Case Defending Against Occupational Embezzlement | Occupational Embezzlement and Breach of Trust, Non-Referral

The client, who came to face a charge of occupational embezzlement, had served as a deputy manager in the sales department, handling the settlement of transportation payments with business partners and reporting to the head office, and recently resigned.

Shortly after the resignation, however, the company filed a criminal complaint on the ground that a portion of the past cash settlements had not been deposited with the head office.

Moreover, a charge of occupational breach of trust was also applied, placing the client at risk of criminal punishment.

The client emphasized that at the time there had been a practice of not delivering the settlement payments to the head office directly, but instead handing them to another sales employee who was traveling to the head office. The company denied this, however, and attributed all responsibility to the client.

The client therefore requested the assistance of a criminal law attorney in order to respond immediately.

In addition, where one obtains an unlawful benefit in breach of one's duty, or causes a third party to obtain a benefit and thereby inflicts a loss, occupational breach of trust may also apply.

Elements of occupational breach of trust

In summary, occupational embezzlement is established where a person who keeps another's property in the course of business embezzles that property or refuses to return it.

By contrast, occupational breach of trust is established where a person who handles another's affairs in the course of business, by an act in breach of that duty, acquires a pecuniary benefit or causes a third party to acquire it, thereby causing loss to the principal.

If charges of occupational embezzlement and occupational breach of trust are found to be established, the following punishment is imposed.

Lacking the time to deliver the payment directly to the head office, the client had used a method of delivering the settlement funds to the head office's operations division through a sales representative traveling on business.

This was a practice, and in most cases it was processed normally.

The criminal law attorney accordingly emphasized that there was no direct evidence that the client had used the settlement funds personally, and that no intent to obtain an unlawful benefit was recognized either.

The complainant argued that the client had omitted an essential verification procedure in the course of a transaction, causing financial loss to the company.

In reality, however, it emerged that the client had properly carried out the procedures for receiving the transaction payment and reporting in the course of handling the work, and that at the time no particular issue had been raised within the company.

Accordingly, there were no circumstances at all indicating that the client had obtained personal benefit or had intentionally sought to cause loss to the company, and the attorney emphasized that the ‘intent to gain unlawful benefit,’ a key requirement of the breach of trust charge, was likewise not recognized.

In this case, the client merely performed the work in accordance with ordinary procedures and practice, did not foresee or recognize that loss would arise to the company, and had no intent whatsoever to seek a benefit.

The criminal law attorney accordingly emphasized, on the basis of precedent, that for breach of trust to be established a mere occupational error or the occurrence of loss is not sufficient, and that there must be recognition that pecuniary loss will arise to the principal.

Supreme Court Decision 88Do542, decided May 24, 1988

Accordingly, the attorney logically argued that the elements of breach of trust, namely recognition of the breach of duty, recognition of the occurrence of loss, and intent to obtain an unlawful benefit, were not satisfied.

A charge of occupational embezzlement or breach of trust can be correctly assessed in law only by comprehensively considering various circumstances, such as the background of the transaction, the company's internal reporting and settlement procedures, and whether the practice was customary.

Daeryun LLC operates a system of assigning a responsible attorney who designs a strategy tailored to each field.

In addition, the firm supports the review of materials required given the nature of the case, such as accounting and financial analysis, and provides a systematic response so that a charge is not unfairly recognized.

If you are currently under investigation for occupational embezzlement or occupational breach of trust, or face the risk of indictment, 🔗legal consultation appointment, we invite you to obtain assistance without delay through a legal consultation appointment.