Misapplication of Fiduciary Property or Property of Financial Institution: Texas Penal Code §32.45

The Texas Misapplication of Fiduciary Property or Property of Financial Institution law gives police the right to arrest you if they believe you were a fiduciary and “misapplied” property that involved substantial risk of loss for the owner or anyone who benefitted from the property.

The Texas legislature codified this criminal offense in Texas Penal Code Section 32.45. The legislature did not update this law in 2025. In fact, this law has not been amended since 2017.

However, in 2025 the legislature extended the limitations period for all Chapter 32 felonies, including felony versions of this offense, to seven years for conduct occurring on or after September 1, 2025.

The Penal Code classifies the Texas Misapplication of Fiduciary Property or Property of Financial Institution law under Title 7 “Offenses Against Property,” Chapter 32 “Fraud.” Learn more about the Texas offense of Misapplication of Fiduciary Property or Property of Financial Institution below.

What is the current Texas law about Misapplication of Fiduciary Property or Property of Financial Institution?

AV Preeminent Texas lawyer Paul Saputo provides the current law defining Misapplication of Fiduciary Property or Property of Financial Institution in Penal Code Section §32.45, as follows:^[1]

(b) A person commits an offense if he intentionally, knowingly, or recklessly misapplies property he holds as a fiduciary or property of a financial institution in a manner that involves substantial risk of loss to the owner of the property or to a person for whose benefit the property is held.

The statute defines the term “misapply” as “deal with property contrary to: (A) an agreement under which the fiduciary holds the property; or (B) a law prescribing the custody or disposition of the property.”^[2]

What is the penalty for a Texas Misapplication of Fiduciary Property or Property of Financial Institution offense?

If the property misapplied is less than $100 then A conviction for Misapplication of Fiduciary Property or Property of Financial Institution in Texas is punished as a Class C misdemeanor,^[3] with a maximum possible fine under Texas state law of up to $500.

If the property misapplied is $100 or more but less than $750 then a conviction for Misapplication of Fiduciary Property or Property of Financial Institution in Texas is punished as a Class B misdemeanor,^[4] with a maximum possible fine under Texas state law of up to $2,000 and jail time of up to 180 days.

If the property misapplied is $750 or more but less than $2,500 then a conviction for Misapplication of Fiduciary Property or Property of Financial Institution in Texas is punished as a Class A misdemeanor,^[5] with a maximum possible fine under Texas state law of up to $4,000 and jail time of up to one year.

If the property misapplied is $2,500 or more but less than $30,000 then a conviction for Misapplication of Fiduciary Property or Property of Financial Institution in Texas is punished as a state jail felony,^[6] with a maximum possible fine under Texas state law of up to $10,000 and jail time of up to two years.

If the property misapplied is $30,000 or more but less than $150,000 then a conviction for Misapplication of Fiduciary Property or Property of Financial Institution in Texas is punished as a Felony of the Third Degree,^[7] with a maximum possible fine under Texas state law of up to $10,000 and prison time of up to 10 years.

If the property misapplied is $150,000 or more but less than $300,000 then a conviction for Misapplication of Fiduciary Property or Property of Financial Institution in Texas is punished as a Felony of the Second Degree,^[8] with a maximum possible fine under Texas state law of up to $10,000 and prison time of up to 20 years.

If the property misapplied is $300,000 then a conviction for Misapplication of Fiduciary Property or Property of Financial Institution in Texas is punished as a Felony of the Second Degree,^[9] with a maximum possible fine under Texas state law of up to $10,000 and up to life in prison.

How can I be charged with a Misapplication of Fiduciary Property or Property of Financial Institution offense in Texas?

You can be charged with Misapplication of Fiduciary Property or Property of Financial Institution in Texas if the state’s attorneys believe that each of the elements of §32.45(b) as described in the section above have been met.

What is the statute of limitations for Misapplication of Fiduciary Property or Property of Financial Institution in Texas?

Misdemeanor level Misapplication of Fiduciary Property or Property of Financial Institution charges have a two-year limitations period.^[10] Felony level Misapplication of Fiduciary Property or Property of Financial Institution charges have a seven-year limitations period for offenses occurring on or after September 1, 2025.^[11] For conduct before September 1, 2025, the limitations period for felonies is three years, the default felony limitations period under prior law, and the new seven-year period does not revive prosecutions already barred before that date.^[12]

Can you get probation for Misapplication of Fiduciary Property or Property of Financial Institution in Texas?

The Texas Code of Criminal Procedure allows both judges and juries to grant probation for Misapplication of Fiduciary Property or Property of Financial Institution, and judges are also allowed to accept deferred adjudication plea deals.^[13]

Note, however, that no matter the offense, neither judges nor juries may recommend community supervision for any suspended sentence of over 10 years.^[14] Also, judges may not grant community supervision after a conviction if (1) the defendant used or exhibited a deadly weapon during the commission of the felony or immediate flight thereafter and (2) the defendant used or exhibited the deadly weapon himself or was a party to the offense and knew that a deadly weapon would be used or exhibited.^[15]

What level of crime is Misapplication of Fiduciary Property or Property of Financial Institution in Texas?

The Penal Code classification of the punishment for Misapplication of Fiduciary Property or Property of Financial Institution ranges from a Class C misdemeanor to a first degree felony, depending on the value of the property misapplied and other circumstances.

Learn more about the penalty range for this offense in the section above.

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Legal References:

^1. Texas Penal Code §32.45. This law is current as of 2025.^2. Texas Penal Code §32.45(a)(2)^3. Texas Penal Code §32.45(c)(1)^4. Texas Penal Code §32.45(c)(2)^5. Texas Penal Code §32.45(c)(3)^6. Texas Penal Code §32.45(c)(4)^7. Texas Penal Code §32.45(c)(5)^8. Texas Penal Code §32.45(c)(6)^9. Texas Penal Code §32.45(c)(7)^10. Code of Criminal Procedure 12.02(a)^11. Code of Criminal Procedure 12.01(3)(A), as amended by SB 2798, 89th Legislature (RS), Sections 1, 3^12. SB 2798, 89th Legislature (RS), Section 2^13. See Chapter 42A, Texas Code of Criminal Procedure, Art. 42A.054, Art. 42A.056, Art. 42A.102^14. Art. 42A.053(c), Texas Code of Criminal Procedure^15. Art. 42A.054(b), Texas Code of Criminal Procedure