When Does Breach Of Contract Become A Criminal Case in Oklahoma

Under certain circumstances, a breach of contract can become a criminal offense, leading to legal consequences beyond financial liability. In most cases, a breach of contract is a civil matter, meaning the injured party can seek remedies such as monetary damages, contract enforcement, or other equitable relief in civil court.

Key Factors That Can Make a Breach of Contract Criminal

While failing to meet contract obligations does not typically result in criminal charges, some circumstances may lead to criminal liability, such as:

1. Fraudulent Intent (Fraud in Contract Execution or Performance)

A contract breach may become criminal if one party intentionally deceives the other by making false representations or promises they never intended to fulfill. Fraud in a contractual context typically involves:

• Misrepresentation of material facts to induce the other party into signing a contract.
• False promises of performance with no intention of following through.
• Concealment of key information that would have affected the other party’s decision to enter the contract.

For example, if a contractor takes payment for a construction project but never intends to complete the work, this could constitute contract fraud, which may result in criminal charges.

2. Theft or Embezzlement

When contract breaches involve the wrongful taking or misappropriation of money, property, or assets, it may be considered a crime. This is true in cases such as:

• Theft by deception – A party accepts payment but never delivers the promised goods or services.
• Embezzlement – An employee or business partner misuses company funds for personal gain.

For instance, if a business owner enters into a contract to supply goods, collects advance payments, and then deliberately diverts the funds for personal use without delivering the goods, this could lead to theft charges.

3. Forgery and Falsification of Documents

If a party alters or falsifies documents—such as contracts, or financial records—to mislead or defraud the other, this can be forgery or fraud. For example, submitting fake financial statements to secure a loan or forging a signature on a contract.

4. Identity Theft or Impersonation

Using false identities to enter contracts can result in criminal charges for identity theft or fraudulent misrepresentation. This often happens in business transactions where a fraudulent party poses as a legitimate business to deceive others.

Legal Consequences of Criminal Breach of Contract

When a contract breach involves criminal activity, the offending party may face:

• Criminal charges such as fraud, theft, forgery, or embezzlement.
• Fines and restitution, requiring repayment of stolen or misused funds.
• Jail or prison sentences, depending on the severity of the offense.
• Permanent criminal records, which can affect employment, business opportunities, and reputation.

While these are some possible outcomes, the exact consequences will be determined by the court. Working with a business law attorney is beneficial, as they can look at your case and work towards the best possible outcome.

Free Consultation With A Tulsa Business Lawyer

A breach of contract is generally a civil issue, but it can become criminal when it involves fraud, theft, forgery, or corruption. Understanding the distinctions between a civil contract dispute and a criminal offense is essential to protect your legal rights.

If you are involved in a contract dispute that may have criminal implications, contact the Tulsa business law attorneys at Kania Law Office by calling us at (918)–743-2233 or online.