What is it considered when a contractor uses funds intended for one project to start a different project without paying laborers for the original project?

When a contractor uses funds that are earmarked for one project to start another project, especially without fulfilling the payment obligations to laborers for the original project, this action indicates a serious ethical and legal violation. It reflects a behavior that suggests an intent to mislead or deceive stakeholders, such as clients, employees, or investors. This conduct is typically categorized as intent to defraud, as it undermines trust and violates the basic principles of financial and project management integrity. Financially mismanaging funds in such a manner can also lead to legal consequences, including criminal charges, as it constitutes misuse of resources meant for a specific obligation. Therefore, the scenario described aligns squarely with intent to defraud.