Business partnerships are a lot like a marriage or a family. There is a relationship with common interests, similar goals, and shared history, and like a marriage or family, there are disagreements. Sometimes, there may be hostility built over a series of disagreements, different approaches to working, and external factors ruining an otherwise fruitful partnership.
A business partner may be accused of stealing from the business on rare occasions. They may justify their actions somehow and may even be within their rights even if it harms the company. While there are often contracts in place, it is not necessary. This likely involves fraud charges.
To prove fraud, which can be a civil case, a criminal charge or both, a party must show that the business partner knowingly lied and caused harm to the business because of it. Here are the differences:
- Civil: A breach of fiduciary duties involves accusing a partner of taking from the company, likely from business accounts. A fiduciary relationship expects all involved to act in the business’s best interests. Taking money for personal benefit may be a breach, and the dispute’s solution may involve repayment.
- Criminal: These charges involve the theft of assets for personal benefit from the business or others while representing the business in a fiduciary role. If law enforcement becomes involved, the case becomes a criminal matter. Depending upon the circumstances, this can be viewed as fraud, theft or embezzlement. These can involve hefty fines, restitution, seized assets, and serving time in jail.
Outcomes are rarely cut-and-dried
Resolving fraud and business disputes is rarely a simple matter. For example, filing criminal charges rarely leads to immediate restitution by the accused. Nor is filing criminal charges against a partner reflect well upon a business if the accusers plan to remain open.
Protecting one’s interests is key
The accused should fight these charges, either seeking to dismiss them or reducing the penalties involved. People lead complicated lives where they are not always in control, leading to poor choices or desperate measures. Working with a criminal defense attorney who handles white-collar crime can be a tremendous help in helping the defendant clear their name or take steps towards a fresh start.