A Minnesota Defense Attorney Explains Felony Charges Under Minn. Stat. § 609.445.
You were in a position of trust, handling money on behalf of a state, county, or local agency. It was a responsibility you took seriously. But now, that trust has been shattered by a criminal accusation, and your world has been turned upside down. You are facing a felony charge in Minnesota for Failure to Pay Over State Funds under statute § 609.445. This is, in essence, a charge of embezzlement—an allegation that you intentionally kept public money that you were supposed to turn over. Your name, your career, and your freedom are hanging by a thread.
Perhaps you’re the victim of a chaotic accounting system, where funds were misplaced and you are being set up to take the fall. Maybe a subordinate made a critical error, and now the blame is landing on your desk. It’s also possible that you found yourself in a moment of personal crisis—facing overwhelming debt, a family emergency, or health problems—and you made a terrible mistake, always intending to pay the money back. Whatever the circumstances, the prosecutor doesn’t care about your story. They see a public employee and missing funds, and they are building a felony case to make an example of you. As a criminal defense attorney with experience defending Minnesotans against serious financial crime charges across the state, from Minneapolis and St. Paul to Rochester and Duluth, I know that a charge is not a conviction. You do not have to face this fight alone.
What It Really Means to Fail to Pay Over State Funds
When you are charged with Failure to Pay Over State Funds, the government is accusing you of a specific type of theft. The law is aimed at public employees or agents who receive money on behalf of the government and then knowingly decide not to remit it to the proper authority. This is not about a simple bookkeeping error, a misplaced deposit slip, or a payment that was delayed due to bureaucratic red tape. The entire case hinges on the word “intentionally.” A prosecutor must prove that your failure to pay was a conscious choice—a deliberate refusal or omission to do your duty, which implies you intended to keep the money for yourself or use it for a purpose other than the public’s.
A Minnesota charge for failing to pay state funds can arise in countless scenarios. It could be a clerk at a DMV in Bloomington who pockets cash payments, a county fee collector in St. Cloud who “borrows” from their deposits, or a manager of a state-funded program in Eagan who diverts grant money. The core of a § 609.445 accusation is that you lawfully received public money but then unlawfully and intentionally kept it. Understanding that the prosecutor’s entire case rests on proving your intent is the key to building a powerful defense.
The Law on Withholding State Funds — Straight from the Statute
The legal basis for the felony charge against you is found in a single, powerful paragraph in the Minnesota statutes: § 609.445. To effectively defend your rights, you must first understand the precise language the prosecutor will use to try and secure a conviction that could send you to prison.
Here is the full text of the statute:
609.445 FAILURE TO PAY OVER STATE FUNDS.
Whoever receives money on behalf of or for the account of the state or any of its agencies or subdivisions and intentionally refuses or omits to pay the same to the state or its agency or subdivision entitled thereto, or to an officer or agent authorized to receive the same, may be sentenced to imprisonment for not more than five years or to payment of a fine of not more than $10,000, or both.
Deconstructing the State’s Case: The Legal Elements of § 609.445
For the government to convict you of this crime, a prosecutor must prove every single component of the statute—the legal elements—beyond a reasonable doubt. My job as your defense attorney is to attack each element, creating doubt and showing a jury that the state’s evidence is not as strong as it seems. If we can show that even one element cannot be proven, the case against you must be dismissed.
- Receipt of Money for the State: The prosecution must first establish that you lawfully came into possession of money and that this money was received on behalf of or for the account of the state, a county, a city like Minneapolis or St. Paul, or any other government agency. This could include fees, fines, tax payments, or grant funds. We will scrutinize the nature of the funds to determine if they legally qualified as “state funds” at the moment you handled them.
- A Duty to Pay the Funds Over: The state has to prove that you had a clear and unambiguous legal duty to remit these specific funds to a particular government entity or an authorized officer. If the process for handling these funds was unclear, if there were no established procedures, or if the duty to pay belonged to someone else in your organization, we can argue that you cannot be held criminally liable for the failure.
- An Intentional Refusal or Omission: This is the most critical element and the heart of your defense. The prosecutor must prove that your failure to pay was not an accident, a mistake, a product of a messy accounting system, or a temporary delay. They must prove you intentionally—that is, consciously and with purpose—refused or omitted to make the payment. This implies a criminal state of mind, a decision to steal. Without proof of intent, there is no crime.
The Harsh Penalties for a Conviction: More Than Just Paying the Money Back
Make no mistake: a conviction for Failure to Pay Over State Funds is a life-altering event. This is a felony offense. The consequences go far beyond simply repaying the money you are accused of taking. A conviction is a brand that will follow you forever, carrying severe criminal penalties and destroying your professional life, your civil rights, and your future financial stability.
Felony Penalties for Withholding State Funds
If you are convicted of this felony in Minnesota, a judge can impose severe penalties, including:
- Up to 5 years in prison.
- A fine of up to $10,000.
- Both imprisonment and a fine.
In addition to these criminal penalties, you will be placed on supervised probation for years, and you will be ordered to pay full restitution for the amount of money the state claims was taken. Furthermore, as a convicted felon, you will lose fundamental civil rights, including the right to own a firearm and the right to vote until you are off paper. The penalties for a § 609.445 conviction are designed to be devastating, which is why you must mount an aggressive defense.
How These Charges Play Out in the Real World: Common Minnesota Scenarios
This type of charge can arise in any government position where an employee handles public money, from a high-level administrator to a front-line clerk. The allegations often begin with a routine audit or a complaint, which then spirals into a full-blown criminal investigation, catching even well-meaning people in its net.
Here are a few common scenarios of how a public employee in Minnesota could end up facing this serious felony charge:
The Minneapolis DMV Clerk
A long-serving clerk at a busy Minneapolis Driver and Vehicle Services office handles hundreds of cash transactions daily for license renewals and fees. Facing a mountain of personal debt, the clerk begins “skimming” small amounts of cash from the daily till, hoping it will go unnoticed in the high volume of transactions. They intentionally omit the cash from the daily deposit, intending to keep it. This is a classic example of intentionally refusing to pay over state funds.
The St. Paul Parks Department Manager
A manager for the St. Paul parks department is in charge of collecting cash rental fees for picnic shelters and event spaces. The accounting system is outdated and poorly managed. The manager, under financial stress, starts pocketing some of the cash payments and uses the confusing bookkeeping to hide the shortfalls. They know they have a duty to turn over all fees, but their intentional omission is a criminal act.
The Rochester County Contractor
A private company is contracted by Olmsted County to manage parking ramp revenue in downtown Rochester. The contract explicitly states that all revenue must be turned over to the county each month. The owner of the company intentionally manipulates the revenue reports, understating the income and keeping the difference. Even as a private contractor, they are acting as an agent for the county and can be charged under this statute.
The Duluth Local Agency Treasurer
An individual volunteers as the treasurer for a small, publicly-funded community arts agency in Duluth. The agency receives a state grant check. The treasurer deposits the check into their own bank account, telling the board the grant was denied. They intentionally omit the payment to the agency, knowing they are not authorized to keep the funds. This act of deception and omission is a clear violation of § 609.445.
Your Defense Starts Now: Strategies to Fight a State Funds Charge
When you are facing a felony charge for a financial crime, it is easy to feel hopeless. The state will come armed with auditors, spreadsheets, and a narrative that paints you as a thief. But their case is often not as solid as it appears. An experienced criminal defense attorney knows how to challenge the state’s evidence, question their interpretation of the facts, and expose the reasonable doubt that is often hidden within complex financial records.
Your defense begins with a deep dive into the facts of your case. We will conduct our own forensic review of the financial records, identify weaknesses in the state’s audit, and find evidence that supports your side of the story. The prosecutor has to prove you had criminal intent. Our job is to show a jury that your actions were the result of a mistake, confusion, or desperation—not a calculated plan to steal from the public. There are many powerful defenses to fight a Minnesota theft of state funds charge.
Arguing Lack of Criminal Intent
This is the most powerful defense in almost every financial crime case. The burden is on the prosecutor to prove what you were thinking. We will work to show your actions were not driven by a criminal purpose.
- No Intentional Refusal or Omission: We can argue that the failure to pay was not a conscious choice. Perhaps it was the result of a chaotic work environment, poor training on accounting procedures, or simple negligence. A mistake, even a costly one, is not the same as an intentional criminal act.
- Intent to Repay the Funds: In some cases, a person takes money during a personal crisis, fully intending to pay it back before the next audit. While not a perfect legal defense, evidence of your intent to repay can be used to argue that you did not have the specific intent to permanently deprive the state of its funds, which can be critical in negotiating a better outcome or persuading a jury.
Challenging the Factual and Accounting Evidence
The state’s case is built on numbers. We can fight back by showing their numbers are wrong or don’t tell the whole story.
- Hiring a Forensic Accountant: We can retain our own forensic accounting professional to conduct an independent audit of the records. These professionals are skilled at finding errors in the state’s analysis, identifying alternative explanations for missing funds, and showing how poor internal controls could have led to the discrepancy. This can create powerful reasonable doubt.
- Another Person is Responsible: In many workplaces, multiple people have access to cash drawers, accounts, and financial records. We can conduct an investigation to show that another employee had the opportunity and motive to take the funds and that you are being unfairly targeted as a scapegoat.
Attacking the Legal Elements of the Charge
We will scrutinize the law and the facts to show that your specific situation does not fit the crime.
- No Clear Duty to Pay: We can argue that your role did not include the clear, unambiguous legal duty to be the final person responsible for paying over the funds. If procedures were unclear or the responsibility was shared, it becomes much harder for the state to prove you are the one who is criminally liable.
- Funds Were Not “State Funds”: In complex arrangements involving grants, federal pass-through money, or public-private partnerships, there can be a legitimate legal dispute over whether the money you received legally constituted “state funds” at the time it was in your possession. If it wasn’t, you cannot be guilty of this specific crime.
Minnesota § 609.445 FAQs: Your Urgent Questions, Answered
Am I definitely going to prison if convicted of this felony?
While a prison sentence of up to five years is possible, it is not automatic, especially for a first-time offender. However, courts take theft from the public very seriously. An experienced attorney can argue for alternatives like probation, but the threat of prison is very real, making a strong defense essential.
Can I avoid a felony conviction by paying all the money back?
Paying restitution is crucial and will be required by the court, but it does not automatically erase a felony charge. However, having the ability to pay the money back immediately is your most powerful tool in negotiating with the prosecutor for a reduction of the charge, possibly to a misdemeanor or a gross misdemeanor, which would avoid a felony conviction.
Is this the same as embezzlement?
Yes, this statute is Minnesota’s version of an embezzlement law specifically applied to public funds. Embezzlement is the fraudulent taking of property (in this case, money) by someone to whom it was entrusted.
Why do I need a lawyer for a financial crime in St. Paul?
Financial crime cases are incredibly complex. They involve detailed records, expert witnesses like forensic accountants, and sophisticated legal arguments about intent. A prosecutor in Ramsey County will have dedicated resources to these cases. You need an attorney who can meet them at that level, not a general practitioner.
What if I was just “borrowing” the money and planned to pay it back?
This speaks to your intent. While it’s not a complete defense (you still took money you weren’t entitled to), your intent to repay can be a powerful argument against the specific intent to permanently deprive, which is often required for a theft conviction. It is a critical fact that we can use in negotiations.
How does the state prove I acted “intentionally”?
Prosecutors use circumstantial evidence. They will point to a pattern of conduct over time, attempts to conceal the missing funds (like altering records), or spending that corresponds with the missing money. Our job is to provide alternative, non-criminal explanations for that same evidence.
What if the accounting system at my job was a complete mess?
This is a strong defense point. If the internal controls and accounting procedures were chaotic, it becomes much more difficult for the state to prove beyond a reasonable doubt that money was stolen, rather than simply lost, miscounted, or misallocated due to a faulty system.
Will I lose my government pension if I am convicted?
A felony conviction for a crime related to your public employment will almost certainly result in the forfeiture of your public pension. This is a devastating collateral consequence that makes avoiding a felony conviction an absolute necessity.
What is the statute of limitations for this crime?
The statute of limitations for most felonies in Minnesota, including this one, is three years. This means the state must file a formal criminal complaint against you within three years from the date the offense was committed.
Can this felony charge ever be reduced to a lesser crime?
Yes. An experienced attorney’s primary goal, short of a full dismissal, is to negotiate a reduction of the charge. We can use weaknesses in the state’s case, your personal history, and your ability to pay restitution to persuade the prosecutor to reduce the felony to a gross misdemeanor or misdemeanor, saving your future.
What is the very first thing I should do if I am being investigated?
Say nothing. Exercise your right to remain silent and contact a criminal defense attorney immediately. Do not speak to auditors, investigators, or your supervisors about the details of the case. They are not on your side. Your only safe conversation is with your attorney.
What if my boss knew about it or even told me to do it?
This could be a defense, but it is a complicated one. If you were acting under duress or following a direct, coercive order from a superior, it could negate your criminal intent. However, you need an attorney to navigate this treacherous argument carefully.
Does this apply to money collected for a school fundraiser in Plymouth?
It can. If the fundraiser is for a public school in Plymouth, the money collected could be considered funds for a “subdivision” of the state. Any person entrusted with that money who intentionally keeps it could potentially be charged under this statute.
Can the state just take the money from my bank account?
No, they cannot simply seize your assets without a court order. However, as part of a conviction, a judge will order you to pay restitution, which is an enforceable court order. They can then use legal means like wage garnishment to collect if you do not pay voluntarily.
Will my spouse be held responsible for this?
Generally, no. Criminal liability is individual. Your spouse cannot be charged with your crime unless the prosecutor has evidence that they actively conspired with you or participated in the offense.
Life After a Conviction: The Permanent Consequences of a Felony
A felony conviction for Failure to Pay Over State Funds is a brand that will never wash away. It follows you for the rest of your life, closing doors and limiting your opportunities in ways you cannot yet imagine. The prison sentence or fine is temporary; the collateral consequences are permanent.
The Lifelong Ban on Firearm Ownership
As a convicted felon in Minnesota, you will be permanently stripped of your Second Amendment rights. You will never again be able to legally own or possess a firearm or ammunition for any reason, whether for hunting, sport, or personal protection. This is a lifetime ban.
A Career-Ending Criminal Record
A felony conviction for a crime of dishonesty like this is a “red flag” on any background check. You will be virtually unemployable in any field that requires a position of trust, handles finances, or requires a professional license. Your public service career will be over, and your prospects in the private sector will be severely damaged.
Loss of Housing, Loans, and Civil Rights
Felons face significant hurdles in everyday life. Many landlords will not rent to you. Banks may deny you loans for a car or a home. You will also lose your right to vote while you are incarcerated and on probation, and your right to serve on a jury. These are fundamental aspects of citizenship that will be taken from you.
Severe Immigration Consequences for Non-Citizens
If you are not a U.S. citizen, a conviction for this crime is catastrophic. It is considered a “crime involving moral turpitude,” which is an aggravated felony under immigration law. A conviction will lead to almost certain and permanent deportation from the United States, with no hope of return.
Why a Tough, Financial Crime Defense Attorney is Your Only Option
When you are accused of a complex financial crime, you cannot afford to have just any criminal defense lawyer. You need an attorney who understands the language of finance, who knows how to dissect an audit, and who can stand up to the state’s expert witnesses. The prosecutor has a team and virtually unlimited resources; you need a dedicated advocate who can level the playing field.
A Defense That Understands the Numbers
I have the experience necessary to handle document-heavy financial cases. I know how to work with forensic accountants to pick apart the state’s evidence, find their errors, and build a counter-narrative that creates reasonable doubt. We will not be intimidated by the prosecution’s spreadsheets and reports; we will challenge them with our own expert analysis and expose the holes in their accounting.
Taking Immediate Action to Preserve Your Future
The moment you are under investigation is the moment we must act. We need to move quickly to preserve evidence, interview witnesses before their memories fade, and engage with the prosecutor from a position of strength. Early intervention by a skilled attorney can often prevent charges from being filed in the first place or can set the stage for a favorable resolution that protects your record and your career.
Navigating Minnesota’s Courts with a Winning Financial Strategy
I have defended clients against serious financial crime charges in courtrooms across Minnesota, from the federal courthouse in Minneapolis to county courts in every corner of the state. I know the prosecutors, the judges, and the unique challenges of presenting a complex financial defense to a jury. This statewide experience allows me to craft a strategy that is tailored to the specific legal landscape you are facing.
A Singular Focus on Avoiding a Felony Conviction
My entire strategy is focused on one primary goal: ensuring you do not end up with a felony conviction. Whether through aggressive negotiation for a dismissal or a reduction to a misdemeanor, a successful motion to suppress evidence, or a complete acquittal at trial, every step we take is designed to protect your future. As a solo practitioner, your case is my cause. You will have my direct attention and unwavering commitment from start to finish.