Legal Question in Business Law in California

Re: Employee Fraud

Try fraud.org or acfe.com

Re: Employee Fraud

This is a very broad topic, partly because employee misconduct, misfeasance, malfeasance, whetever you call it, may fall into one or more of several legally-recognized categories, including actual fraud, constructive fraud, embezzlement, breach of fiduciary duty, and negligence to name a few.

You might start with the statutory definitions of fraud in the Civil Code (sections 1572 and 1573) and deceit (CC 1709, 1710).

If the issue may involve embezzlement, try Penal Code 503 et seq. Try to find annotated versions of the codes so you can find cases analyzing and dissecting the words of the statutes and applying the law to specific facts.

The fiduciary duties of officers and directors would be researchable under the general topic heading "business judgment rule" which tries to pin down the dividing line between blameless bad luck and mismanagement when things go wrong. This subject would, however, mainly apply to top-level decisionmakers and policymakers and not middle management.

Remember also that the term "illegal" is usually thought of by lawyers to apply to acts that are punishable by criminal prosecution or administrative action of some kind, and many wrongs are "actionable" in that you can sue regarding them without being "illegal" in one sense of that word. The higher up in a business organization someone is, the more likely that his or her immoral acts will be actionable. The main requisite for suit for most of the civil wrongs mentioned above usually is the breach of some kind of duty, with resulting harm to the plaintiff. Construe the term "duty" broadly.