Defendant’s wife, an administrative employee, took a corporate signature stamp without permission and wrote unauthorized corporate checks, thereby misappropriating funds from her employer. She had access to the checks and the signature stamp, but was not authorized to write checks without obtaining prior permission from her supervisor or to use the stamp. The defendant aided and abetted his wife to embezzle funds from the two companies.
The Supreme Court of North Carolina affirmed the judgment of the appellate court.
While there is similarity in some respects between larceny and embezzlement are different offenses even though there are similarities between them. Larceny is a common law. Embezzlement is a statutory crime and involves fraudulent acts distinct from elements of larceny.
Larceny is defined as a wrongful taking and carrying away of the property of other person without owner’s consent. Here, felonious intent must be proved without reasonable doubt.
According to N.C. Gen. Stat. § 14-90 (2003) the embezzlement is a fraudulent conversion of personal property by other person who enjoys position of trust or some fiduciary relationship. After appropriation the property enters lawful possession of the embezzler with intent to his own use. In North Carolina “misappropriation by trespass supports the offense of larceny, not embezzlement”.
Whether the defendant aided and abetted his wife embezzle funds; (b) whether his wife committed embezzlement or aided and abetted larceny; (c) whether both were co-conspirators to commit embezzlement and larceny.
The Supreme Court of North Carolina held that the trial court erred by denying defendant’s motion to dismiss the charges of embezzlement and conspiracy to embezzle. Following statement of the initial court was rejected by the Supreme Court: “…defendant aided and abetted embezzlement committed by his former wife, because: (1) defendant cannot be convicted of aiding and abetting embezzlement without proof that an embezzlement was committed; (2) the lawful possession or control element of the crime of embezzlement was not satisfied when an administrative employee took a corporate signature stamp without permission and wrote unauthorized corporate checks thereby misappropriating funds from her employer, and these facts appear to support the crime of larceny rather than embezzlement; (3) defendant’s former wife was not her employer’s agent and she never lawfully possessed the misappropriated funds; and (4) it is immaterial whether the former wife had actual or constructive possession of the misappropriated funds when her possession was not lawful, and thus, the crime of embezzlement has not occurred”.
The Supreme Court delineated that the wife was never in lawful charge of misappropriated funds. Therefore, it was not reasonable to state that she did commit the crime of embezzlement as defined in N.C. Gen. Stat. § 14-90. The Supreme Court thus concluded that “the charges against defendant should have been aiding and abetting larceny and conspiracy to commit larceny. Because the State could not make the allegations and proof correspond, the appellate court properly reversed defendant’s conviction”.
The term “conversion” in context of embezzlement denotes a fraudulent appropriation of the property entrusted to an embezzler under fiduciary responsibility with intent of unauthorized use or exercising right of ownership over it in defiance of the owner’s rights.