Misappropriates

Misappropriates is the third-person singular form of misappropriate. It refers to the act of wrongfully taking or using property or funds entrusted to someone for purposes not authorized by the owner or by the terms of a contract or fiduciary duty.

In legal contexts, misappropriation is a form of fraud or theft arising from a breach of fiduciary duty. The specific elements vary by jurisdiction but typically include ownership of the property by another, custody by the accused, conversion or unauthorized use, and intent to deprive the owner.

Common examples include an employee diverting company funds to a personal account, a public official siphoning public money, or a nonprofit manager using donated resources for personal expenses.

Penalties range from civil liability and restitution to criminal penalties such as fines or imprisonment, depending on severity and local law. Prevention emphasizes internal controls: separation of duties, proper authorization, regular audits, robust accounting, and clear rules about the use of entrusted assets. Whistleblower protections and responsive enforcement also help deter misappropriation.

Misappropriation is often distinguished from misallocation or legitimate expenses, and discussions in accounting and law emphasize fiduciary responsibility and proper governance to prevent such acts.