The unauthorized use of money—whether through misappropriation, conversion, diversion, or any act of disposing of funds entrusted to a person without authority—constitutes one of the most frequently prosecuted economic crimes in the Philippines. These acts are primarily penalized under the Revised Penal Code (RPC), Presidential Decrees, and special laws, with the specific crime charged depending on the circumstances of the entrustment, the presence of deceit or abuse of confidence, the status of the offender (private individual or public officer), and the amount involved.

1. Estafa Through Misappropriation or Conversion (Article 315, paragraph 1(b), Revised Penal Code)

This is the primary and most commonly used provision for unauthorized use of money by private individuals.

Elements (as consistently ruled by the Supreme Court):

That money, goods, or other personal property is received by the offender in trust, on commission, for administration, or under any other obligation involving the duty to make delivery of, or to return, the same;
That there be misappropriation or conversion of such money or property by the offender, or denial on his part of such receipt;
That such misappropriation or conversion or denial is to the prejudice of another; and
That there is a demand made by the offended party (jurisprudence holds that demand is not necessary when there is evidence of misappropriation; it is merely corroborative).

Key Jurisprudential Doctrines:

Mere failure to return the money is not estafa if there was no criminal intent at the time of receipt (Gamboa v. CA, 1975).
The obligation must be contractual or quasi-contractual; purely moral obligations do not give rise to estafa.
Abuse of confidence is inherent in paragraph 1(b); it need not be separately alleged (People v. Menil, G.R. No. 115054-66, September 12, 2000).
Unauthorized deposit of entrusted funds to the offender’s personal account is already prima facie evidence of conversion (Chua-Burce v. CA, G.R. No. 109595, April 27, 2000).
Novation of the obligation (e.g., converting the obligation into a loan) is a valid defense only if done with the consent of the offended party before the filing of the criminal case (People v. Benemerito, G.R. No. 120389, November 21, 1996).

Penalties (as amended by R.A. 10951):

Amount Involved	Penalty
≤ P40,000	Arresto mayor in its medium and maximum periods
> P40,000 but ≤ P1,200,000	Prisión correccional maximum to prisión mayor minimum (with incremental penalty)
> P1,200,000 but ≤ P2,800,000	Prisión mayor maximum to reclusión temporal minimum
> P2,800,000 but ≤ P8,000,000	Reclusión temporal medium and maximum
> P8,000,000	Reclusión perpetua

Additional penalty: 1 year for each additional P2,000,000, but total shall not exceed 40 years.

2. Qualified Theft (Articles 308, 310, Revised Penal Code)

When the money is taken without consent but with grave abuse of confidence (e.g., domestic servant, employee who has access to employer’s funds, bank teller), the crime may be qualified theft instead of estafa.

Distinction Between Estafa and Qualified Theft (Libres v. CA, G.R. No. 128174, December 16, 1999):

Factor	Estafa (Misappropriation)	Qualified Theft
Consent in initial possession	With consent (juridical possession)	Without consent (material possession only)
Nature of possession	Offender has juridical possession	Offender has only material/physical possession
Typical relationship	Agent, bailee, administrator, trustee	Employee, driver, helper, cashier
Example	Agent instructed to deposit money but uses it for personal purpose	Cashier pockets money from cash register without authority

The Supreme Court has repeatedly ruled that when possession is juridical (i.e., there is a duty to return or deliver), the crime is estafa; when possession is merely material, it is theft.

3. Malversation of Public Funds or Property (Article 217, Revised Penal Code)

Applicable exclusively to accountable public officers.

Four Modalities:

Appropriation
Taking or misappropriation
Permitting another to take (through abandonment or negligence)
Technical malversation (illegal use of public funds for another public purpose, Art. 220)

Elements (common to all):

Offender is a public officer
Has custody or control of funds/property by reason of duties
Funds/property are public in character
Damage or prejudice to public interest (not necessary in some modalities)

Penalty is similar to estafa but based on the value, with perpetual special disqualification.

Private individuals may be held liable as principals if in conspiracy with the public officer (Art. 222).

4. Violation of the Trust Receipts Law (P.D. No. 115)

Failure to turn over proceeds of sale or to return the goods if unsold under a trust receipt agreement constitutes estafa punishable under Article 315(1)(b) RPC with the penalty one degree higher (Ng v. People, G.R. No. 173905, April 23, 2010).

The entrustee acquires only juridical possession; ownership remains with the bank/entuster.

5. Syndicated Estafa (P.D. No. 1689)

When five (5) or more persons conspire to commit estafa through investment scams, pyramid schemes, or similar schemes, the penalty is life imprisonment to death (now reclusión perpetua).

Most investment scams (e.g., Kapa Community Ministry, Aman Futures, Multitel, etc.) are prosecuted under this decree when syndicated.

6. Estafa Through False Pretenses (Article 315, paragraph 2(a) and (d), RPC)

Paragraph 2(a): Postdating or issuing a check as payment for a simultaneous obligation knowing there are insufficient funds (overlaps with B.P. 22 but constitutes estafa if deceit is present).
Paragraph 2(d): Issuing unfunded checks in payment of a pre-existing obligation (pure estafa, not B.P. 22).

7. Special Penal Laws Involving Unauthorized Use of Funds

Law	Offense Description	Penalty
R.A. No. 8484 (Access Devices Regulation Act)	Unauthorized use of credit cards, debit cards, or other access devices	6–20 years + fine
R.A. No. 10175 (Cybercrime Prevention Act)	Computer-related fraud, including unauthorized transfer of funds via hacking	One degree higher than underlying offense
R.A. No. 9160 (Anti-Money Laundering Act, as amended)	Money laundering involving unlawful activity (including estafa)	7–20 years + fine
R.A. No. 12010 (Anti-Financial Account Scamming Act of 2024)	Unauthorized electronic transfers, social engineering, money mule recruitment	Prisión mayor to reclusión temporal
B.P. Blg. 22 (Bouncing Checks Law)	Issuing checks without sufficient funds (administrative presumption of deceit)	Fine or imprisonment up to 1 year

8. Procedural and Prescriptive Aspects

Prescription of the crime:
- Ordinary estafa: 15 years if penalty is reclusión temporal or higher; 10 years if prisión mayor; 5 years if prisión correccional.
- B.P. 22: 4 years
- Malversation: same as estafa
Jurisdiction: Sandiganbayan if public officer and damage ≥ P50 million or involves constitutional commissions; otherwise RTC.
Civil liability: Always accompanies the criminal case; actual damages plus interest (currently 6% per annum from finality until full payment).

9. Common Defenses

Good faith/novation with consent
Payment or restitution before filing of information (extinguishes criminal liability in some jurisprudence if full and with consent)
Lack of juridical possession
Civil, not criminal, obligation
Desistance by complainant (does not extinguish liability except in private crimes)

Conclusion

Unauthorized use of money remains the lifeblood of most economic sabotage and white-collar crime prosecutions in the Philippines. The choice between estafa, qualified theft, malversation, or special law violations depends heavily on the nature of possession and the relationship between the parties. Prosecutors and courts continue to apply the long-standing rule: if juridical possession was transferred with a duty to return or deliver, the crime is estafa; if only material possession was given, it is theft. With the enactment of R.A. 12010 in 2024, electronic and social-engineering-related unauthorized transfers now carry even heavier penalties, reflecting the evolving nature of financial crime in the digital age.