Interpretation of the Crime of Embezzlement in Criminal Private Prosecution

        In the digital age, I believe everyone has experience with online transfer, but if you accidentally transfer the wrong account, how can you protect your rights and strive for a refund from the payee? In this issue, we will analyze relevant legal knowledge through a payment recovery case.

                1、 Case Introduction

        A well-known cross-border e-commerce enterprise with multiple patents worldwide and customers in over 30 countries and regions. At the beginning of 2019, during internal accounting, it was discovered that the payments for multiple online stores under the company were not properly recorded. After investigation, it was found that the above-mentioned payments were all transferred from the online stores to the wrong receiving account, with a total amount exceeding USD 1.5 million.

        The company immediately contacted the actual payee and hoped that they would return the funds. However, in terms of receiving payments, the huge temptation has evolved from initially evading and obstructing to refusing to return, attempting to embezzle this huge amount of money.

        2、 Court Trial

        According to Article 270 of the Criminal Law of the People's Republic of China, the crime of misappropriation refers to the act of illegally taking possession of someone else's property, forgotten items, or buried items that are kept for the purpose of illegal possession, and refusing to return them in large amounts. From this, it can be seen that the crime of embezzlement is the act of the perpetrator, based on the purpose of illegal possession, converting the legally possessed property into their own illegal possession by refusing to return it. In the aforementioned case, the elements that constitute the crime of embezzlement include: the funds of an online store belong to someone else's property that is kept on behalf of them, the defendant has the subjective purpose of illegal possession, and the defendant has committed an objective act of refusing to return them.

        3、 The judge's statement

        Article 270 of the Criminal Law stipulates that the criminal subject of the crime of embezzlement is a natural person, and the object of embezzlement is "other people's property that is kept on behalf of others". It is usually a custody state formed based on legal relationships, such as commission, lease, pledge, etc. There is no clear limitation on "agency" in the article. In other words, the object of the crime of embezzlement includes not only the property of others that is entrusted, leased, pledged or other legal acts, but also the property of others that is entrusted or entrusted based on a certain factual state. When the funds in this case were mistakenly transferred to the defendant's account, the defendant had already gained control over the disposal of the funds, which is sufficient to determine that it constitutes a state of "custody of other people's property on behalf of others".

        "The purpose of illegal possession", as a subjective constituent element, needs to be supported by objective behavior in practice. Therefore, "refusal to return" should be a supplement to "the purpose of illegal possession". The two can complement and explain each other, and have their own independent meanings. They should be determined based on specific cases, victims, and the different types of objects being occupied. In this case, the property involved in the case is monetary property. When the private prosecutor's funds were mistakenly transferred to the defendant's account, the defendant withdrew the funds, refused to communicate with the private prosecutor, and artificially set negotiation barriers, which constitute the elements of "refusal to return". This is a typical act of embezzlement and clearly points to the defendant's purpose of "illegal possession".

        4、 The boundary between "civil unjust enrichment return lawsuit" and "criminal embezzlement crime self prosecution"

        1. Civil procedure and criminal procedure are independent of each other and not mutually exclusive

        The point of dispute that needs to be resolved in civil proceedings lies in the plaintiff's legitimate rights over the object, while the focus of dispute in criminal proceedings is whether the constituent elements are realized or not. The two are independent and not mutually exclusive. In terms of legal principles, criminal cases usually involve civil legal relationships, but there are differences in purpose, background, and concept, so the methods and focuses of regulating social behavior also differ. According to the principle of legality of crime and punishment, the constituent elements are the only criterion for determining whether a crime has been committed. Therefore, whether a case involves civil legal relationships does not affect the realization of the constituent elements, and therefore cannot negate the jurisdiction of criminal law.

        2. Application of the crime of embezzlement

        In addition to misappropriating entrusted property, leased property, and pledged property, in disputes related to asset holding, if the holding agreement expires and the rights holder requests return but refuses to return it, the crime of misappropriation also applies. As mentioned earlier, cases of misappropriation of funds are also applicable to safeguard legitimate rights and interests. However, it should be noted that the criminal subject of the crime of embezzlement can only be natural persons, companies, and other units.

        5、 Case inspiration

        Due to the fact that the crime of embezzlement belongs to a criminal private prosecution case and follows the rule of handling only after being informed, and compared to public authorities, the strength of the private prosecutor is weak and the difficulty of obtaining evidence is high, there are certain difficulties in initiating criminal proceedings to protect rights. The application rate in the entire judicial practice is relatively low, and the boundary between "civil unjust enrichment return lawsuit" and "criminal embezzlement crime private prosecution" is blurred, and there are similarities between the two, As a result, this crime has gradually become a "textbook" charge, and many courts have not accepted similar cases in recent years. In terms of the burden of proof, the constituent elements of the right to request in civil law are simpler than those of the crime of embezzlement, and it is easier to prove that the victim has a legitimate right to property and related elements; For private prosecutors, limited judicial resources make it very difficult to prove the defendant's illegal possession purpose. On the other hand, initiating criminal private prosecution has its unique advantages. In terms of the intensity of sanctions, it has more obvious advantages in recovering funds and deterring defendants.

        *Image source: freepik

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