Fraudulent Conversion Law and Legal Definition

Fraudulent conversion means the action of taking into possession another man’s money or property and converting or using them fraudulently for one’s own use and benefit or for the use and benefit of a third party to whom the property or money does not belong.

A fraudulent conversion may take place when a person actually appropriates the property of another to his own beneficial use and enjoyment or to that of a third person who assists, by the alteration of its nature. It includes the assumption or the exercise of the right of ownership over the goods or personal assets belonging to another, to the alteration of their position or to the exclusion of the owner's right. To constitute a fraudulent conversion there must not only be the intent to defraud, but the intent must be accompanied by positive acts of fraud. A fraudulent conversion could be either, first, by the wrongful taking of the personal chattel, second, by some other illegal assertion of ownership, by illegally using another's goods, or third, by wrongful intention’.[Brandt v. State, 71 Ga. App. 221, 228 (Ga. Ct. App. 1944)]