The Difference Between Embezzlement, Fraud, and Theft

Legal Literacy - This article explains the differences between embezzlement, fraud, and theft as regulated in positive law in Indonesia.

I am an entrepreneur who has a trusted employee whom I entrusted to bring the office's inventory car. However, to cut a long story short, the car was lost, and after finding out, I learned that the car was sold by my trusted employee.

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In this case, I want to report my employee's actions. The question is, can these actions be categorized as embezzlement, fraud, or theft?

Perhaps we need to know the definition of embezzlement before discussing it further. According to the Kamus Besar Bahasa Indonesia (Great Dictionary of the Indonesian Language), embezzlement is an action that involves the process, method, and act of embezzling or misappropriating goods illegally. In a more specific sense, embezzlement can be explained as behavior that damages the trust of others by not fulfilling promises and not behaving well.

Lamintang and Djisman Samosir stated that the term embezzlement should be interpreted as "abuse of rights" or "abuse of trust." Van Haeringen, as quoted by Lamintang and Djisman Samosir, provides the understanding that the term "verduistering" or "embezzlement" means "making everything dark" or "preventing light from shining."

In Article 372 of the Criminal Code (KUHP), embezzlement is defined as the act of a person who intentionally and unlawfully, possesses an item that is wholly or partly the property of another person and is in his power for no legitimate reason.

The Crime of Embezzlement consists of several elements, namely subjective and objective elements. The subjective element is the perpetrator's intention to embezzle the property of another person as formulated in the article of the law through the words "intentionally." Meanwhile, the objective element consists of the element of anyone, the element of controlling unlawfully, the element of an object, the element of part or all of it belonging to another person, and the element that the object is in his possession not because of a crime.

There are several types of Embezzlement in the Criminal Code Criminal Law (KUHP), including: embezzlement in basic form, petty embezzlement, aggravated embezzlement, embezzlement within the family, and embezzlement in Article 377. In addition, there are also other criminal acts regarding embezzlement, namely Articles 415 and 417 which are crimes of office that are regulated separately in Chapter XXVIII which regulates crimes of office. 

Embezzlement in its principal form is regulated in Article 372 of the Criminal Code (KUHP), while petty embezzlement is regulated in Article 373 of the Criminal Code. Article 372 of the Criminal Code constitutes the crime of embezzlement in its principal form, where a person intentionally and unlawfully claims as their own property that is wholly or partly owned by another person, but which is in their possession not because of a crime. Meanwhile, Article 373 of the Criminal Code concerns the crime of embezzlement with elements similar to Article 372 of the Criminal Code, but differing in that the embezzled item is not livestock and its value does not exceed twenty-five rupiah.

Fraud is an act that aims to deceive others in a dishonest or fraudulent manner, with the aim of obtaining unlawful gain or advantage. There are various forms of fraud, including financial fraud, fake newspaper fraud, internet scams, identity theft, and many more.

Fraud can harm victims financially, emotionally, or even physically. Victims of fraud may lose money or property, as well as experience other losses such as loss of time and effort to recover the losses suffered. In addition, fraud can also cause stress, fear, and anxiety in victims.

Therefore, fraud is considered a harmful and unlawful act. The law in many countries regulates fraud and imposes severe sanctions on perpetrators of fraud.

In Indonesia, the elements of fraud are regulated in Article 378 of the Criminal Code (Criminal Code). This article states that a person can be considered to have committed a criminal act of fraud if the following elements are met:

• There is a misleading act or elimination of error regarding something important. The act
• is carried out with the intention of deceiving others.
• The deceived person hands over something of value (either in the form of money or goods) or promises to hand it over.
• The deceived person suffers material or immaterial losses. 

Thus, to be considered to have committed a criminal act of fraud in Indonesia, a person must commit an act that misleads or deceives another person, with the aim of obtaining profits or goods from the victim. In addition, the victim must suffer material or immaterial losses, such as loss of money, property, or a good reputation.

In Indonesia, the elements of theft regulated in the Criminal Code (KUHP) are as follows:

• There is an act of taking goods. This action can be in the form of taking goods directly, seizing or taking away the property of another person.
• The goods taken must belong to another person. The goods must be owned by another person who is not the perpetrator of the theft. If the perpetrator steals his own property, then the act cannot be considered theft.
• There is no permission or consent from the owner of the goods. The perpetrator of the theft does not have permission or consent from the owner of the goods taken.
• Intent to commit theft. The perpetrator must have the intent or purpose to take the property of another person without permission or consent.

If all four elements are met, then the act can be categorized as theft and will be punished in accordance with the applicable provisions in criminal law in Indonesia.

Although embezzlement, fraud, and theft have similarities in the act of taking or controlling something that does not belong to them, there are differences between these three types of crimes in Indonesian law. Here is an explanation of the differences between the three:

1. Embezzlement: Embezzlement occurs when a person holds or controls goods that should be handed over to another person or used together with another person, but is then used for personal gain without the permission of the owner or the person entitled to it. The difference between embezzlement and theft is at the time of taking the goods. If in theft the goods are taken directly from the owner, while in embezzlement the perpetrator holds or controls the goods with a legitimate right, but is then used for personal gain without the permission of the owner.
2. Fraud: Fraud occurs when a person commits trickery or deception with the intention of obtaining profits or advantages for himself or another person. The perpetrator of fraud uses various tricks or modus operandi that deceive the victim so that the victim suffers losses. The difference between fraud and theft is at the time the perpetrator takes the goods. If in theft the goods are taken directly, while in fraud the perpetrator deceives the victim into giving goods or money to the perpetrator.
3. Theft: Theft occurs when a person takes or controls the property of another person without the permission or consent of the owner. The perpetrator of the theft takes the goods directly, seizes or takes away the property of another person without permission or consent. The difference between theft and embezzlement and fraud is at the time the perpetrator takes the property of another person directly without the permission or consent of the owner.

In general, the three crimes are punished with legal action and there are differences in the level of crime and punishment imposed depending on the elements present in each case.

In the case in question, the act of a trusted employee selling office inventory cars without the permission or consent of the owner can be categorized as embezzlement, because the perpetrator holds or controls the goods with a legitimate right, but then sells them for personal gain without the permission or consent of the owner.

As an entrepreneur, you have the right to report the actions of your trusted employee to the authorities and to take legal action in accordance with the provisions applicable in criminal law in Indonesia. Perpetrators of embezzlement can be subject to criminal sanctions in the form of imprisonment for a maximum of 4 years or a maximum fine of Rp 900,000 (Article 372 of the Criminal Code). In addition, you can also file a claim for compensation for material losses arising from the employee's actions.

Disclaimer

All information and data available on Literasi Hukum are general in nature and provided for educational purposes only. Therefore, such information cannot be considered legal advice and cannot be used as evidence in judicial proceedings, including in courts, arbitration institutions, or industrial relations court proceedings.