United States of America v Dwayne Lequire

One cannot be guilty of embezzlement if the alleged victim did not own the funds that were supposedly embezzled. In this case, an insurance agency had a contract with an insurance company that allowed the agency to commingle collected insurance premiums with its other funds in its general operating account. The contract also obligated the agency to remit the total amount of premiums due the company each month, whether or not the agency had collected the premiums. Furthermore, if the agency were delinquent in the amount it was to remit to the company, interest would accrue monthly on the unpaid balance. The government contends that the premiums collected by the agency were the property of the insurance company and held “in trust” by the agency; it alleges that when the funds were not remitted but used for other purposes, they were embezzled by the agency’s treasurer, defendant Dwayne Lequire.

We hold today that under long-standing Arizona law, the contract between the agency and the company, which permitted agency commingling, required monthly agency payments whether premiums were collected or not, and created a right to interest on late payments, created a…