Caught in a Financial Crime? Navigating Embezzlement, Fraud, and Money Laundering Cases in Texas

Financial crimes like embezzlement, fraud, and money laundering carry serious consequences under Texas law. These offenses often involve intricate investigations, severe penalties, and life-changing repercussions. If you’re facing charges for a financial crime, understanding the allegations and working with an experienced criminal defense lawyer is crucial for protecting your rights and your future.

This guide breaks down common financial crimes in Texas, their penalties, and how skilled legal counsel can make a significant difference in your case.

What Are Financial Crimes?

Financial crimes, also known as white-collar crimes, typically involve the unauthorized use of money or assets for personal gain. While these offenses often lack physical violence, they are treated as serious crimes under both Texas and federal law due to their impact on victims and the economy.

Common Financial Crimes in Texas:

Some of the most common financial crimes in Texas include:

Embezzlement

Embezzlement occurs when an individual entrusted with someone else’s property or funds misappropriates them for personal use. Examples include diverting company funds into personal accounts or skimming money from business transactions.

Fraud

Fraud involves deceiving someone to gain financial or personal benefits. Types of fraud include:

• Identity theft
• Insurance fraud
• Wire fraud
• Credit card fraud

Money Laundering

Money laundering involves processing illegally obtained money to make it appear legitimate. This crime often includes transferring funds through various accounts or businesses to hide their origin.

Each of these offenses is prosecuted aggressively in Texas, often with the involvement of federal authorities.

Penalties for Financial Crimes in Texas

The penalties for financial crimes vary based on the nature of the offense, the amount of money involved, and the defendant’s prior criminal record.

Embezzlement Penalties

In Texas, embezzlement is prosecuted under the state’s theft statutes, with penalties determined by the value of the property or funds misappropriated. The severity of the punishment escalates with the amount involved, and public servants may face enhanced penalties.

• Less than $1,500: Classified as a misdemeanor, punishable by up to one year in jail.
• $1,500 to $20,000: Considered a state jail felony, carrying a sentence of up to two years in state jail.
• $20,000 to $100,000: Treated as a third-degree felony, with penalties ranging from 2 to 10 years in prison.
• $100,000 to $200,000: Designated as a second-degree felony, punishable by 2 to 20 years in state prison.
• More than $200,000: Classified as a first-degree felony, carrying a sentence of 5 to 99 years in state prison.

It’s important to note that state laws are subject to change. For the most current information, consult an attorney. 

Insurance Fraud Penalties

In Texas, insurance fraud is a serious offense with penalties that escalate based on the financial scale of the fraudulent activity. The consequences range from minor infractions to severe felony charges, with harsher punishments for higher monetary values or additional aggravating factors.

• Small-Scale Fraud (Under $100): Considered a low-level infraction, resulting in monetary penalties capped at a few hundred dollars.
• Fraud Between $100 and $750: Classified as a more serious misdemeanor, this level of fraud can lead to short-term incarceration and moderate fines.
• Fraud Involving $750 to $2,500: Treated as a higher-level misdemeanor, carrying penalties that include jail time and financial repercussions in the thousands.
• Amounts Between $2,500 and $30,000: Considered a felony with penalties that include confinement for several months to a couple of years, along with fines reaching significant amounts.
• Fraud Between $30,000 and $150,000: This offense carries more substantial penalties, including multi-year imprisonment and steep fines.
• Involving $150,000 to $300,000: Offenses at this level lead to prolonged incarceration spanning over a decade, paired with significant monetary penalties.
• Above $300,000: The most severe offenses, potentially resulting in sentences that could span decades or even life imprisonment, coupled with hefty fines.

Aggravating Factors

If the fraudulent activity endangers another person’s life or causes severe injury, the charge may be elevated to a higher level, resulting in even stricter consequences. Restitution is often mandatory, requiring offenders to reimburse insurers for losses and cover legal costs associated with their actions.

Given the complexity of these cases and the potential for life-altering penalties, consulting an experienced attorney is critical. An attorney can provide the guidance needed to navigate the legal process effectively and safeguard your future.

Identity Theft Penalties

In Texas, identity theft—legally termed “Fraudulent Use or Possession of Identifying Information”—is prosecuted under Texas Penal Code § 32.51. The severity of penalties depends on the number of identifying items involved and specific circumstances of the offense.

Penalties for identity theft in Texas include:

• Less than 5 items: State jail felony, punishable by 180 days to 2 years in a state jail facility and a fine of up to $10,000.
• 5 to fewer than 10 items: Third-degree felony, carrying 2 to 10 years in prison and a fine of up to $10,000.
• 10 to fewer than 50 items: Second-degree felony, resulting in 2 to 20 years in prison and a fine of up to $10,000.
• 50 or more items: First-degree felony, punishable by 5 to 99 years, or life imprisonment and a fine of up to $10,000.

Additionally, if the offense is committed against an elderly individual (defined as someone 65 years or older), the charge is elevated to the next higher category of offense. Upon conviction, courts may also order restitution to victims for financial losses incurred due to the offense.

Money Laundering Penalties

In Texas, engaging in money laundering carries severe consequences, with punishments varying depending on the amount involved. The seriousness of these charges escalates with the monetary value of the offense.

• Amounts Below $2,500: Considered a minor offense, leading to monetary fines of up to $500.
• Between $2,500 and $30,000: Treated as a more significant violation, potentially resulting in up to two years in confinement and fines reaching $10,000.
• From $30,000 to $150,000: Classified at an intermediate level, with penalties including incarceration ranging from two to ten years and financial penalties of up to $10,000.
• Ranging Between $150,000 and $300,000: Offenses in this bracket are subject to harsh punishment, including incarceration spanning two decades and substantial fines.
• Exceeding $300,000: The most serious category, with repercussions that may involve up to life imprisonment and hefty fines of $10,000.

Understanding the significant implications of money laundering charges is essential to navigating these cases. Given the complexity of the legal process and the potential for severe outcomes, securing experienced legal counsel is critical to protecting your rights and future.

The Importance of Legal Representation

Financial crime cases are often complex, involving extensive paper trails, digital evidence, and lengthy investigations. Defendants frequently face well-prepared prosecutors backed by significant resources. Having a skilled criminal defense lawyer on your side is essential to level the playing field.

How a Lawyer Can Help

Here’s a few ways having a lawyer can help you with your case:

• Analyzing Evidence: Your lawyer will carefully review financial records, communications, and other evidence to identify weaknesses in the prosecution’s case.
• Challenging Investigations: Defense attorneys can scrutinize how evidence was collected to ensure it was obtained legally. If any violations occurred, the evidence may be suppressed.
• Negotiating with Prosecutors: An experienced lawyer can negotiate plea deals to reduce charges or minimize penalties, potentially avoiding a felony conviction.
• Building a Strong Defense: By crafting a strategic defense tailored to your case, your lawyer can challenge the allegations and present exculpatory evidence.

Defending Against Financial Crime Charges

Defending against financial crime allegations requires a deep understanding of both criminal law and the financial systems involved. Below are some common defense strategies:

Lack of Intent

Many financial crimes, such as fraud or embezzlement, require proof of intent. If your actions were accidental or the result of a misunderstanding, this can be a strong defense.

Insufficient Evidence

The prosecution must prove guilt beyond a reasonable doubt. A skilled lawyer can highlight gaps or inconsistencies in the evidence to undermine the case against you.

Coercion or Duress

If you were forced to participate in illegal activities under threat, this defense could reduce or eliminate your liability.

Mistaken Identity

In cases involving identity theft or digital fraud, proving you were not the individual responsible for the crime is a valid defense.

How Financial Crime Investigations Unfold

Understanding the typical steps in a financial crime investigation can help you prepare for what lies ahead:

Initiation of Investigation

Investigations often begin with a complaint from an employer, bank, or victim. Federal agencies like the FBI or IRS may become involved for larger cases.

Evidence Collection

Investigators gather financial records, emails, transaction histories, and witness statements to build their case.

Charges Filed

Once sufficient evidence is collected, formal charges are filed, and the defendant is notified through an arrest or summons.

Trial Preparation

The prosecution prepares its case, and the defense works to counter allegations, potentially negotiating a resolution before trial.

Court Proceedings

If the case proceeds to trial, both sides present evidence and arguments, and a judge or jury determines the outcome.

Steps to Take If You’re Accused of a Financial Crime

If you’re facing allegations of embezzlement, fraud, or money laundering, taking immediate action can improve your chances of a favorable outcome.

Contact a Lawyer Immediately

Speak with an experienced criminal defense lawyer before discussing your case with law enforcement or anyone else.

Preserve Evidence

Gather any documents, emails, or records that could support your defense.

Stay Silent

Avoid making statements to investigators without your lawyer present, as anything you say can be used against you.

Follow Legal Advice

Trust your attorney to guide you through the process and make informed decisions about your defense.

Call Chernoff Law for Experienced Criminal Defense in Texas

Financial crime charges are serious and demand equally serious legal representation. At Chernoff Law, we have the experience and knowledge to navigate the complexities of financial crime cases, from embezzlement to money laundering. Our team is dedicated to protecting your rights and achieving the best possible outcome for your case.

Don’t let financial crime allegations define your future. Call 713-222-9141 or or fill out our online contact form to schedule a case evaluation. We help clients in Houston and across Chambers County, Fort Bend County, Galveston County, Harris County, and Montgomery County.

Disclaimer: This blog is intended for informational purposes only and does not establish an attorney-client relationship. It should not be considered as legal advice. For personalized legal assistance, please consult our team directly.