Filing Qualified Theft Against an Agent for Fund Misappropriation (Philippines)

This guide walks you through the substance and procedure of bringing a qualified theft case against an agent who misappropriated funds in the Philippines. It’s written for business owners, managers, and counsel who need a practical, end-to-end reference.

1) The Legal Theory at a Glance

Theft vs. Qualified Theft

Theft (Revised Penal Code, “RPC,” Art. 308–309) punishes taking personal property of another with intent to gain, without the owner’s consent, and without violence or intimidation.
Qualified theft (RPC Art. 310) is theft attended by qualifying circumstances, notably:
- committed with grave abuse of confidence (typical for insiders, e.g., employees, agents, cashiers, treasurers);
- or involving certain special properties/situations (e.g., motor vehicles, mail matters, large cattle, coconuts/fish from plantations/ponds, or on the occasion of calamity).
Penalty uplift: Qualified theft is punished two degrees higher than the penalty for simple theft based on the value of the property (see §4 below). This is why choosing the correct charge matters.

Theft vs. Estafa (Misappropriation)

Misappropriation by an agent often raises the classic question: Is it theft or estafa? The distinction typically turns on possession:

Qualified theft applies when the offender had only material/physical possession (custody) and converted the funds—because juridical possession remained with the principal/employer. Common examples: tellers, cashiers, collectors whose possession is purely for delivery or safekeeping.
Estafa (RPC Art. 315(1)(b)) applies when the offender received the money in trust/commission/administration with juridical possession—i.e., legal authority to deal with it under the agency—and then misappropriated or converted it. This is frequent with independent agents who can bind the principal and carry their own risk of loss.

Practical test: Ask who bears the legal possession/risk over the money once the agent receives it. If the law treats the principal as still in possession (agent is just a custodian), qualified theft tends to be proper. If the agent receives the funds with independent authority to administer or deliver according to the agency, estafa is usually correct.

Choosing the wrong charge can lead to acquittal. When in doubt, align allegations and evidence with the possession theory that fits your facts.

2) Elements You Must Prove (Qualified Theft via Abuse of Confidence)

There was taking (apoderamiento) of personal property (money is “personal property”).
The property belonged to another (e.g., your company).
The taking was without the owner’s consent (or beyond/against authority).
There was intent to gain (animus lucrandi)—often inferred from misappropriation, concealment, or failure to return despite demand.
The taking was committed with grave abuse of confidence—the offender used a trusted position/relationship (employee/agent/insider) to facilitate the taking.

Notes:

“Taking” can be a conversion of funds already in the offender’s mere physical custody—not necessarily a snatch or stealth act.
Demand is not an element of theft, but written demand and non-compliance are powerful evidence of intent to gain and conversion.

3) Building Your Case: Evidence Checklist

A. Relationship & Authority (to show abuse of confidence)

Written agency/employment contract, job description, internal policies (cash handling, remittance).
Board resolutions, special powers of attorney, or delegations showing scope/limits of authority.
Organizational charts, emails, and memos establishing trust reposed in the agent.

B. Ownership & Possession

Proof the funds belonged to you (sales records, invoices, remittance schedules, client payment confirmations).
Cash logs, collection receipts, ORs, deposit slips, and cash count sheets.
Audit reports with schedules of shortages, variance analyses, and reconciliation workpapers.

C. The Taking / Conversion

Bank statements (company and, if available via subpoena, the agent’s accounts), fund flow mapping, and unposted deposits reports.
Transaction trails (POS exports, ERP/accounting ledgers, e-wallet dashboard exports, spreadsheet control sheets).
CCTV, access logs, device logs, and email/chat admissions.
Demand letter (serve via courier with tracking, or personally with receiving copy) + proof of non-payment.

D. Valuation (drives the penalty)

Clear computation of loss by date, source, and amount, with supporting vouchers.
Affidavits of accountants/auditors, cash officers, and clients whose payments were diverted.

E. Chain of Custody & Authenticity

Authenticate electronic records (hash values, export metadata, custodian certificates).
Keep originals; label exhibits; maintain an evidence register.

4) Penalties and Civil Liability

Criminal Penalty

Theft penalties under Art. 309 are value-based (brackets updated by RA 10951).
Qualified theft (Art. 310) imposes the penalty two degrees higher than the corresponding Art. 309 penalty for the same amount.
Depending on the amount, the resulting penalty can reach afflictive levels; in extreme valuations, it may approach penalties where bail becomes discretionary (see §8).

Practice tip: In the complaint and Information, allege the total value and attach your valuation schedule; prosecutors/judges rely on this to determine the proper penalty range.

Civil Liability (Ex Delicto)

Filing a criminal case automatically includes the claim for civil liability (restitution, actual damages, interest) unless you waive or reserve it. Standard practice is to pursue civil liability within the criminal case to streamline recovery.

Restitution/Actual damages: The exact amount taken, proven by competent evidence.
Legal interest: Philippine courts commonly impose 6% per annum legal interest on monetary awards from date of default (often the date of demand or when the obligation became due) until full payment.
Moral/exemplary damages may be available when bad faith or wanton conduct is shown.

5) Where and When to File

Venue & Jurisdiction

File where any essential element occurred: where the funds were taken/received, where the business is located, where the conversion occurred, or where the loss was discovered if tied to a material act there.
Court level depends on the imposable penalty (which turns on the amount). Prosecutors will route the case to the proper court once an Information is filed.

Prescription (Time Limits)

Crimes under the RPC prescribe based on the penalty (higher penalties → longer prescription).
Practical guidance: Do not delay. The filing of a complaint with the prosecutor interrupts prescription. Early filing preserves your rights even while you complete audits.

6) The Filing Process (Step-by-Step)

Internal Audit & Case Theory
- Finalize a loss schedule with working papers and source docs.
- Decide on qualified theft vs. estafa based on possession theory (see §1). You can plead in the alternative in the complaint, but the Information will ultimately charge one.
Prepare Sworn Statements
- Affidavit-complaint of the authorized company officer (attach board authority/SPA).
- Affidavits of cashiers, collectors, clients, and accounting/audit personnel.
- Attach documentary annexes (paginate, label: Annex “A,” “B,” …).
Demand Letter (Optional but Strategic)
- Send written demand for immediate return; set a clear deadline.
- This is evidence of intent to gain and triggers default (for interest).
File with the Office of the City/Provincial Prosecutor
- Submit the affidavit-complaint and annexes.
- There are generally no filing fees for criminal complaints with the prosecutor.
- The prosecutor issues subpoena for counter-affidavits; expect clarificatory hearings if needed.
Resolution & Information
- If probable cause is found for qualified theft, the prosecutor files an Information in the appropriate court.
- The court will issue a warrant of arrest or summons depending on the penalty/evidence submitted.
Arrest/Bail/Arraignment
- After arrest (or voluntary surrender), bail may be posted depending on the imposable penalty and strength of evidence.
- Arraignment, pre-trial, then trial follows.
Provisional Remedies (Parallel Civil Recovery)
- File a separate civil action (or reserve it) if you want pre-judgment attachment (Rule 57) to freeze assets of the agent at the outset.
- Alternatively, seek writs of replevin/attachment where appropriate and coordinate with bank subpoenas once the criminal case advances.
Judgment & Enforcement
- Upon conviction, the court awards restitution/damages and interest.
- Enforce via writs of execution, garnishment, and levy on properties.

7) Bail and Detention: What to Expect

As a rule, offenses are bailable before conviction except those punishable by reclusion perpetua/life imprisonment/death when the evidence of guilt is strong.
In high-value qualified theft, the uplifted penalty can approach those ranges. The court will weigh the Information, affidavits, and exhibits to determine bail entitlement and amount.
Even when bailable as a matter of right, courts may set substantial bail guided by the Supreme Court’s bail schedules and the circumstances of flight risk and means of the accused.

8) Common Defenses and How to Overcome Them

“It’s Estafa, not Theft.” → Fortify your possession theory (show mere custody by the agent, with juridical possession retained by the company). Highlight policies requiring immediate remittance, no authority to commingle, and controls (e.g., dual signatories).
Authority / Consent. → Show the act was beyond delegated authority (limits in the agency letter; requirement to deposit daily; prohibition from using funds to “cover” shortages).
Accounting Error / No Intent to Gain. → Use reconciliations, variance analyses, and document trails to show a pattern consistent with diversion, not mere mistake.
Payment / Restitution after Demand. → Restitution does not extinguish criminal liability but may mitigate civil liability or penalty. Document timelines to show criminal act was complete upon conversion.

9) Drafting Tips (Affidavit-Complaint & Information-Ready Allegations)

Plead specific dates, amounts, transactions, and modes of taking (e.g., withholding cash collections; diverting client deposits; pocketing cash sales; failing to remit e-wallet receipts).
Allege the qualifying circumstance: grave abuse of confidence (identify the position, trust reposed, and how it was betrayed).
Attach a valuation table (Date • Source/Client • Amount • Evidence Ref • Running Total).
Include annex maps:
- Annex “A”—Agency/Employment docs
- Annex “B”—Policies/Manual extracts
- Annex “C”—Audit schedule & reconciliation
- Annex “D”—Demand letter + proof of service
- Annex “E”—Bank statements / deposit proofs
- Annex “F”—Affidavits of key witnesses

10) Parallel and Ancillary Actions

Corporate/Administrative measures: Termination for cause; notice to insurers (fidelity/crime policies); reports to regulators if client funds are implicated.
Asset protection: Independent civil action for injunction/attachment; consider third-party liability (co-conspirators, recipients of diverted funds with bad faith).
Immigration coordination: For serious cases with high penalties, counsel sometimes seeks immigration lookout measures through DOJ/BI channels (subject to prevailing rules and court orders).

11) Practical Strategy & Ethics

Speed + Completeness. Early filing interrupts prescription and increases leverage, but do not file bare. Submit a cohesive audit packet.
Consistency. Keep your theory (theft vs. estafa) consistent across demand letters, affidavits, and pleadings.
Data hygiene. Preserve logs and devices; avoid spoliation. Use forensic images for electronic evidence.
Fairness. Avoid criminalization of purely civil collection disputes; ensure evidence supports intent to gain and conversion, not just non-payment.

12) Quick Reference: What Prosecutors Look For

Clear narrative of trust → abuse of confidence.
Solid paper trail proving ownership, receipt, and failure to remit.
Valuation schedule consistent with annexes.
Demand and non-compliance supporting intent.
Correct legal framing (qualified theft vs. estafa) anchored on possession.

13) Sample Outline: Affidavit-Complaint (Skeleton)

Parties & Authority (position, board authority/SPA)
Background (role of agent, duties, trust reposed)
Controls & Policies (remittance rules, custody limits)
Facts of Taking (dates, amounts, mechanisms, concealment)
Audit Findings (tables + annex references)
Demand & Default (date served; no restitution)
Legal Basis (RPC Arts. 308–310; qualified circumstance: abuse of confidence)
Prayer (criminal prosecution; damages/restoration with interest; issuance of subpoena; other reliefs)

Final Notes

Qualified theft is a potent remedy for insider misappropriation when juridical possession never left the principal.
If juridical possession did pass to the agent, pivot to estafa under Art. 315(1)(b), or plead in the alternative at the complaint stage and let the prosecutor determine the proper charge after evaluation.
Work closely with counsel to align your evidence matrix, valuation, and legal theory—these three win (or lose) qualified theft cases.