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  1. #1

    Default Embezzlement by a Bookkeeper

    My question involves criminal law for the state of: CA

    What criminal charges does the following fact pattern support? Embezzlement, grand theft, fraud, all the above and more???? Felony I would think?

    The bookkeeper was laid off due to lack of work recently. As I began to help with the business, it soon became apparent the person was "cooking the books" and editing credit card statements to mask their 4+ years (so far) of embezzling from the company. Without getting too specific, I'll share what is very obvious. And yes, we do have LE involved, but very early in. Bookkeeper had not been contacted by LE yet, and we have not contacted said bookkeeper.

    So far, person is into us for ~$100K. Likely to go higher. Restitution is a non-starter, person doesn't have the money.

    Methods used:

    1. Person made purchases (online and in person) on their own assigned company credit cards which are obviously for personal gain and not business related. THEN, after downloading the company CC statements from the bank, they edited their charges in Adobe Acrobat to make the charges appear to be business related. eg Person buys Dodgers tickets for their personal use, then edits the company CC statement to show Costco purchase of business related purchases for same amount. Then approving the "fake" purchases and even giving them the appropriate G/L coding for accounting purposes. This person also generates the company checks to pay the CC charges. Person presents the altered statements coded for accounting purposes, along with a company check to the owner, owner does a cursory review, signs the check to pay the CC company, the fraud cycle is complete.

    2. Person made online purchases and payments to their personal creditors (car payments & more) using 2 other employee's CC information. Then, as described above, edited the charges on the statements to appear legit. Because the company had non-existent procedural "checks and balances" to have legitimate accountability, the 2nd & 3rd employees would not even see the CC statements of their card activity, so they were never aware of the fraud.

    Please don't get me started on all the "usual and customary" business practices which would have prevented this crap. I know that and in the process of setting up correct practices for them. I'm in this trying to help them unf**k the situation and believe me, it's a mess.

  2. #2
    Join Date
    Jan 2006
    Posts
    38,867

    Default Re: Bookkeeper Embezzling, Fraud, Altering Credit Card Statements to Hide Fraud

    I have no idea what you are looking for. You say you have law enforcement involved. You say the employee can't repay the money. What else do you want to do?

    So, was this just a story you wanted to share or were you looking for something?

  3. #3

    Default Re: Bookkeeper Embezzling, Fraud, Altering Credit Card Statements to Hide Fraud

    Just venting a bit I guess, but this is so early in, we're curious about the particulars of the crimes, how they are charged and consequences to the criminal. Seems like all the elements are present for embezzlement, the pattern and duration of fraud for all the covering up and editing company business documents, etc. and we can definitely show $100K which will be next to impossible for the person to explain away. I have to think even for a first offender this has to be a felony that could carry a minimum of 6 months to a few years at least of incarceration.

    Looking for opinions or maybe suggestions about how we could help LE because we've heard about their backlog of cases. I'm supposed to get a call back this afternoon from LE for a status on what they have done so far.

  4. #4
    Join Date
    Dec 2013
    Posts
    835

    Default Re: Bookkeeper Embezzling, Fraud, Altering Credit Card Statements to Hide Fraud

    There are SOOOO many paths this could take it would be impossible to list them all.
    1) the prosecutor could choose not to do anything.
    2) They could be charged with a number of different things. My parents were victims of something VERY similar, and the woman was found guilty of a variety of charges including Theft, tampering with records, etc. The felony classes ranged from 3rd to 5th degree felony. The whole process took nearly two years to the day from start to finish, but could have gone longer.
    3) She could be offered a deal.
    4) She could go to trial and be found not guilty.

    You probably aren't going to be able to make this go faster. Just make sure that you aren't causing any hold ups. If they ask you for something, give it to them promptly, etc.

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