Public officers tasked with handling or overseeing public money usually hold their positions with little or no oversight. Sometimes these people might abuse their positions to enrich themselves using taxpayers’ money under their trust. Under California laws, specifically Penal Code 424, anyone accused and convicted of public funds misappropriation can face a lengthy prison sentence and a hefty fine.
You should seek help from a professional criminal attorney to ensure that your rights are upheld and probably have your charges dismissed if you are arrested and accused of misappropriating public funds. Contact us at the Orange County Criminal Defense Attorney Law Firm for a thorough assessment of your allegations and learn how we can help you.
How Misappropriation of Public Funds is Defined under California Laws
Misappropriation of public funds is considered a California crime under Penal Code 424. This statute usually charges state and local public officers, but it can affect anyone tasked with government money control.
Definition of Public Officer
Under Penal Code 424, a public officer is any state or local government employee entrusted with taxpayers’ money management. This includes accountants, lawyers, appointed officials, rank-and-file employees, and non- governmental employees with control or custody of public money. Therefore, anyone tasked with the disbursement, management, safekeeping, or other taxpayers’ money responsibility falls under this category.
A typical example of misappropriation of public funds is when someone who runs a non-profit organization receives money from the government but decides to use it for their living expenses. In this situation, this person can be charged under Penal Code 424, even though he or she is not a government official since there is public money involved.
Instances that Describe Misappropriation of Public Funds in California
There are several ways listed by Penal Code 424, in which a person can misappropriate public funds. These ways are as follows.
Appropriating Public Funds without legal Authority
A person can misappropriate public funds in California using the funds for personal use or use by another person without any legal authority. Under this form of misappropriation, the elements of the crime are as follows:
- You were a state officer and was entitled to safe-keep, transfer, or disburse public funds
- You used the public money for your personal use or allowed another person to use the funds without authority
- You knew that using public funds was prohibited or did not find whether the other person had a legal authority to use the money
Under these elements of the crime, several terms stand out and require a detailed explanation. As explained above, a state officer is any government or non-governmental employee with the mandate or responsibility of public funds. When it comes to describing public funds' misappropriation, it means using the money to benefit yourself or benefit someone else like your family member or friend.
Lastly, criminal negligence or knowledge means that you knew that the actions were against the law or failed to determine whether it was against the law. Knowing that your acts are unlawful does not mean that you knew all the details about the law. The mere knowledge of a particular non-criminal action can put you at risk of prosecution under this statute. Therefore, this is different from ordinary negligence, which is the failure to exercise reasonable care, since it includes gross, aggravated, or recklessness in your actions.
An instance that defines "ordinary negligence" is when you assume a public office without the full knowledge of the ordinances related to taxpayer’s money and does an action considered as misappropriation of taxpayer’s money in California. If you are accused of misappropriating public money, you might not be guilty of Penal Code 424 since the actions were out of ordinary negligence.
Misusing, Loaning, or Profiting from Public Funds without Authority
You can be prosecuted under this statute if:
- You are a public, state, or local government officer charged with the responsibilities of public money
- The law specifically prohibits you from profiteering, loaning, or using public money, but
- You decided to loan, profit, or use the public money against the authorization of the law
- And you knew that your actions were illegal or you were criminally negligent in knowing whether the actions were legal or not
Please note, you can still be prosecuted under this statute even if you return the funds to the proper authorities after its misappropriation.
Using False Account, Altering, or Destroying Public Funds Accounts
You can be accused and prosecuted for misappropriating of public funds if you:
- Knowingly make a false entry, erasure, or keep a false account used for public money
- Conceal, obliterate, falsify, obliterate, or destroy a public fund account to defraud
Based on the above description, you can violate Penal Code 424 even when you did not personally misappropriate the funds as long as you knowingly altered, destroyed, or tampered with a public money account.
For instance, suppose you know that your fellow employee is taking money from the public account, but decides to cover up the unlawful act by shredding all the incriminating documents. You can be prosecuted under the statute since you have the intention to defraud your authorities by destroying the records.
Refusal to Pay or Transfer Public Money
Finally, you can be prosecuted under Penal Code 424 if you refuse to transfer or pay public funds when required to do so or authorized by the law to do so. You could be charged under this form of misappropriation if you knew what you should, but failed to do so or were criminally negligent in failing to do what you are expected to do.
Legal Definition of Knowingly, Willfully, and Intentionally
When a person does something knowingly, it means that the person knew the nature of the conduct and its circumstances. Therefore, the person is conscious and substantially confident that the action will precipitate a particular result. Since this term is used in your charges under Penal Code 424, it means that you knew what you were doing, and subject to your knowledge decided to continue engaging in it hence the allegations made against you.
Another term used to describe your action is willful. There is no specific definition of this term, but ordinarily, it means doing something with a criminal intention, whereas the act is intrinsically wrong or an act of moral turpitude. Therefore, if you are involved in an activity that is well-known to be a form of misappropriating public funds, you will be considered to have done it willfully.
Finally, doing something “intentionally” means doing something deliberately. Someone acts "intentionally" while expecting a particular result or engages in conduct described by the law as an offense. The offender should have conscious knowledge of the act as an offense to fit into this description. Therefore, in violation of Penal Code 424, you are considered to have intentionally misappropriated public money if you engage in conducts such as altering, falsifying, or destroying a taxpayer’s money account for your gain. In that case, you were aware of the consequences of the action but decided to commission it.
Comparison of Misappropriation, Larceny, and Embezzlement
There is a very close relationship between misappropriation, embezzlement since they are all types of theft. These conducts have different meanings and are charged under various statutes. Let's have a closer look at their differences.
Most people think larceny as a synonym to theft. However, it means taking something that you do not rightfully own and is not in your possession. A common form of larceny is shoplifting an item from a shop.
This involves taking a property that you have in possession but is not yours. Most people involved in this crime are entrusted in management or control of someone else's property but use it for their benefit. For instance, an employee who uses a company's property for a personal project can be accused of embezzlement. Embezzlement can involve both money or other property.
A misappropriation is a form of embezzlement that only involves money. For instance, if you transfer a public fund to your account, you can be accused of embezzlement and misappropriation of the funds.
You can easily confuse larceny with robbery. However, it involves the forceful taking of another person's property through physical attacks, restrain, or placing the person under reasonable fear of an imminent attack.
Exceptions in Violation of Penal Code 424
You could not be prosecuted for violating Penal Code 424 if you misappropriated a small amount of money. For instance, if you were involved in taking $20 from the taxpayer’s cash registry, you are not guilty of this offense since the situation can be incidental and the amount involved is minimal.
Penalties for Misappropriation of Public Funds in California
Misappropriation of public money is a felony in California. If you are found guilty of this crime, the potential consequences include:
- Felony or formal probation
- 2, 3, or 4 years of imprisonment in a state prison
- A maximum fine of $10,000
A California state employee cannot hold any public office in California if found guilty of violating Penal Code 424.
What you Need to Know About Felony or Formal Probation
Judges can convert your felony charge to a felony or formal probation under discretion. Felony probation is a designated procedure that allows offenders to be rehabilitated and make law-abiding citizens. Therefore, they serve most of their sentence under a probation officer's supervision instead of staying in custody.
In most cases, formal probation can include up to one year in county jail or no jail time, depending on the type of crime.
Once a judge has decided to place a defendant under probation, there are particular conditions that he or she must follow. Some of the conditions that can be placed on you for misappropriation of funds include:
- Payment of restitution – Probably the funds that you are found guilty of misappropriating
- Community labor or service
- Unwarranted searches on you or your property
- Monthly meeting with the probation officer
If you violate felony probation, the judge might revoke probation or send you back to prison or jail and impose the maximum sentence. If you give a good reason for violating the probation, the judge may let it slide but might increase probation length and impose harsher conditions.
Suitable Legal Defenses to Charges Under Penal Code 424
A successful conviction under Penal Code 424 puts you at risk of losing your career and facing severe consequences. However, with a criminal attorney's help, you can have your case dismissed or reduced to a less severe lawsuit based on their legal defenses. Below are some of the suitable legal arguments that can work in your charges.
Your Misuse of Funds was Incidental or Minimal
Under Penal Code 424, you can be accused of misappropriating taxpayer’s money only when there is a considerable amount of money involved. Therefore, if the amount involved in the allegation is significantly low, your case can be dismissed by the court. However, the fact that your funds were incidental or minimal depends on the circumstances surrounding your case.
Your Actions Were Not Negligent or Willful
One of the crime elements used to prosecute a person under Penal Code 424 is the intent to defraud. However, if you can disapprove of the fact that you had the intention to defraud, the court might decide to dismiss your case or charge you with a less severe crime. For instance, if your actions were out of ordinary negligence as the case of the public officer who assumes a public office in the example described above, you cannot be prosecuted for violating Penal Code 424.
Please note, ignorance of the law is not a legal defense. However, if you can prove that your action was an honest and reasonable mistake belief that it is legal, you cannot be prosecuted under this statute.
Your Used the Money for the Right Purpose
Sometimes you can be accused of misappropriating public funds, whereas you used it for the right purpose. If you intend to disapprove of this fact, you should present the necessary receipts showing your proper use of the money. Therefore, your attorney should assert that you had no intention of misusing the funds since your actions were under your superior's direction.
Most superiors can have their employees engage in misappropriation of funds for their gain, which is usually the case while using this legal defense.
The Funds Do Not Qualify as Public Funds
Public funds or money usually come from the government to help the public in accessing services or goods. Most public funds are generated from taxation, licensing, and payment of fines. Therefore, you cannot be prosecuted for violating Penal Code 424 if the alleged money came from your account. This situation is common with non-governmental organizations run by individuals, occasionally funded by the government, and relies on one bank account.
Claim That You Were Under Duress
Your criminal conduct can be pardoned if you committed it with a reasonable belief that you or your loved one is in danger. In this case, your attorney should prove that someone else threatened you or your family member to have you involved in the misappropriation of funds. You can use evidence such as recorded calls and text messages to prove your innocence. Once you establish this fact, the court might decide to prosecute the actual perpetrator and dismiss the charges filed against you.
Claim That Your Actions Were Out of Necessity
Public funds are usually kept in several secure accounts and are placed under the custody of specific people. Therefore, you can decide to engage in an act that is considered as a misappropriation of public money if you had the intention to stop fraud or misuse of the fund.
For instance, suppose you are a public official and realizes that a particular person with authorization on the account intends to misuse the money. Therefore, you decide to transfer the funds to your account until investigations are over, but you are accused of misappropriating public funds. In this case, the court can dismiss these allegations only if you can prove that you did not intend to defraud but protect the money from misuse.
Sometimes rogue police officers are involved in different forms of misconduct during arrest, investigation, or interrogations. For instance, police officers should have a warrant to search or seizure your property during the arrest. Therefore, if they conduct an unwarranted search or seizure, any evidence collected through this misconduct cannot be accepted by the court. Other forms of police misconduct include:
- Forcible interrogations
- Failure to avail an attorney upon your request
- Giving a false statement in court
You need to prove beyond a reasonable doubt that the law enforcement officer engaged in the form of police misconduct to use this legal defense. Once you demonstrate these facts, your attorney should file a suppression motion hearing that requires the court to exclude any evidence collected via police misconduct. If the court grants this motion, there are chances of dismissal of your case.
It is uncommon to be prosecuted based on false accusations, but it can happen if you attempt to cover your criminal involvement. You can also be accused if someone intends to revenge or jealousy of your position as a public officer. It is easy to prove false allegations in a case involving misappropriation of taxpayers’ money since there must be evidence proving that you were involved in a criminal action. Therefore, if there is no direct evidence proving your involvement in any unlawful act, you cannot be prosecuted.
Crimes Related to Misappropriation of Public Funds in California
There are other crimes related to the misappropriation of public funds in California. The prosecutor can decide to charge you with these crimes besides the charges under Penal Code 424. These crimes are as follows.
Penal Code 503: Embezzlement
Under California Penal Code 503, embezzlement is the unlawful taking of a property that has been entrusted to you to deprive the rightful owner of the use of the property. This crime becomes a felony if the property in question is worth more than $950.
In California, embezzlement is punished as grand theft under Penal Code 487 or petty theft. You can be charged as grand theft if the property in question is worth more than $950, a firearm, or an automobile.
A grand theft charge is a wobbler, meaning you can face misdemeanor or felony charges. A misdemeanor offense is punishable with a maximum of one year in county jail, and a felony charge can lead to a maximum of three years in county jail.
If the property in question is worth less than $950, this becomes a misdemeanor petty theft embezzlement. The potential punishment includes a maximum of one year in county jail.
Penal Code 67 and 68: Bribery of a Public Officer
Bribery of a public officer is often charged along with misappropriation of taxpayers’ money if the perpetrator tries to bribe a public officer or another person to conceal the criminal conduct. The kind of punishment related to this crime depends on specific situations. This includes a county jail sentence, fines, forfeiture of office, and disqualification from future office.
Bribery is considered a felony, but you can be sentenced to the county jail for two to four years, depending on the circumstances.
Penal Code 470: Forgery
Penal Code 470 defines forgery as creating or using written documents to commit a fraud willfully. Forgery is a wobbler with a maximum of one year in a county jail for a misdemeanor and 16 months to three years in the county jail for a felony sentence in California. You could be prosecuted for embezzlement and forgery if you used forged documents to withdraw money from taxpayers’ money accounts.
Find a White Collar Defense Attorney Near Me
The criminal procedure for prosecution under Penal Code 424 can be frustrating. However, a criminal defense attorney can help you navigate this process with ease and ensure that you obtain the best possible results. At the Orange County Criminal Defense Attorney Law Firm, we aggressively fight for our clients’ rights by adopting the best defenses to solve their crisis. Contact us today at 714-740-7848 and schedule an appointment.