Theft of Government Property – 18 U.S.C. § 641 Sentencing Guidelines

Thanks for visiting Spodek Law Group, a second-generation firm managed by Todd Spodek with over 40 years of combined experience. When federal prosecutors charge theft of government property under 18 U.S.C. § 641, they’ve decided that taking, converting, or selling property belonging to the United States warrants federal rather than state prosecution. The statute covers everything from stealing staplers from federal offices to multi-million-dollar defense contract frauds. Maximum sentence depends on value: misdemeanor with one year maximum if property is worth $1,000 or less; felony with ten years maximum if it exceeds that threshold.

Here’s what troubles defense attorneys about Section 641: the statute criminalizes “converting to his use or the use of another” government property. That language is broad enough to prosecute federal employees who take home office supplies, contractors who repurpose surplus materials, and anyone who uses government resources for purposes beyond their authorized scope. The line between criminal conversion and acceptable personal use often gets drawn after the fact by prosecutors looking to charge someone they’ve targeted for other reasons.

What Counts as Government Property

The statute protects property owned by or in the possession of federal agencies, departments, or government corporations. Obvious examples include computers, vehicles, weapons, and office equipment purchased with taxpayer money. Less obvious: government-funded research data, proprietary information developed under federal contracts, materials purchased by contractors using government funds.

Federal courts have interpreted “property” expansively. Intellectual property qualifies—stealing classified documents, copying proprietary research, misappropriating trade secrets developed under government contracts. Even intangible property like honest services can fall under Section 641 in some circuits, though that interpretation remains contested after the Supreme Court narrowed honest services fraud in Skilling v. United States.

Time also counts as property. Federal employees who work on personal projects during duty hours, contractors who bill the government for time spent on private work, anyone who steals government-paid time faces Section 641 liability. That’s right—browsing Facebook on a federal computer during work hours is technically theft of government property if prosecutors want to charge it that way.

The Value Question

Everything turns on whether stolen property exceeds $1,000 in value. Below that threshold, Section 641 is a misdemeanor carrying one year maximum and typically resulting in probation for first offenders. Above it, you’re facing a felony with ten years maximum exposure.

How do prosecutors value stolen property? Market value at time of theft. For tangible items like computers or vehicles, that’s straightforward. For intangible property—proprietary research, classified information, time—valuation becomes an art project. Prosecutors hire experts who calculate development costs, replacement expenses, or market value if the information were sold. These valuations can be wildly inflated. Defense must retain competing experts to challenge government’s numbers, because the difference between $999 and $1,001 determines misdemeanor versus felony classification.

Who Gets Prosecuted Under Section 641

Federal employees who steal from their agencies. Contractors who divert government-purchased materials to personal use. Veterans who fraudulently obtain VA benefits by providing false information. Anyone who knowingly receives, conceals, or retains stolen government property. The statute isn’t limited to theft by government insiders—ordinary citizens who knowingly buy stolen military equipment, purchase pilfered federal property at suspiciously low prices, or fence goods they know came from government facilities face prosecution.

But here’s what actually drives most Section 641 prosecutions: retaliation and leverage. Federal agencies discover employees they want to fire for unrelated reasons, then scrutinize those employees’ computer usage, office supply consumption, personal phone calls made on government phones. Suddenly what every employee does—occasional personal internet use, taking home pens, making doctor’s appointment calls during lunch—becomes federal theft. Or prosecutors investigating contractors for major fraud add Section 641 counts for minor property misuse to pile on charges and create plea leverage.

The statute’s breadth means prosecutors can charge almost anyone who interacts with government property if they look hard enough. That discretion, combined with minimal judicial oversight of charging decisions, makes Section 641 a powerful tool for prosecutors targeting defendants they’ve decided to pursue.

Sentencing Under the Guidelines

The Federal Sentencing Guidelines treat theft under Section 2B1.1, which calculates offense levels based on loss amount. Theft of $1,001 to $6,500 yields base offense level 4—roughly probation to 6 months at Criminal History Category I. As amounts increase, offense levels climb: $6,500 to $15,000 gets level 6; $15,000 to $40,000 reaches level 8; $40,000 to $95,000 jumps to level 10. By the time losses exceed $1.5 million, you’re at offense level 20 or higher, facing 3-4 years even as a first offender.

Enhancements apply when defendants abused positions of trust, when thefts involved sophisticated means, when stolen property was obtained through fraud rather than simple taking. These enhancements add 2-4 levels, translating to 6-12 additional months of imprisonment.

Most Section 641 prosecutions involving federal employees result in single-digit month sentences or probation when amounts are modest and defendants have clean records. The government gets a felony conviction, the defendant loses their job and security clearance, and prison time often becomes secondary punishment compared to career destruction.

Restitution Is Mandatory

Courts must order restitution covering the government’s losses. For tangible property, that’s the item’s value or repair costs. For time theft, it’s salary paid for hours worked on personal matters. For proprietary information, it’s development costs or market value. Restitution orders can exceed the statutory maximum fine and remain collectible for decades through wage garnishment and asset seizure.

Defense challenges restitution amounts the same way we challenge loss amounts for offense level calculations. The government’s valuation methodology often inflates actual harm. Independent experts, market comparisons, and evidence showing government wouldn’t have paid the claimed amounts in arm’s length transactions all help reduce restitution obligations.

Defenses That Actually Work

Lack of intent to deprive permanently. Section 641 requires intent to steal, not just unauthorized borrowing. Federal employees who take home government laptops to work remotely, then return them, didn’t steal unless prosecutors prove intent to keep the laptops permanently or convert them to unauthorized use. Temporary unauthorized use might violate agency policies but doesn’t necessarily constitute theft under Section 641.

Authorized use. When defendants reasonably believed they had permission to use property or that their use fell within authorized purposes, criminal intent is negated. Evidence of supervisor approval, past practice showing similar uses were tolerated, or ambiguous policies that defendants interpreted reasonably all support lack-of-intent defenses.

Challenging government ownership. If property wasn’t actually owned by or in lawful possession of the United States, Section 641 doesn’t apply. Contractors who purchase materials with their own funds then use them on government projects own those materials—taking them home isn’t theft of government property even if the materials ended up in government facilities.

Why This Statute Gets Abused

Section 641’s breadth creates opportunities for selective prosecution. Federal agencies employ millions of people. Contractors work on thousands of government projects. If prosecutors scrutinize anyone’s conduct closely enough, they’ll find technical violations of Section 641—personal emails sent during work hours, office supplies taken home, government databases accessed for unauthorized purposes.

That universal potential liability means enforcement is necessarily selective. Who gets prosecuted? Whistleblowers who embarrass agencies. Employees involved in workplace disputes with management. Contractors who file complaints about fraud by other contractors. Defendants already under investigation for other offenses where prosecutors want additional charges to increase plea leverage.

The statute functions less as a neutral property-protection law and more as a tool enabling prosecutors to pursue people they’ve decided to target. When enforcement is this selective and potential violations this universal, we’re not really operating under rule of law—we’re operating under prosecutorial discretion that looks a lot like arbitrary power.

Constitutional scholars recognize this problem but courts have done little to constrain Section 641’s scope. The vagueness doctrine should limit statutes that criminalize ordinary conduct engaged in by millions without clear notice of what’s prohibited. But federal courts defer to congressional intent to broadly protect government property, leaving it to prosecutors’ discretion to decide who among the millions of potential violators actually gets charged.

When Small Thefts Become Federal Cases

A VA employee takes home boxes of pens over several years. Total value: $847. Prosecutors charge misdemeanor Section 641, employee pleads guilty, receives probation, loses job and pension eligibility. Was federal prosecution necessary? Could the VA have handled this administratively?

These prosecutions happen constantly. Federal agencies refer employees to prosecutors for minor property misuse that would be handled as employment matters in private sector. The employee loses everything—job, benefits, professional reputation—over conduct that warranted, at most, reprimand or termination.

Why prosecute criminally rather than administratively? Sometimes legitimate law enforcement interests. More often, agency politics, interpersonal conflicts between employees and supervisors, or agencies making examples of employees pour encourager les autres.

Defense attorneys in these cases focus on avoiding convictions entirely through pretrial diversion, deferred prosecution, or convincing prosecutors that federal criminal prosecution is disproportionate to the conduct. When clients face career-ending consequences from any conviction—security clearances revoked, professional licenses lost, VA benefits forfeited—even misdemeanors justify fighting rather than pleading guilty.

The Classified Information Problem

Section 641 frequently appears in classified information cases. Former intelligence officials charged with retaining classified documents face Section 641 theft charges alongside Espionage Act violations. Contractors who remove proprietary defense information get prosecuted under Section 641 for stealing intellectual property.

These cases raise constitutional questions about whether information can be “stolen” when defendants created or accessed it as part of their authorized duties. If a CIA analyst writes a report, is that report government property the analyst can “steal” by keeping a copy after leaving employment? Courts say yes, but the property law analogy feels strained when applied to information rather than tangible items.

The real concern in classified information cases is national security harm, not property theft. But prosecutors charge Section 641 because it’s easier to prove than Espionage Act violations and carries sufficient penalties to coerce guilty pleas. That prosecutorial convenience shouldn’t drive charging decisions when constitutional rights and proportionate punishment are at stake.

If you’re facing Section 641 charges, contact Spodek Law Group immediately. These cases require immediate response—challenging the government’s property valuations, investigating whether you actually lacked authorization for your conduct, and determining whether prosecution is retaliatory or pretextual. We handle federal theft cases at every level, from employee disputes over office supplies to contractor prosecutions involving millions in alleged losses. We’re available 24/7 because federal investigations move quickly and decisions made early determine whether you face charges at all or can resolve matters without criminal prosecution.