Many white collar crime prosecutions in the Houston area revolve around fraud. In some cases, a civil breach of contract may escalate into criminal theft if the state can prove a defendant acted with fraudulent intent. Under Section 31.03 of the Texas Penal Code, theft occurs when one person “unlawfully appropriates property” from another. An unlawful appropriation, in turn, may involve the defendant using “deception” to convince the victim to turn over their property.
Midland Contractor Sentenced to 5 Years After “Abandoning” Construction Project
Here is an illustration from a recent case in Midland, Texas. The district attorney charged a construction contractor with criminal theft after he failed to complete a house for one of his customers. According to the evidence presented at trial, the defendant received between $125,000 and $135,000 from the customer to build a 2,800-square-foot house. The defendant promised he would complete the house in just three months and for less than half of what similar construction in the area cost.
At one point, after the customer paid an additional $15,000 for materials, the defendant allegedly “abandoned the project” and said he “was working to get money to finish the house.” The customer then demanded $70,000 of his money back. The defendant agreed to this but never followed through.
The jury also heard testimony from several other customers “who had problems with” the defendant’s work. At least one of these other customers obtained a $138,000 default judgment against the defendant in a separate civil lawsuit. Two other customers said the defendant failed to either complete their respective jobs or deliver promised refunds.
The jury found the defendant guilty. A judge sentenced him to 5 years in jail and ordered him to pay the $70,000 he owed to the customer. On appeal, the defendant argued his “breach of contract does not amount to theft.” The appeals court disagreed. The prosecution produced evidence that the defendant never used the final $15,000 to purchase the promised building materials. Instead he “disappeared.” From this, the appeals court said “the jury could infer” that there was an intentional misappropriation of funds based on deception, i.e. theft.
In addition, this was just part of a long chain of evidence that demonstrated the defendant “intended to commit theft.” There was also the fact he “priced the home at less than 50 percent of the going market rate,” and his “unrealistic three-month time frame for completion of the project.” The jury was also allowed to consider the defendant’s prior problems with his other customers as proof of fraudulent intent.
Have You Been Accused of Criminal Fraud?
Of course, not every construction contractor is a criminal just because he or she misses a deadline or goes over budget. The burden is always on the prosecution to prove fraudulent intent beyond a reasonable doubt. And civil court is usually the proper forum for dealing with a dissatisfied customer who simply wants their money back.
But if you find yourself in a situation where a business dispute is under criminal investigation, you need to take the matter seriously. An experienced Houston white collar crimes lawyer can assist you with all types of fraud charges. Call the Law Offices of Tad Nelson & Associates at (281) 280-0100 if you need to speak with a qualified criminal defense attorney today.