Defining Embezzlement
Embezzlement is the act of dishonestly appropriating or stealing funds or property entrusted to one’s care, often by an employee or someone in a position of trust. It involves the misappropriation of assets for personal gain, typically through the manipulation of financial records or bypassing internal controls.
Examples of Embezzlement
Some common examples of embezzlement include:
- An employee skimming cash from a register
- A financial advisor diverting client funds into personal accounts
- A trusted family member siphoning funds from a relative’s estate
Case Studies
In 2009, Bernie Madoff was arrested for operating the largest Ponzi scheme in history, duping investors out of billions of dollars through embezzlement. Another notable case is that of Enron, where executives were found guilty of embezzling funds to inflate company profits.
Statistics on Embezzlement
According to the Association of Certified Fraud Examiners, embezzlement accounts for approximately 5% of all fraud cases reported, with an average loss of $1.2 million per case. It is estimated that businesses lose billions of dollars annually to embezzlement schemes.
