How does Texas charge embezzlement?
Texas has no offense named embezzlement. Taking money you were trusted to handle at work is charged as theft under Penal Code §31.03, and sometimes as misapplication of fiduciary property under §32.45. Value sets the grade, from a Class C misdemeanor under $100 to a first degree felony at $300,000 or more, and amounts taken in one scheme can be added together.
- Section 31.02 folded embezzlement into the single offense of theft.
- The state must show unlawful appropriation with intent to deprive the owner (§31.03(a)).
- Value decides the grade, and §31.09 lets the state add up amounts from one scheme.
- Section 31.03(f) raises the grade one level in listed cases, such as a public servant or an elderly or nonprofit owner. Private employment is not listed.
- Felony theft generally must be charged within five years, but theft by a trustee or executor carries ten (art. 12.01).
An accusation at work usually starts quietly: an audit, a frozen login, a meeting you did not expect. This guide explains what Texas charges and what follows. Peter M. Barrett has been licensed in Texas since 1994 and has tried more than 150 jury trials. He is a Past President of the Dallas Criminal Defense Lawyers Association (2005). See our Dallas white collar crime defense page.
Texas charges embezzlement as theft
Penal Code §31.02 says theft, as defined in §31.03, "constitutes a single offense superseding the separate offenses previously known as" a list that includes embezzlement. So the paper in your case will most likely say theft.
Under §31.03(a), a person commits theft if he unlawfully appropriates property with intent to deprive the owner of property. "Appropriate" means to acquire or exercise control over property, or to bring about a transfer of title (§31.01(4)). "Deprive" means to withhold property permanently, or long enough that a major portion of its value is lost, or to dispose of it so that recovery is unlikely (§31.01(2)).
Appropriation is unlawful if it is without the owner's effective consent (§31.03(b)(1)). Consent is not effective if induced by deception or coercion, or if given by a person the actor knew was not authorized to act for the owner (§31.01(3)). These charges usually involve access the person already had:
- Money moved from a company or client account to a personal one.
- Payroll or vendor entries for people or companies that do not exist.
- Cash or inventory taken by the person whose job was to count it.
Our guide on how prosecutors prove embezzlement covers the proof side.
The other charge: misapplication of fiduciary property
Some cases are filed under §32.45 instead. The offense is intentionally, knowingly, or recklessly misapplying property held as a fiduciary, or property of a financial institution, in a way that involves substantial risk of loss to the owner or to a person for whose benefit it is held (§32.45(b)). It reaches reckless conduct, and the owner need not actually lose the money.
"Fiduciary" includes a trustee, guardian, administrator, executor, an agent under a durable power of attorney, and an employee or agent carrying on fiduciary functions for a fiduciary (§32.45(a)(1)). "Misapply" means dealing with property contrary to the agreement under which it is held, or contrary to a law prescribing its custody (§32.45(a)(2)).
How the grade is set
Value drives everything. Under §31.08(a), it is the fair market value at the time and place of the offense, or, if that cannot be ascertained, the cost of replacing the property within a reasonable time.
The grades in §31.03(e) and §32.45(c) use the same ranges: under $2,500 is a misdemeanor, $2,500 or more is a felony, $300,000 or more is a first degree felony. Our guide on embezzlement versus money laundering has the full value table with each punishment range.
Small amounts can be added together
This rule turns small transfers into a felony. §31.09 reads in full:
"When amounts are obtained in violation of this chapter pursuant to one scheme or continuing course of conduct, whether from the same or several sources, the conduct may be considered as one offense and the amounts aggregated in determining the grade of the offense."
Thirty transfers of $200 are not thirty misdemeanors if the state ties them to one scheme. Added up, $6,000 is a state jail felony. Whether each transaction belongs in the total can be contested.
When the grade goes up a level
Under §31.03(f), a theft graded under (e)(1) to (e)(6) is increased to the next higher category if it is shown on the trial of the offense that:
- the actor was a public servant and the property came into his control by virtue of that status;
- the actor was in a contractual relationship with government and got the property through it;
- the owner was an elderly individual or a nonprofit organization;
- the actor was a Medicare provider under federal contract and got the property through it; or
- during the offense the actor set off or defeated a fire exit alarm, or defeated a retail theft detector.
Private employment is not on that list, so being trusted with the money does not by itself raise the grade. For misapplication, the one listed increase is an offense against an elderly individual (§32.45(d)).
Restitution
Under art. 42.037(a), in addition to any fine authorized by law, the court that sentences a defendant convicted of an offense may order restitution to any victim. If it does not, or orders only part, it must state the reasons on the record. Where property was lost or destroyed, the court may order it returned, or order payment of the greater of its value on the date of the loss or on the date of sentencing (art. 42.037(b)(1)).
- If the amount is disputed, the standard is a preponderance of the evidence, and the burden of showing the loss is on the prosecuting attorney (art. 42.037(k)).
- If the defendant is placed on community supervision, the court shall order the payment of restitution ordered under the article as a condition of supervision, and may revoke for failure to comply (art. 42.037(h)).
Repaying before charges are filed is not listed in §31.03 as a defense, and it creates a written record about the amount. Do not sign a repayment agreement before a lawyer reads it.
Time limits for filing the charge
Deadlines are set by offense type in art. 12.01 and art. 12.02.
| Charge | Deadline | Text of the subdivision |
|---|---|---|
| Felony theft, general rule | Five years from the date of the offense | art. 12.01(4)(A): "theft or robbery" |
| Theft by a trustee, executor, administrator, or guardian | Ten years from the date of the offense | art. 12.01(2)(A): "theft of any estate, real, personal or mixed, by an executor, administrator, guardian or trustee, with intent to defraud any creditor, heir, legatee, ward, distributee, beneficiary or settlor of a trust interested in such estate" |
| Theft by a public servant of government property | Ten years from the date of the offense | art. 12.01(2)(B): "theft by a public servant of government property over which the public servant exercises control in the public servant's official capacity" |
| Misapplication of fiduciary property, §32.45 | Seven years from the date of the offense | art. 12.01(3)(A): "an offense under Chapter 32, Penal Code, except as provided by Subdivision (2)(C) or (J)" |
| Class A or Class B misdemeanor theft | Two years from the date of the offense | art. 12.02(a)(1): "an indictment or information for any Class A or Class B misdemeanor" |
Two things stop the clock: time while the accused is absent from the state, and time while a charge is pending (art. 12.05). Because aggregation treats a series as one offense, the dates in the charging paper deserve review.
What a first accusation usually involves
No two cases follow the same path. The statutes set out these steps:
- The charging instrument. No person shall be held to answer for a felony unless on indictment of a grand jury (art. 1.05). A Class A or B misdemeanor may proceed on an indictment or an information (art. 12.02(a)(1)).
- Deferred adjudication. After a plea of guilty or nolo contendere, and a finding that the evidence substantiates guilt, a judge may defer further proceedings without adjudicating guilt and order deferred adjudication community supervision (art. 42A.101(a)). Theft and misapplication are not excluded by art. 42A.102(b).
- Community supervision. After a conviction or a plea, a judge may suspend the imposition of sentence and place the defendant on community supervision (art. 42A.053(a)). Any restitution ordered becomes a condition of that supervision (art. 42.037(h)).
Which is realistic depends on the facts, the grade, and the record. No lawyer can promise an outcome.
What a defense looks like
- Authority and intent. Theft requires appropriation without the owner's effective consent (§31.03(b)(1)) and intent to deprive as §31.01(2) defines it. Approvals, expense policies, and pay agreements go to both. A bookkeeping error is neither.
- Value and scope. Value sets the grade under §31.08, and aggregation under §31.09 needs one scheme. Transactions that do not belong should come out.
- Enhancements. Each item in §31.03(f) must be shown on the trial of the offense.
- Limitations and the restitution figure. Older conduct may fall outside art. 12.01 or 12.02, and the amount is contested under art. 42.037(k).
What to do if you are accused
- Do not give a statement to auditors, investigators, or police. Read about your right to remain silent.
- Do not sign anything. Confessions, resignation letters, and repayment agreements become evidence.
- Preserve your records, and do not contact the accusers. Deleting anything creates a new problem.
- Call early. The window before a charge is filed is when the most can be done. Our office is at (214) 526-0555.
Related: who gets charged with embezzlement, white collar crime, business fraud accusations, community supervision.
Common questions
Is embezzlement a crime in Texas?
Not under that name. Section 31.02 says theft under section 31.03 is a single offense that superseded the older offenses, and embezzlement is on that list. Some cases are charged under section 32.45.
Is embezzlement a felony in Texas?
It depends on value. Based on value alone, section 31.03(e) makes theft of $2,500 or more a felony and less than that a misdemeanor. At $300,000 or more it is a first degree felony.
Can small amounts be added together to make a felony?
Yes. Section 31.09 says amounts obtained pursuant to one scheme or continuing course of conduct, from the same or several sources, may be added together to set the grade.
Will paying the money back end the case?
Repayment is not listed as a defense in section 31.03. Restitution under article 42.037 is what a sentencing court orders after a conviction. Repaying early also creates a record about the amount, so talk to a lawyer first.
How long does the state have to file an embezzlement charge?
Felony theft is generally five years under article 12.01(4)(A). Theft by an executor, guardian, or trustee, and by a public servant of government property, carry ten. Misapplication under Chapter 32 carries seven. Class A and B misdemeanors carry two.
The law this article describes, at the source. Every figure above can be checked against it.
- Texas Penal Code, Chapter 31: theft (§§31.01, 31.02, 31.03, 31.08, 31.09)
- Texas Penal Code, Chapter 32: misapplication of fiduciary property (§32.45)
- Texas Penal Code, Chapter 12: punishment ranges (§§12.21 to 12.35)
- Code of Criminal Procedure, Chapter 12: limitations (arts. 12.01, 12.02, 12.05)
- Code of Criminal Procedure, Chapter 42: restitution (art. 42.037)
- Code of Criminal Procedure, Chapter 42A: community supervision (arts. 42A.053, 42A.101, 42A.102)
- Code of Criminal Procedure, Chapter 1: rights of the accused (art. 1.05)
This article is general legal information about Texas law, not legal advice about your case. Reading it does not create an attorney-client relationship. Laws change, so confirm the current rule with a licensed Texas criminal defense attorney about your specific facts. Request a free, confidential case review.