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What is Misappropriation?

In a business setting, misappropriation usually focuses on the embezzlement of funds and stealing trade secrets. These white-collar crimes are taken seriously by law enforcement. A conviction could mean facing steep fines and a lengthy incarceration.

If you suspect that one of your employees has misappropriated funds or trade secrets, you will want to talk to a Miami, Florida business litigation attorney right away. A business attorney does not handle the criminal aspect, but they can help you mitigate the damage to your company. Let’s explore the concept, what is misappropriation?

An Overview of Embezzlement

If your business involves the handling of cash, one of your employees might get tempted to “borrow” some of the funds without permission. People often find it difficult to resist what looks like a quick and easy solution to their financial problems when they have other peoples’ money physically in their hands.

Banks and retail establishments are particularly susceptible to employee theft, also known as embezzlement. Some of the common reasons people give to justify taking money that doesn’t belong to them on the job include: 

  • Massive bills they cannot afford to pay, like medical expenses
  • Gambling debts
  • General mismanagement of their personal finances

Sometimes, people who dip their hand into the till originally have every intention of paying back the money before they get caught. When their financial picture does not make it possible for them to return the stolen money, they usually end up getting caught. 

Misappropriation of funds could involve a cashless transaction. For example, a bookkeeper at a company might write checks to herself or transfer funds electronically from a company account into her personal bank account. Also, a cashier in a retail shop might misuse credit card information of customers to make unauthorized purchases, which can be misappropriation.

What Constitutes Misappropriation of Trade Secrets

It is illegal in Florida to intentionally misappropriate a trade secret from the party who owns the trade secret or to withhold the control of the trade secret from its owner. Misappropriating a trade secret can happen without physically stealing the item. Making a copy of an item that represents a trade secret can constitute misappropriation. 

Returning the item after misappropriation is no defense. In Florida, misappropriation is often charged as a felony. A conviction can result in thousands of dollars in fines and years in prison. 

The Required Elements of Misappropriation

The crime of misappropriation is not something that happens by accident. To get convicted of misappropriation in Florida, the prosecutor has to prove all three of these elements:

  1. The defendant had possession or control of or access to funds or trade secrets belonging to another party or entity who entrusted those things to the defendant.
  2. The defendant intentionally and knowingly took an action that resulted in the funds or trade secrets getting misappropriated.
  3. The defendant converted the funds to their own use or received a benefit from the use of or sale of the trade secrets.

The dollar value of the misappropriation will determine the penalties and the severity of the criminal charges. A Miami, Florida business attorney can help you set up protocols to protect your company from embezzlement and misappropriation of trade secrets. Get in touch with our office today for legal assistance, we gladly offer a free consultation.