1. What Is the Difference between Fraud and Embezzlement in New York?
Fraud and embezzlement are distinct crimes, though both involve dishonest financial conduct. Fraud occurs when someone intentionally deceives another person to obtain money, property, or services, while embezzlement specifically involves an employee or trusted individual misappropriating funds or assets entrusted to them. Both offenses carry serious consequences under New York Penal Law.
Defining Fraud under New York Law
Fraud in New York encompasses various schemes where a person knowingly makes false representations with intent to defraud. Under New York Penal Law § 155, larceny by fraud is prosecuted as a felony when the value of property stolen exceeds certain thresholds. Fraud can involve written documents, verbal misrepresentations, or concealment of material facts. The prosecution must prove that you acted with intent to defraud and that the victim relied on your false statements.
Understanding Embezzlement Charges
Embezzlement occurs when an employee, officer, or fiduciary misappropriates funds or property that lawfully came into their possession during employment or service. Unlike simple theft, embezzlement involves a breach of trust and is prosecuted under New York Penal Law § 155 as larceny. The key element is that the accused person had lawful access to the property but converted it for personal use without authorization.
2. How Can Fraud and Embezzlement Accusations Impact My Future?
Convictions for fraud and embezzlement can permanently damage your reputation, employment prospects, and financial stability. Criminal records are accessible to employers, creditors, and licensing boards, making it difficult to secure employment or professional credentials. Civil liability may also arise, requiring you to repay stolen amounts plus interest and damages.
Criminal Penalties and Sentencing
Penalties for fraud and embezzlement in New York depend on the amount involved and prior criminal history. Felony convictions can result in prison sentences ranging from one to fifteen years, substantial fines, and restitution orders. Misdemeanor convictions carry up to one year in jail. Additionally, professional licenses may be revoked, and you may face deportation if you are not a U.S. Citizen.
Civil Consequences and Restitution
Beyond criminal penalties, victims may pursue civil lawsuits seeking recovery of stolen funds, compensatory damages, and punitive damages. Courts may also impose injunctions preventing you from working in certain industries or accessing financial accounts. Restitution orders require defendants to repay all stolen amounts, and civil judgments can affect your credit score and financial future for years.
3. What Defenses Are Available If I Am Accused of Fraud or Embezzlement?
Several legal defenses may apply to fraud and embezzlement charges, depending on the specific circumstances of your case. Common defenses challenge whether the prosecution can prove intent, whether you had authorization to use the funds, or whether the alleged victim actually relied on any misrepresentation. Consulting with an experienced attorney is critical for evaluating which defenses apply to your situation.
Lack of Intent and Authorization
A primary defense involves demonstrating that you lacked the intent to defraud or that you had legitimate authorization to use the funds in question. If you received verbal or written permission to access or use company assets, or if you reasonably believed you had authority, this may negate criminal intent. Additionally, if you intended to repay embezzled funds and took steps to do so, this may influence sentencing or support a plea negotiation.
Challenging Victim Reliance and Related Fraud Issues
For fraud charges, the prosecution must prove that the victim relied on your false statements in making a financial decision. If the victim knew the statements were false, failed to investigate obvious red flags, or made decisions based on other factors, reliance may not be established. Aiding and abetting fraud charges may also be challenged by demonstrating you did not knowingly participate in or encourage the fraudulent scheme. Mistaken identity, fabricated evidence, or inconsistent witness testimony can also undermine prosecution claims.
4. When Should I Contact a Fraud and Embezzlement Defense Attorney in New York?
You should contact a criminal defense attorney immediately if you are under investigation, questioned by law enforcement, or arrested for fraud and embezzlement. Early legal intervention can protect your rights, prevent self-incrimination, and preserve evidence in your favor. Delaying representation may result in waived rights and reduced negotiating power with prosecutors.
Investigation and Evidence Gathering
| Action Item | Timeline |
|---|---|
| Request police reports and evidence | Within 10 days of arrest |
| Preserve financial records and communications | Immediately upon notice |
| Identify potential witnesses | Before trial preparation |
| Consult forensic accountants if needed | During early defense phase |
Negotiation and Plea Considerations
An experienced attorney can negotiate with prosecutors to reduce charges, minimize sentencing recommendations, or arrange alternative resolutions such as diversion programs or restitution agreements. Cases involving land fraud or complex financial schemes may benefit from expert analysis and strategic negotiation. Your attorney can also advise whether accepting a plea agreement serves your interests better than proceeding to trial, considering the strength of evidence and potential outcomes.
10 Feb, 2026
