Also known as: lawfully possess · lawful possessor · legal possession
Written by attorneys · grounded in primary & secondary sources — see below
Possession of another's property acquired or held with the owner's consent or under legal authority rather than by trespass. This status distinguishes embezzlement, which requires initial lawful possession followed by fraudulent conversion, from larceny, which requires a trespassory taking at the moment of acquisition.
Lily Lopez serves as head curator at a nonprofit art museum. The board entrusts her with authority to catalog and display donor sculptures. She later loans one sculpture to a private gallery for a personal fee while falsifying records to conceal the transaction. Because Lily held the sculpture with the museum's consent from the outset, her later conversion satisfies the elements of embezzlement.
Luke Latham, an attorney appointed trustee for a client's settlement proceeds, deposits the funds in an escrow account under his control. He then uses the money for personal gambling losses instead of disbursing it to the client. Luke's initial lawful possession through his trustee role turns the misappropriation into embezzlement.
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Landon Long, previously convicted of a disqualifying offense, keeps a handgun inside his home for protection against intruders. The statute prohibits possession by such offenders unless the possession qualifies as lawful. The court holds that self-defense possession in the home does not meet the lawful possession element required to avoid liability.
Embezzlement requires that the defendant hold the property lawfully at the time of the initial acquisition or entrustment and then convert it later. Larceny instead requires a trespassory taking from someone with a superior right of possession at the moment the defendant first obtains the property.
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No. Low-level employees typically hold only custody rather than lawful possession of employer property. Misappropriation by such an employee constitutes larceny rather than embezzlement because the initial taking is trespassory.
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Yes. When mandatory verification steps or supervisor approvals are conditions precedent to valid issuance of funds or property, failure to complete them means the defendant never acquires lawful possession. The conduct then aligns with larceny rather than embezzlement.
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A bona fide claim of right negates the fraudulent intent required for embezzlement even when the defendant holds lawful possession. Open assertions of the belief that the property is owed as compensation can support the defense.
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…stealing is a conversion, but certainly not every knowing conversion is a stealing. “To steal means to take away from one in lawful possession without right with the intention to keep wrongfully .” (Italics added.) Irving Trust Co. v. Leff , 253 N. Y. 359, 364, 171 N. E. 569, 571. Conversion, however, may be consummated without…