Construction loans are intended to pay for:
- Services
- Labor
- Materials
- Equipment
Individuals in the construction industry often require large sums of money to accomplish their work. Unfortunately, sometimes these loans are misappropriated. Individuals who misuse these funds can be charged under California Penal Code Section 484b: Diversion of Construction Loans.
A violation of PC 484b can lead to harsh legal penalties, including fines and jail time. You can find out more about the definition of this criminal act and possible defenses from the legal professionals at the Simmrin Law Group.
Diversion of Construction Loans: Definition
PC 484b allows the court system in Los Angeles to prosecute individuals who:
- Receive Money for Construction Purposes
- Fail to Use the Money for its Intended Purpose
- Divert and Use the Money for Some Other Purpose
The court system considers any misuse of the funds from a construction loan to a be a violation of PC 484b.
Diversion of Construction Loans: Similar Charges
Individuals charged with the diversion of construction loans are accused of committing a type of theft. There are several other prominent charges used in Los Angeles to prosecute acts of theft, including:
- California Penal Code Section 484(a) & 488: Petty Theft
- California Penal Code Section 487: Grand Theft
- California Penal Code Section 459: Burglary
- California Penal Code Section 211: Robbery
These severe charges can change the course of your life forever if you are convicted in the court of law.
Diversion of Construction Loans: Examples
Identifying examples of PC 484b violations can make it easier to understand this charge:
Person A buys some land that he intends to develop. He comes up with a plan and gets a loan to begin construction. He then becomes incredibly ill and takes the money from the loan to pay for expensive medical treatment, thereby violated PC 484b.
Person B is hired by a business owner to upgrade an older building. The business owner provides Person B with money to work on the project. Person B uses up the money quickly and leaves the job unfinished. The portions that are completed do not meet the business owner’s expectations. However, Person B did not violate PC 484b, as the funds were not used for anything besides construction.
Diversion of Construction Loans: Defenses
Individuals charged under PC 484b can face difficult a challenge when it comes to building a defense. In order to beat a diversion of construction loans charge, a criminal defense lawyer in Los Angeles will need to prove that you did not unlawfully use or misspend any funds.
Note that you should not be convicted under PC 484b if you:
- Were Unable to Finish a Job Due to Debt
- Did Not Do Acceptable Construction Work
In these cases, no criminal action has occurred, though a property owner may still be able to seek compensation through a civil case.
Diversion of Construction Loans: Repercussions
There are a number of serious penalties if you are convicted of diversion of construction loans. These charges may be treated differently based on the value of the loan:
Loans Worth Under $2,350
Diversion of a construction loan worth under $2,350 is considered a misdemeanor in Los Angeles. You could face 6 months of jail time if convicted of this act. Additionally, you would have to offer restitution to the victim of the loan diversion.
Loans Worth Over $2,350
Individuals who divert a construction loan worth more than $2,350 may be charged with a misdemeanor or a felony. The decision to proceed with the charges as a misdemeanor or a felony typically depends on:
- The Defendant’s Criminal History
- The Amount of Money Diverted
A conviction for a misdemeanor typically leads to 1 year of jail time. Felony convictions can result in 3 years of prison time. Either conviction requires the defendant to repay the money diverted from the construction loan.
Diversion of Construction Loans: Getting Help
You do not have to fight charges for California Penal Code Section 484b: Diversion of Construction Loans on your own. Get help from the Simmrin Law Group today by calling (310) 997- 4688 or completing our online contact form.
Call today to take advantage of a FREE initial case evaluation.