Top Law Firms in NYC | Damages against Embezzling Employee

The client was a corporation operating a web design and digital services business, conducting projects for commercial clients while managing multiple revenue streams and operational accounts within the metropolitan area. 

Due to the nature of its business, the company relied heavily on stable cash flow to meet payroll obligations, vendor payments, and ongoing project costs. 

Over a period exceeding ten years, the company entrusted a senior employee with comprehensive responsibility over corporate bank accounts, corporate credit cards, and internal financial administration, creating a high-trust environment that ultimately became a point of vulnerability.

Irregularities were first detected when approximately USD 3 million equivalent was discovered to have been transferred from a corporate account into the employee’s personal account. 

When questioned, the employee claimed the transfers resulted from external phishing or smishing incidents, characterizing the events as accidental and unforeseeable. 

However, a subsequent forensic review of financial records revealed that the transfers were not isolated incidents but part of a repeated pattern, with more than fifty transactions executed over an extended period, conclusively undermining any claim of inadvertence.

Counsel secured comprehensive bank transaction records, corporate accounting logs, and digital authentication data to demonstrate that the employee personally initiated each transfer using their own device and credentials. 

By mapping transaction timing, frequency, and access logs, the legal team established a clear pattern of intentional misappropriation rather than error or third party interference. 

This evidence supported findings of both embezzlement and breach of fiduciary duty, satisfying the intentionality threshold required for full civil liability under District of Columbia tort principles.

Beyond the misappropriated sums themselves, counsel documented the operational harm suffered by the company as a direct result of the sudden depletion of working capital. 

Evidence showed delayed payroll payments, late fees imposed by vendors, and short-term financing costs incurred solely to maintain business continuity.

By presenting these facts in an organized damages matrix, the legal team demonstrated a direct causal link between the employee’s unlawful conduct and the company’s measurable financial losses, reinforcing the basis for full compensation.

The employee had worked with the company for more than a decade, gradually accumulating exclusive control over sensitive financial functions without immediate oversight. 

Counsel argued that this trust was not incidental but central to the employee’s ability to commit the misconduct undetected over time.

The deliberate exploitation of this trust elevated the seriousness of the conduct and distinguished it from ordinary negligence or isolated wrongdoing.

Even after the transactions were uncovered, the employee continued to deny wrongdoing and attempted to attribute the losses to external fraud. 

Counsel highlighted this conduct to demonstrate lack of remorse and ongoing evasion, reinforcing the conclusion that the acts were intentional and calculated. 

This positioning further undermined the employee’s credibility and supported the court’s acceptance of the plaintiff’s factual narrative.