Embezzlement, Theft, Or Misapplication By A Bank Officer Or Employee 18 USC Section 656

So You’re Being Investigated for Embezzlement as a Bank Employee? What to Expect

Getting that ominous call from your bank’s legal team or the police can be terrifying. You may be completely innocent, but the mere suggestion of embezzlement or theft can turn your world upside down. This article will walk you through what to expect if you’re being investigated under 18 USC Section 656 for embezzlement or misapplication as a bank employee.

First off–don’t panic. An investigation does not necessarily mean you’re guilty or will be charged. The bank may just be following up out of an abundance of caution. However, you should take any investigation seriously. These cases can lead to felony charges, so consulting a criminal defense lawyer is wise.

What Does 18 USC Section 656 Say?

This federal law makes it illegal for bank employees or officers to embezzle, steal, purloin or willfully misapply money, funds, or credits belonging to the bank. In plain English–don’t steal from your employer.

The law applies to national banks as well as FDIC-insured banks. Credit unions are not covered. Penalties can include up to 30 years in prison and steep fines.

How Do Investigations Typically Unfold?

If auditors notice any questionable transactions linked to you, the bank will likely conduct an internal investigation first. They may interview coworkers, review accounts you handle, and look for red flags like:

• Suspicious transfers
• Missing funds
• Circumventing approval processes
• Falsified records

If they find potential fraud, they may put you on leave while contacting authorities. The FBI or IRS often get involved in these complex cases.

You’ll likely be asked to come in for questioning. This is when having a lawyer is crucial. They can advise you on answering questions and prevent self-incrimination. Be cooperative, but don’t admit to anything without representation.

In addition to interviews, investigators dig into your finances, communications, and activities at work. Expect them to subpoena personal financial records, emails, call logs, and more. They’ll review case law too, looking for precedents similar to your situation.

What Are Some Common Defenses in Section 656 Cases?

There are various defenses a skilled lawyer may use if you’re charged, such as:

• You lacked criminal intent – The law requires willful misapplication of funds. If it was an accident or misunderstanding, that could rebut charges.
• You had authority – Employees who have authority to handle financial transactions can defend their actions if properly authorized.
• The bank wasn’t FDIC insured – Section 656 only applies to federally insured banks and credit unions.
• The money didn’t “belong” to the bank – The funds have to be bank property for it to be considered theft or embezzlement.
• You were coerced – If bullied or threatened into committing fraud by a superior, it may excuse violations.
• You relied on professionals – Reasonably relying on legal, financial, or compliance advice could weaken accusations.
• You were entrapped – If investigators encouraged you to commit a crime you otherwise wouldn’t have, entrapment defenses may apply.

What Are the Consequences if Convicted?

As mentioned, Section 656 violations can lead to 30 years in federal prison and up to $1 million in fines. The length of sentences depends on the amount stolen and other factors. You may also get banned from banking and have to pay restitution.

Beyond jail time, a felony conviction also leads to losing certain rights and privileges. Voting rights, gun ownership rights, and access to government benefits may be revoked. Some professional licenses can be suspended too.

Take a Breath, Stay Calm

Being accused of bank fraud is terrifying, but don’t assume the worst. Hire a lawyer you trust and let them handle communications. Be honest with your legal team and follow their advice. If you’re innocent, stick to the facts so they can build your defense.

While the process is stressful, thousands have navigated these investigations without charges. Remain patient and compliant, but know your rights. This too shall pass.