What crime are contractors guilty of if convicted for fraudulent use of contract funds?

Contractors found guilty of fraudulent use of contract funds are charged with a felony because this crime involves intentional deceit for personal gain, which can result in significant harm to others, such as homeowners, clients, or financial institutions. A felony is a more severe category of crime that typically encompasses actions resulting in substantial financial loss, abuse of trust, or fraudulent activities. Since the misuse of funds affects the integrity of the construction industry and can lead to impaired trust in professional relationships, it is treated seriously under the law.

This classification also underscores the potential consequences faced by those involved in such misconduct, hinting at possible prison time and heavier fines compared to misdemeanors, infractions, or civil offenses. Misdemeanors might involve less severe actions or negligence, while civil offenses typically refer to breaches of contract or torts that may result in monetary compensation without criminal sanctions. Understanding the gravity of a felony charge in this context is essential, as it serves as a deterrent to fraudulent activities within the contracting field.