the employee had formally delegated authority to exercise substantial control over the goods. Typically, in determining whether the employee had sufficient control the courts will look at factors such as the job title, job description and the particular operational practices of the firm or organization. For example, the manager of a shoe department at a [[department store]] would likely have sufficient control over the store's inventory (as head of the shoe department) of shoes; that if they converted the goods to their own use they would be guilty of embezzlement. On the other hand, if the same employee were to steal cosmetics from the cosmetics department of the store, the crime would not be embezzlement but larceny. For a case that exemplifies the difficulty of distinguishing larceny and embezzlement see ''State v. Weaver'', 359 N.C. 246; 607 S.E.2d 599 (2005).<ref name=":0" />

North Carolina appellate courts have compounded this confusion by misinterpreting a statute based on an act passed by parliament in 1528. The [[courts of North Carolina|North Carolina courts]] interpreted this statute as creating an offence called "larceny by employee"; an offence that was separate and distinct from common law larceny.<ref>N.C. Gen. Stat. § 14–74 provides in part: "If any servant or other employee, to whom any money, goods or other chattels, ... by his master shall be delivered safely to be kept to the use of his master, shall withdraw himself from his master and go away with such money, goods or other chattels, ... with intent to steal the same and defraud his master thereof, contrary to the trust and confidence in him reposed by his said master; or if any servant, being in the service of his master, without the assent of his master, shall embezzle such money, goods or other chattels, ... or otherwise convert the same to his own use, with like purpose to steal them, or to defraud his master thereof, the servant so offending shall be guilty of a felony&nbsp;..."</ref><ref>For cases interpreting the statute, see ''State v. Canipe'', 64 N.C. App. 102, 103, 306 S.E.2d 548, 549 (1983); State v. Brown, 56 N.C. App. 228, 229, 287 S.E.2d 421, 423 (1982).</ref> However, as Perkins notes, the purpose of the statute was not to create a new offence but was merely to confirm that the acts described in the statute met the elements of common law larceny.<ref>Perkins, ''Criminal Law'' (2nd ed.) (1986), p. 286.</ref>

The statute served the purpose of the then North Carolina colony as an [[indentured servitude|indentured servant]] and slave-based [[political economy]]. It ensured that an indentured servant (or anyone bound to service of labour to a master, e.g., a slave) would owe to their master their labour; and, if they left their indentured service or bound labour unlawfully, the labour they produced, either for themselves (i.e., self-employed), or for anyone else, would be the converted goods that they unlawfully took, from the rightful owner, their master.{{Citation needed|date=September 2021}}

Crucially (and this can be seen as the purpose of the statute), any subsequent employer of such an indentured servant or slave, who was in fact bound to service of labour to a pre-existing master, would be chargeable with [[misprision of felony|misprision of a felony]] (if it was proved they knew that the employee was still indentured to a master, or owned as a slave); and chargeable as an accessory after the fact, in the felony, with the servant or slave; in helping them, by employing them, in unlawfully taking that which was lawfully bound (through the master–servant relationship) in exclusive right, to the master of the indentured servant or slave.