Lincoln Lawrence2 years agohow screwed am I? partner in my small business has been using company funds to pay for all of his personal expenses started a small business with an acquaintance about two years ago. let's call them andy. andy and i have split responsibilities well and in a way that works for us, and one of andy's rolls has always been handling the financial side of things. we also have an accountant who comes in every quarter to make sure things are looking okay. at the start, I was watching finances weekly, but since Andy kept telling me everything was good and fine and correct, I stopped looking at it more than once every few months because I genuinely trusted they knew what they were doing. Well, Andy was out of town last week and it was time to pay our part time employee. So I go to write them a check, and I check our business account balance while I'm at it. We were never making a ton of money, just enough to pay ourselves enough to cover our personal bills and pay one part time employee. When I checked the account on Friday, I saw we don't even have enough money to pay the part time employee. Last time I checked the account (a few weeks ago) we had around $6k. Naturally, I freak out and begin looking through transactions, and I see some huge payments to AMEX and to a company I don't recognize. I sign into our company's AMEX account and see that over the last several months, Andy has been using the company credit card for personal expenses -- bars, ubers, food delivery, vape stores, everything, and insane amounts of everything. There are weekends where Andy used the company card for upwards of $400 at bars and days where they spent more than $200 on food delivery and vape stores. They've also been paying their rent directly from the company credit card. Between February and now, these AMEX charges total close to $15,000. I absolutely never use the company card for personal expenses, I haven't swiped that card once since maybe October of last year -- so this spending is 100% all Andy. There are some legitimate company expenses included here -- I mean, that's what we originally got the card for, to cover overhead expenses (we're in digital marketing, so it's all subscriptions and advertising costs). I haven't started going through everything, I'll be starting that this week, but from a quick glance I'd estimate that the legitimate business expenses couldn't account for more than 25-50% of that. I feel like an idiot -- I know I should've been paying attention to the finances, but I genuinely believed they were taking care of everything correctly like they said they are. I'm planning to confront them about it after going through every charge and seeing exactly how much as been spent, but I'm terrified of how this could affect me. Thankfully, the business credit card is in Andy's name, I'm only a manager of the AMEX account. Any advice on how to address this - and any insight on if there are legal repercussions I should be worried about - is much appreciated. 102
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Lincoln LawrenceLincoln Lawrence