Federal Embezzlement and Employee Theft

Employee embezzlement is the taking of money or property by a person who was trusted to handle it for an employer. It is a federal crime when a federal statute covers that money or property, such as property of the United States, a bank, an employee benefit plan, or a program that receives federal funds.

If you, or someone you are helping, has been charged with federal embezzlement or employee theft, or has learned that investigators are asking about missing money at work, the sections below cover what these charges mean, when they become federal, and what sentences they carry.

The stakes are high. A conviction can lead to a long prison sentence, a fine, and restitution, which means paying back the value of what was taken. It can also wreck your job prospects. That makes the money owed even harder to pay, and it can be a real hardship for you and your family.

What is the difference between embezzlement and employee theft?

Embezzlement and employee theft are different crimes, but they are closely related. Think of employee theft as a broad category. It covers any kind of stealing from the place where you work. Embezzlement is one specific kind of employee theft.

What sets embezzlement apart is trust. It is done by someone who was trusted to handle money or property for an employer, such as a bookkeeper, bank teller, or office manager. The person was given access to the organization's money or property and then took some or all of it for personal use without permission. The Supreme Court described embezzlement as the fraudulent taking of property "by a person to whom such property has been intrusted" (Moore v. United States, 160 U.S. 268 (1895)).

If you are charged with either crime, talk with a lawyer who handles federal embezzlement and employee theft cases before you answer questions from investigators or your employer.

When does embezzlement become a federal crime?

Every state has its own laws against embezzlement and employee theft. A case becomes federal when the money or property is connected to something federal law protects. The most common example is property of the federal government. If a federal employee takes property from the job, federal theft law applies (18 U.S.C. § 641). The same law covers property being made or built under a contract with the United States, so an employee of a federal contractor can face federal charges too.

Federal law also reaches money taken from federally insured banks, from employee benefit plans, from health care benefit programs, and from state, local, or tribal agencies and private groups that receive federal funds. As with many federal crimes, a wide range of conduct can be treated as criminal in the right circumstances.

Which federal laws cover embezzlement and theft?

Four statutes cover most federal employee-embezzlement and theft charges. Each one is tied to a federal connection, not to the job title alone.

• 18 U.S.C. § 641, public money, property, or records: up to 10 years. If the aggregate value across all counts of conviction in the case is $1,000 or less, the maximum is 1 year.
• 18 U.S.C. § 656, theft, embezzlement, or misapplication by a bank officer or employee: a fine of up to $1,000,000, up to 30 years, or both. If the amount is $1,000 or less, the maximum is 1 year.
• 18 U.S.C. § 664, theft or embezzlement from an employee benefit plan: up to 5 years.
• 18 U.S.C. § 666, theft or bribery concerning programs receiving federal funds: up to 10 years.

Section 666 also reaches bribes. In Snyder v. United States, 603 U.S. 1 (2024), the Supreme Court held that § 666 covers bribes to state and local officials but does not make it a crime for those officials to accept gratuities for their past acts.

Federal law sorts these crimes by the type of property taken or the type of government body or organization involved. The property can be almost anything, and many different people can be charged. Chapter 31 of Title 18 of the U.S. Code includes separate laws for:

• Court officers who misuse money held by the court (18 U.S.C. §§ 645–647)
• Custodians misusing public funds (18 U.S.C. §§ 648–649)
• Depositaries failing to safeguard deposits (18 U.S.C. § 650)
• Disbursing officers who misuse or shortchange public payments (18 U.S.C. §§ 651–653)
• Theft by a bank examiner (18 U.S.C. § 655)
• Embezzlement by employees of a bank, lending, credit, or insurance institution (18 U.S.C. §§ 656–657)
• Property mortgaged or pledged to farm credit agencies (18 U.S.C. § 658)
• Solicitation or use of gifts (18 U.S.C. § 663)
• Embezzlement from an employee benefit plan, such as a union or company retirement or health plan (18 U.S.C. § 664)
• Programs receiving federal funds (18 U.S.C. § 666)
• Theft of livestock (18 U.S.C. § 667)
• Theft of major artwork (18 U.S.C. § 668)
• Embezzlement in connection with health care (18 U.S.C. § 669)

Read the full list of federal embezzlement and theft laws (18 U.S.C. Chapter 31)

What if your company or organization is being investigated?

An organization, such as a company or nonprofit, can be charged with federal embezzlement or theft from the federal government. So can the people who run it. If you are an officer or supervisor connected to the activity the government is looking at, talk to a lawyer as soon as you learn about the investigation or charges. That way you can avoid saying or doing something that pulls you personally into the case against the organization. This is true even if you think your part was small or indirect.

How much prison time can you face for federal embezzlement?

One of the biggest factors in the sentence is how much the government shows was taken. In general, the higher the dollar amount, the higher the fine and the longer the prison term. The federal sentencing guidelines, the rules a federal judge must consult when choosing a sentence, raise the recommended range as the loss goes up (USSG §2B1.1). That guideline is among the provisions amended effective November 1, 2026, so the manual in effect on the sentencing date controls.

On top of any prison sentence, a federal judge can impose a fine of up to twice the amount the person or organization gained, or twice the loss, if that is more than the usual maximum fine (18 U.S.C. § 3571(d)).

For theft of government property under 18 U.S.C. § 641, an aggregate value of $1,000 or less across the counts of conviction is a misdemeanor. It carries up to one year in jail and a fine of up to $100,000 (18 U.S.C. § 3571(b)(5)). If the aggregate value is more than $1,000, the crime is a felony. It carries up to 10 years in federal prison and a fine of up to $250,000 (18 U.S.C. § 3571(b)(3)). Restitution and other factors can make the total punishment even heavier.

Other embezzlement laws have their own maximums:

• Federal employee taking someone else's property that came to them through the job (18 U.S.C. § 654): up to 10 years. If $1,000 or less, up to 1 year.
• Bank officer or employee (18 U.S.C. § 656) and covered credit and insurance institutions (18 U.S.C. § 657): up to 30 years and a fine up to $1,000,000. If $1,000 or less, up to 1 year.
• Programs that receive federal funds (18 U.S.C. § 666): up to 10 years.
• Employee benefit plans (18 U.S.C. § 664): up to 5 years.
• Health care benefit programs (18 U.S.C. § 669): up to 10 years. If $100 or less, up to 1 year.

How federal sentences are calculated (Sentencing.net)

Criminal Center's guide to federal embezzlement and theft chargesIt goes through the main statutes, the penalties and the defense issues these cases tend to raise.

How long does the government have to charge you?

Most non-capital federal crimes must be charged within five years, unless another statute sets a different limit (18 U.S.C. § 3282). Theft, embezzlement, or misapplication by a bank officer or employee under 18 U.S.C. §§ 656 and 657 has a 10-year limit (18 U.S.C. § 3293(1)).

Why does it help to bring in a lawyer early?

A federal embezzlement or employee theft charge can damage both your career and your personal life, and a conviction follows you. A lawyer can review the evidence, explain which defenses may apply, and, if there is a conviction, address the factors that affect the sentence.

What should you do next?

Book a consultation and tell us what happened.

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