QUESTION
What can I do if I found out business partner is stealing money?
Asked on Mar 25th, 2014 on Labor and Employment - Georgia
More details to this question:
My wife and I own a dance studio with another couple. Myself and the husband of the couple are listed as 50/50 owners on the LLC. We are supposed to put equal amounts of money in the business. I found out that he has been taking money out of the business account, falsifying the amount that his family pays for tuition, and charging personal items (concert tickets, Christmas gifts, phones etc.) to the company card and taking a 7,000 loan from the account, and repaying a week later. The total amount missing is about 12,000. What should I do? What is the best way to confront him? What are my options?
5 ANSWERS
Commercial Contracts Attorney serving Boise, ID
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Peters Law, PLLC
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You could go to the police or prosecutor and try to get him for embezzlement, but since he is an owner that may be difficult. Do you have an operating agreement or a partnership agreement? What does it say? Ultimately, you don't want to be in business with this man - he is a thief. So your best bet is to get him out of the business. You need to take all of your documentation to a local attorney who can devise the best method for getting rid of him.
Answered on Mar 26th, 2014 at 2:46 PM
Appellate Attorney serving Grosse Pointe Farms, MI
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Musilli Brennan Associates, PLLC
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Hire an attorney, do your accounting and either straighten this out of end the relationship (preferred).
Answered on Mar 26th, 2014 at 2:36 PM
You are friends first. So ask about the charges before you accuse. Once it comes out that the charges were fraudulent, ask him to pay back the money. If he refuses to pay back the money, the company (You) will have the ability to bring a lawsuit against him for the amount misappropriated. If you get to the point of needing to file a lawsuit, you should contact an attorney to assist you in this.
Answered on Mar 26th, 2014 at 2:30 PM
Be certain that you have copies of all the documents related to the business and your concerns about your business partner "stealing" from the business. It may be preferable for you to put your concerns in writing and reference the documents that provide proof for your concerns. Then schedule a meeting with at least both couples present and possibly a third party witness that could be your own attorney. In the State of Wisconsin, you also have the right to tape record the meeting without the other people's knowledge or consent. Depending on your business partner's response, you will then have to decide how to proceed. Good luck. Contact an attorney if needed.
Answered on Mar 26th, 2014 at 2:27 PM
You should retain an attorney to represent you in this matter. You likely will need to sue him to recover the money.
Answered on Mar 26th, 2014 at 2:27 PM