White Collar Crime

White-collar crime refers to financially motivated, nonviolent crime typically committed by business and government professionals. It’s characterized by deceit, concealment, or violation of trust and often involves fraud, embezzlement, and more. These crimes can significantly impact the economy, investor confidence, and financial stability.

Examples of White Collar Crime

• Embezzlement: When someone entrusted with money or property misappropriates it for personal use.
• Criminal Fraud: Schemes intended to deceive or cheat for financial gain, including identity theft and perjury.
• Securities Fraud: Manipulating the market or deceiving

Embezzlement

Embezzlement occurs when a person entrusted with someone else’s assets illegally

appropriates them. This crime is most common in employment and corporate settings. In Michigan, embezzlement is a serious offense, governed primarily by two statutes:

MCL § 750.174 and MCL § 750.181. These laws articulate the legal boundaries and

penalties associated with the misappropriation of funds or property by individuals in positions of trust or responsibility.

MCL § 750.174: Embezzlement by Agents, Servants, or Employees

Under MCL § 750.174, embezzlement occurs when a person, in a position of trust (such as an agent, servant, employee, trustee, or custodian), fraudulently disposes of, converts, takes, or secretes money or personal property belonging to another entity or individual. This statute outlines various scenarios and corresponding penalties based on the value of the property or money embezzled. The punishments range from misdemeanors for smaller amounts (under $200) to felonies for larger sums, with the most severe penalties reserved for amounts exceeding $100,000.

This statute outlines two specific forms of embezzlement:

1. Concealing Property: This involves hiding the principal’s property with the intention of converting it for personal use without the principal’s consent.
2. Fraudulent Disposal or Conversion: This refers to unlawfully disposing of or converting the principal’s property for personal use.

Essential Elements of Embezzlement

• Property Ownership: The property or money embezzled must belong to the principal. This was emphasized in cases like People v Schrauben and People v Kurrle.
• Rightful Possession: The agent must have rightfully come into possession of

the property or money through their trusted position. The relationship of trust is a pivotal aspect of this statute.

MCL § 750.181: Embezzlement Involving Part Ownership

MCL § 750.181 specifically addresses situations where the embezzled property is partly owned by the embezzler and partly by another party. This statute clarifies that even partial owners can be guilty of embezzlement if they unlawfully use or withhold property against the consent of the other part owner. Similar to MCL § 750.174, the penalties

under MCL § 750.181 are tiered based on the value of the property involved, ranging from misdemeanors to felonies.

Key Points in Michigan’s Embezzlement Laws

• Value-Based Penalties: The severity of the punishment in embezzlement cases is largely determined by the value of the embezzled property or money. The higher the value, the more severe the penalty.
• Position of Trust: Embezzlement charges typically apply to individuals who have legal access to another’s property or funds due to their professional or official position.
• Partial Ownership: Even individuals who are part owners of the property can face embezzlement charges if they misuse or withhold the property without the consent of the other owner(s).

Criminal Fraud

Criminal fraud involves deceit or misrepresentation for financial or other benefits. It covers a broad range of activities where the perpetrator deceives others for gain.

Examples of fraud include: Identity theft, credit card fraud, securities fraud, and insurance fraud.

Identity Theft

Identity theft, a serious and increasingly prevalent crime, can begin with something as simple as accessing an individual’s Social Security Number and birthdate. This form of crime, where a person’s identity is used without their permission, often leads to the unauthorized opening of credit accounts and other fraudulent activities. In Michigan, identity theft is not just a violation of personal privacy but also a criminal act charged as a felony.

Credit Card Fraud

In Michigan, credit and debit card fraud, a subset of financial crimes, is taken very seriously. This type of fraud encompasses a range of activities, all involving the unauthorized use of another person’s credit or debit card information. The crime doesn’t necessarily require physical possession of the card; mere access to the card number can suffice for fraudulent activity. This kind of fraud is often interlinked with identity theft, as it typically involves using someone else’s identity details to avoid personal payment obligations.

Securities Fraud

In Michigan, securities fraud is a critical issue, primarily when it involves misleading

investors about the financial status or prospects of a company whose shares they might buy or sell. This malpractice, defined under the Michigan Uniform Securities Act § 451.2101, includes various deceptive actions that can significantly undermine investor trust and the integrity of financial markets.

Securities fraud in Michigan encompasses actions where individuals or entities engage in deceitful practices related to the sale, purchase, or valuation of company stocks (securities). The Act outlines specific unlawful acts, including:

• Utilizing deceitful schemes or devices to defraud
• Making false statements or omitting crucial facts about a security, thereby misleading investors.
• Conducting practices that operate as fraud or deceit in any securities-related

Advisors or entities who provide investment advice for compensation must also avoid these fraudulent practices. The gravity of securities fraud is reflected in its classification as a Class D felony in Michigan, punishable by up to 10 years in prison and/or fines reaching $500,000 per violation.

Insurance Fraud

In Michigan, insurance fraud is a significant crime that can take various forms, affecting both consumers and insurance companies. It involves deceitful activities related to insurance claims and payments, and the state takes robust measures to combat and penalize such actions.

Insurance fraud in Michigan includes several deceptive practices:

1. Filing False Claims: This occurs when an individual knowingly lies about or conceals important facts in insurance claims, such as inflating the value of a claim or fabricating damages.
2. Destruction for Gain: Organizing the damage or destruction of property, such as a vehicle, home, or business, to collect insurance payouts.
3. Exaggerating Injuries: Overstating the severity of injuries to exploit workers’ compensation benefits.
4. Billing for Non-rendered Services: Healthcare providers billing insurance companies for medical services that were never provided.

Forgery

Forgery involves creating, altering, using, or possessing false documents with intent to commit fraud. This includes altering legitimate documents or creating fake ones.

In Michigan, forgery and counterfeiting are serious crimes that encompass a range of fraudulent activities involving the creation, alteration, or use of false documents or items. Governed by MCL § 750.248, these offenses are treated as felonies, with substantial penalties for those convicted.

Scope of the crime

• Forgery in Michigan typically involves the alteration, making, or signing of a written document with the intent to deceive. This could include actions like signing another person’s name on a will or check.
• Counterfeiting commonly refers to creating fake goods or money and presenting them as genuine. While related to forgery, counterfeiting often specifically targets the production of fraudulent currency, financial instruments, or other valuable items.

Types of Forged or Counterfeit Items

• The law prohibits forging or counterfeiting various documents, including records, bank bills, promissory notes, public records, and real property records.
• It’s also illegal to use forged or counterfeit documents or items, such as presenting a falsified financial transaction device (like a debit or credit card) with the intent to defraud or injure another person.
• Possession of tools used for counterfeiting is equally prohibited under Michigan

Legal Representation

Given the complexity of white-collar crimes, professional legal representation is crucial. A skilled attorney can help navigate the legal system, develop a defense strategy, and work towards minimizing potential penalties.

If you’re facing charges or have been a victim of such crimes, it’s essential to seek experienced legal counsel. At B. Kizy Law, we specialize in white-collar criminal defense and are committed to protecting your rights and interests.