Not every business partnership works for the long term. Sometimes, serious problems develop between partners and it is time to get help in settling the dispute.
What if one partner is trying to take the other for a ride financially?
Dissolving a business partnership in a way that is financially fair to both partners can lead to hard feelings and chaos.
What Can You Do When You Do Not Trust Your Business Partner?
When things go bad in a business partnership, you should act quickly and carefully. Get help dealing with business disputes.
When a person suspects wrongdoing on the part of their business partner, it is important to move to protect oneself and business assets.
First, quietly seek the right type of law firm to handle your concerns.
Second, take action to protect the company assets.
Third, determine what the partner is guilty of including fraud, theft of trade secrets, breach of non-disclosure agreements, theft of company assets, or other business-related disputes.
Forth, arrange a meeting with the business partner to discuss the issues.
Fifth, rely on the chosen law firm to mitigate the situation.
Litigation Over Fraudulent or Negligent Business Practices
A law firm’s business litigation services can help the wronged business partner hold the wrongdoer accountable for the following issues:
1. Malpractice in accounting where financial harm results from improper tax accounting resulting in tax penalties, breaches of contract, and mis-valuation of assets.
2. Contract disputes involving corporate formation, partnership and LLC agreements and other business contracts.
3. Libel or commercial disparagement which can include claims that cause financial harm, false allegations, and malicious falsehoods.
4. Fraud. This can include misrepresenting facts to obtain the business partnership or falsification of data or financial records.
5. Disputes about the theft of trade secrets, copyrights, trademarks, or patents. This may be a dispute about who gets what when a partnership breaks up.
When You Suspect Your Partner Is Doing Wrong
When you suspect your business partner is cheating you but are not sure, take these important steps:
1. Hire a good accountant to look at the company books and other records. These could include bank statements, credit card statements, cancelled checks.
2. Get a copy of the company formation papers as filed with the secretary of state where you do business.
3. Now, consider hiring an attorney to review shareholder and other paperwork pertaining to the company and partnership.
4. If you don’t trust your business partner and suspect cheating, get out of the venture as soon as possible while recouping as much of the investment as you legally can. An attorney can help this process go as cleanly as possible.
More Ways to Protect Yourself
When you think your partner is cheating, you might also consider having your IT person make backups of everything for the company in a form you can use later to restore it.
Doing this quietly helps make sure the company is safe even if it turns out the partner is not cheating.
Next, get a fair value for the company. This is essential if you go or you ask the partner to leave.
Compensation will be based on the company’s value. Take steps to protect the company assets and to determine if theft has taken place.
Do you want to take legal action to recover the missing funds?
Do not get so hung up on this unfortunate incident that you waste years of your life-fighting.
Hire good legal representation to recover what you can and move on. Use this experience and knowledge for future business dealings.