Embezzlement charges in Michigan carry penalties that scale with the dollar value of what was taken, from a 93-day misdemeanor for amounts under $200 up to a 10-year felony when the total exceeds $20,000. The charge is distinct from ordinary theft because it requires a breach of trust: someone who was given lawful access to money or property converted it for personal use. How much was taken usually matters more than how it happened.
Penalties by Dollar Amount
Michigan’s embezzlement statute, MCL 750.174, sets four tiers. Each tier carries a jail or prison maximum and a fine capped at either a fixed amount or three times the value of the property, whichever is greater.1Michigan Legislature. MCL 750.174 – Embezzlement by Agent, Servant, or Employee
- Under $200: misdemeanor, up to 93 days in jail and a fine of up to $500 or three times the value.
- $200 to $1,000: misdemeanor, up to 1 year in jail and a fine of up to $2,000 or three times the value.
- $1,000 to $20,000: felony, up to 5 years in prison and a fine of up to $10,000 or three times the value.
- Over $20,000: felony, up to 10 years in prison and a fine of up to $15,000 or three times the value.
Prior convictions push a charge into a higher tier. One prior theft-related conviction moves a sub-$200 case into the $200-to-$1,000 range. Two or more priors can turn a small-dollar embezzlement into a felony.1Michigan Legislature. MCL 750.174 – Embezzlement by Agent, Servant, or Employee
How Small Thefts Become Felonies
Michigan allows prosecutors to add up multiple incidents that are part of a scheme or pattern of conduct within any 12-month period and charge the total as a single offense. An employee who skims $500 a month for a year does not face twelve misdemeanors; they face one felony based on the $6,000 aggregate.2Michigan Legislature. MCL 750.174a
When every incident targets the same victim, there is no 12-month limit at all. A bookkeeper who siphons small amounts from the same employer over three years can be charged on the entire total.2Michigan Legislature. MCL 750.174a This is why many people who think they are facing a minor case are actually looking at a felony once the prosecutor finishes adding things up.
What the Prosecution Has to Prove
In People v. Lueth, the Michigan Court of Appeals set out six elements for an embezzlement conviction:
- The money or property belonged to the principal.
- The defendant was an agent, employee, or someone in a similar position of trust.
- The defendant gained possession of the property because of that trust relationship.
- The defendant used, hid, or converted the property for personal benefit.
- The owner did not consent to the conversion.
- The defendant acted with intent to defraud or cheat the principal at the time of the conversion.3Michigan Courts. People v Lueth
Missing money is not enough. The prosecution has to prove fraudulent intent existed at the moment of the conversion. The court described the statute as targeting situations where “the agent gains access to the principal’s money through a position of trust and either simply steals it from him or attains control of the money through deception.”
Defenses That Actually Move the Case
No Fraudulent Intent
If the defendant genuinely believed they had permission to use the funds, or thought the money was being spent on a legitimate business purpose, the intent element can fail. The Court of Appeals in Lueth treated the question of what the defendant intended at the time of the taking as “a matter for the jury as the factfinder,” which means it is routinely a live, contested issue at trial.3Michigan Courts. People v Lueth
Owner Consent
There is no embezzlement if the owner knew about and approved the use. Consent can be written and explicit, or it can be implied from a pattern where the owner regularly allowed similar uses. The owner does not have to have been happy about it; authorized is enough.
Mistake or Bad Bookkeeping
Sloppy accounting is not a crime. A genuine misunderstanding of financial records, instructions, or the scope of a defendant’s authority undercuts the case for intentional wrongdoing. This defense comes up often in small businesses with informal practices.
Disputing the Dollar Amount
Because the tier depends entirely on value, challenging the number is sometimes the most practical defense available. Dropping a prosecution’s figure from $25,000 to $18,000 turns a 10-year felony into a 5-year felony. Forensic accountants are often central to these fights.
How Long Prosecutors Have to File
Michigan’s general limitations statute requires an indictment to be filed within six years after the offense was committed.4Michigan Legislature. 2024 PA 0268 – Statute of Limitations The clock runs from when the embezzlement happened, not when it was discovered. Combined with the aggregation rules, this means a long-running scheme can be charged in full as long as some act in the scheme falls within the six-year window.
Restitution and the Civil Suit That Follows
Restitution is almost always part of an embezzlement sentence. Michigan courts routinely order defendants to repay the full loss, and the obligation continues even during incarceration. Paying it back does not take prison off the table in higher-tier cases, though it often matters for first-time offenders being considered for probation.
A conviction does not end the financial exposure. Michigan allows embezzlement victims to file a separate civil conversion suit under MCL 600.2919a and recover three times their actual damages, plus attorney fees and court costs. An employee who embezzles $50,000 can face a $150,000 civil judgment on top of criminal fines and restitution.
The civil case runs independently. A victim can sue even if the criminal charges are dismissed, and the civil burden of proof (preponderance of the evidence) is lower than the criminal one.
Professional Licenses and Expungement
An embezzlement conviction can end a career in finance, healthcare, law, or any licensed field. FINRA treats all felony convictions and certain misdemeanor convictions as “statutory disqualification” events that bar a person from working at any member firm for up to 10 years from the date of conviction, with reinstatement only through a formal eligibility proceeding.5FINRA. General Information on Statutory Disqualification and FINRA Eligibility Proceedings Licensing boards for CPAs, attorneys, and healthcare professionals apply similar bars.
Michigan’s Clean Slate laws do allow embezzlement convictions to be expunged, but the waits are long. A single felony requires at least five years after completion of sentence, probation, or parole. Multiple felonies push the wait to seven years. Misdemeanor embezzlement (other than those classified as serious misdemeanors) requires a three-year wait.6State of Michigan. Attorney General – Expungement Assistance Embezzlement is not on the list of offenses excluded from expungement, so eligibility turns on meeting the wait and staying within the overall cap of three felony convictions. Expungement removes the conviction from public view but not from law enforcement databases.
When the Case Becomes Federal
Embezzlement can be charged federally when it involves government property, federal program funds, bank funds, or interstate commerce. The most common statute, 18 U.S.C. § 641, carries up to 10 years in prison, dropping to one year when the value does not exceed $1,000.7Office of the Law Revision Counsel. 18 USC 641 – Public Money, Property or Records Federal sentences are served at 85% with no traditional parole. The federal limitations period is five years from the date of the offense.8Office of the Law Revision Counsel. 18 U.S. Code 3282 – Offenses Not Capital A defendant can face both state and federal charges for the same conduct, because each sovereign prosecutes on its own authority.