What Is Breach of Trust With Fraudulent Intent?

Breach of trust with fraudulent intent is South Carolina’s name for what most states call embezzlement: taking or misusing property that someone lawfully entrusted to you, with the deliberate purpose of depriving them of it. The South Carolina Supreme Court has described the offense as “peculiar to this jurisdiction,” though the underlying conduct is prosecuted elsewhere as embezzlement or larceny by a bailee.¹ South Carolina law treats it as a form of larceny, and penalties scale with the dollar amount involved — from a misdemeanor punishable by up to 30 days in jail for $2,000 or less, to a felony carrying up to ten years in prison when the amount reaches $10,000 or more.²

What the State Has to Prove

The statute itself does not list elements. South Carolina courts have supplied them through case law, and a conviction requires proof beyond a reasonable doubt of four things:

The defendant had lawful possession of the property. Unlike ordinary theft, the property was not stolen at the outset.
The owner or the owner’s representative entrusted that property to the defendant, expecting it would be managed, returned, or used properly.
The defendant converted the property — took it or redirected it for personal use instead of the purpose it was entrusted for.
The defendant acted with intent to permanently deprive the owner, not through a temporary use or an honest mistake.

If the state fails on any one of these, the defendant should be acquitted. Courts have directed verdicts of not guilty when the prosecution could not establish the trust relationship at the threshold.¹

Why the Trust Relationship Matters

The heart of this crime is betrayal. South Carolina courts define a trust, for these purposes, as an arrangement where property is transferred with the intention that the recipient will manage it for the transferor’s benefit rather than for their own.¹ That is what separates this charge from ordinary theft: the owner voluntarily gave the defendant access, and the defendant exploited it.

The trust does not need to be a formal written document. It can arise from any situation where one person relies on another to handle property responsibly. An employee who manages cash deposits, a business partner entrusted with inventory, an agent handling financial transactions, a caretaker given access to someone’s belongings — each of these can be a basis for the charge. The question is whether the owner intended the defendant to act on the owner’s behalf rather than the defendant’s own.

This matters practically because it limits how far the charge reaches. If two parties had an arms-length transaction with no ongoing relationship of confidence, a dishonest act might be fraud or theft, but it is not breach of trust. The confided position has to exist before the property changes hands.

Proving Fraudulent Intent

Breach of trust with fraudulent intent is a specific-intent crime. The state cannot simply show that something went wrong with the property. It has to show the defendant acted with a deliberate, dishonest purpose. An accidental loss, a bad business decision, or sloppy bookkeeping does not meet the standard, even if the victim loses money.

Because direct evidence of what someone was thinking is rare, prosecutors build these cases on circumstantial proof. Patterns that courts and juries find persuasive include repeated unauthorized transfers, falsified records that concealed the activity, entrusted funds spent on personal expenses, lies to the victim about where the property stood, and the absence of any plausible innocent explanation. A single suspicious transaction is harder to prosecute than a pattern of conduct that only makes sense if the defendant intended to keep what was not theirs.

The reasonable-doubt standard applies to intent as much as to any other element. If the evidence leaves open a genuine possibility that the defendant believed they were entitled to the property or made an honest mistake, the conviction should not stand.

Penalties by Dollar Amount

South Carolina ties the punishment directly to the value of the misappropriated property. The statute creates three tiers:²

$2,000 or less is a misdemeanor punishable by up to a $1,000 fine, up to 30 days in jail, or both.
More than $2,000 but less than $10,000 is a felony carrying a discretionary fine, up to five years in prison, or both.
$10,000 or more is a felony carrying a discretionary fine, up to ten years in prison, or both.

The same penalties apply to anyone who hires or counsels another person to commit the offense. You do not have to personally handle the entrusted property to face the full charge; orchestrating or encouraging someone else carries the same exposure.²

South Carolina has no criminal statute of limitations. A breach committed years ago can still be prosecuted if the evidence supports it.

Restitution and Professional Fallout

A conviction triggers a mandatory restitution hearing. When a crime causes financial loss, South Carolina courts have to determine what the defendant owes the victim and order payment as part of the sentence, unless the defendant agrees to the amount in open court.³ Restitution is separate from any criminal fine. Its purpose is to make the victim whole.

A felony conviction also carries consequences that outlast the sentence. Accountants, financial advisors, attorneys, real estate agents, and others who hold professional licenses risk suspension or revocation. A felony record creates obstacles to employment, especially in roles involving financial responsibility, which is often exactly the kind of work defendants in these cases held before arrest. South Carolina law lets people with records challenge blanket employment disqualifications by showing rehabilitation, but the practical effect of a fraud-related felony on a career is severe.

Civil Liability on a Separate Track

The criminal case is not the only legal exposure. The victim can file a civil lawsuit for breach of fiduciary duty, which proceeds independently and uses a lower burden of proof. The plaintiff only has to show the breach was more likely than not, rather than proving it beyond a reasonable doubt.

Civil remedies can include compensatory damages for the actual loss, punitive damages in cases involving fraud or malice, and in some circumstances attorney fees. For licensed professionals, a civil judgment can also prompt regulatory action from licensing boards. The civil statute of limitations for breach of fiduciary duty in South Carolina is three years from the date of the breach, which matters even though the criminal side has no deadline.

Because the two tracks are independent, a defendant can be acquitted of the criminal charge and still lose the civil case, since the civil case only requires preponderance of the evidence. Victims often pursue both at once.

Common Defenses

Because the statute requires specific intent, the strongest defenses attack the state’s ability to show dishonest purpose. A few come up repeatedly:

No trust relationship existed. If the defendant did not hold the property in a position of trust, the charge fails at the threshold. This argument tends to be strong in arms-length business disputes where neither side was acting in a fiduciary capacity.
Claim of right. A defendant who honestly believed they had a legal right to the property lacks the fraudulent intent the statute requires. The belief does not have to be correct, but it has to be genuine. Transparency helps; someone who openly took property and recorded the transaction is more credible than someone who hid it.
Authorization. If the owner gave permission to use or dispose of the property the way the defendant did, there is no breach. Written agreements, emails, or witness testimony showing consent can defeat the charge.
Mistake of fact. An honest, reasonable misunderstanding about the property or the terms of the arrangement can negate intent. A defendant who genuinely believed they were handling surplus inventory they were allowed to sell has a mistake defense that undercuts fraudulent purpose.

Defendants also sometimes argue that the dispute is really a civil contract disagreement being prosecuted as a crime. Most of the gray area in these cases lives there. A business partner who takes more than their share of profits is behaving badly, but whether that behavior crosses from civil wrong to criminal act depends on whether the evidence shows genuine dishonest intent rather than a disagreement about who was owed what.

How It Differs From Theft and Embezzlement

The South Carolina Supreme Court has acknowledged that breach of trust with fraudulent intent covers the same ground other states address through embezzlement statutes.¹ The practical difference between this charge and ordinary theft is the defendant’s relationship to the victim. A stranger who takes cash from a register commits larceny. An employee who was entrusted with the day’s receipts and pockets them commits breach of trust. That betrayal of confidence is the distinguishing feature, and it is often the reason judges and juries treat these cases seriously even when the dollar amounts are modest.

1
South Carolina Judicial Branch. State v. Parris – 25965
2
South Carolina Legislature. South Carolina Code 16-13-230 – Breach of Trust With Fraudulent Intent
3
South Carolina Legislature. South Carolina Code 17-25-322 – Restitution to Crime Victims