2 ways a partner can steal from the business
You’ve entered into a business partnership with a long-time friend. Recently, however, you’ve noticed an unusual dip in sales. Could your partner be up to something sinister?
Trust is the cornerstone of any successful business partnership. Unfortunately, theft is not uncommon in the business world. And if this happens, the implications for the business can be devastating. But how, exactly, does theft happen in a business partnership?
Here are two common types of theft that you need to look out for when in a partnership.
Basically, a partner cannot withdraw money or take away property that belongs to the business without the approval of the other partners. If this happens, the partner in question will be deemed to have stolen from the business. Theft can range from stealing cash to equipment theft for personal gain. It can also include stealing intellectual property. An example of intellectual property theft would be a case where a partner sells your restaurant’s special recipe to a competitor without your knowledge and approval.
Fraud happens when a partner diverts funds meant for business purposes for personal use. Depending on the circumstances, this can amount to a criminal as well as a civil offense. An example of fraud would be a situation where the partner writes checks for suppliers but ends up withdrawing and using the funds for personal gains. To prove fraud, you must prove that your partner lied for the purpose of the funds they drew from the business.
The business world can be extremely competitive. It is not uncommon for a business partner to use their position of trust for personal and selfish gain. Find out how you can protect your rights and interests while dealing with a partner who is stealing from the business.