My business partner has been stealing from the start. Help!

Aunty B,

My business partner has been stealing from the start (since February 2008).

He just paid me $1,000 for August 2009, but because I found a difference, he agreed to pay me $4,000.

Then, when I reviewed July’s finances I found the same problem and he again agreed to pay me the difference.

He does not allow an accounting person to review all the books in order to know how much he needs to pay me.

Because everything was done in his house, I do not have all of the financial information. I need help to fix this problem.

Help Please

 

Dear Help Please,

This is what you should have: a shareholders agreement that states that you can access the books whenever you want. Somehow I don’t think you have one. What you must do is call a lawyer immediately. The lawyer will advise you of your options which will also depend on the agreement you have entered into.

But you must be very honest with yourself about what has happened here. A look at the financials isn’t going to fix your problems.

Fact one: twice you have been underpaid to which your partner has then admitted to.

So that means twice – at least – he has lied.

Fact two: he is hiding the accounts. This is very suspicious.

Put fact one and two together and you my friend have every right to feel you may be the victim of fraud. It also means that going forward you can not trust your business partner. Once the trust is lost, the partnership is over. So you will lose nothing playing hardball. Get a lawyer. Now.

Then after this has all been sorted out and you have moved on, do a small business course. You need to set the business up with proper processes and agreements. Believe me. It is far cheaper in the long run to do it properly at the start.

Good luck,
Your Aunty B

 

To read more Aunty B advice, click here.

Email your questions, problems and issues to auntyb@smartcompany.com.au right now!

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