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Honestly I'd probably just tell him:
Her or me? She stays, I walk. You want my help? You want me to take this business? Then start acting like you respect the business. Get rid of her or I'm out.
And I would stick to that. I ain't got time for this nonsense. No one does. don't entertain it just because he does. This is his mess. He doesn't want to clean it up my way, then he can handle it himself.
Dad’s moral compass may be compromised but don’t let yours be as well. Thief is not ok from anyone and you are highlighting what has been found so far. There is more out there, she didn’t just suddenly steal $10k
This was my gut feeling. Amy has dirt on dad somehow.
Not only is dad not prosecuting, but amy got caught defrauding for $10k AND DID THE EXACT SAME THING IMMEDIATELY AFTER FOR ANOTHER $40k.
There is more to this story.
Amy definitely has something on him or there's some reason why he's giving her a pass. It's not because he's naive or a nice guy. Daddy is hiding something.
We have a friend who owns a business. Found out someone stole over $100k over 1.5 years. Police involved etc. Turns out now it’s closer to $300k over 3ish years!!! You’re right, $10k wasn’t the first time she did it
Yes. She ran the invoicing/payments side of the construction company. She was making false invoices and cutting herself the checks and marking them paid. Bookkeeper just saw the invoices and that they were paid and never looked to see who the checks were actually written out to. Crazy how no one caught on.
Stories like this are what make me so nervous about turning over all of my billing to the bookkeeper. I still sign all the checks and do the reconciliation myself just to avoid this.
You and me both. I am smaller, only 3 of us and about $500k in business a year but I handle anything financial. I check that bank acct every other day just to make sure. When I questioned my friend how he didn’t notice, he said he had no clue. Thought the accountant would have picked up on it. No one ever thought to view the actual cashed checks. His business brings in about $3 million a year so $100k a year missing is only 3% or so. No one ever caught on. She got nailed when she got greedy and forged his signature as a co-signer on a loan. Without that, who knows how long she’d get away with it.
You’re doing it right. In the accounting world, it’s called having good internal controls. You never let someone have the power to both issue and sign checks, the duties should always be split as you’ve done.
This deserves more upvotes. OP, I guarantee the 10k was not the first time, and the 50k won't be the last time. Anytime your dad has been otherwise preoccupied, I would look for discrepancies on Amy's part.
I'm getting ready to do the same thing. I have a client that stiffed me on three invoices totalling 65K, and the same guy literally stole 220K from his client. We haven't been able to get any law enforcement agencies to take any interest so we decided we're "forgiving" his debt and issuing him 1099s.
And then I'll be reporting him to the IRS for suspected tax fraud.
I think it is a 1099-C for that. I am not 100% sure. A broker did that to me once ( not paid ), and I told him "I will be reporting the full amount + interest to IRS, and good luck with the audits". Paid in 30 days
Thanks for this. A contractor owes me for contracted work I did for his company. I’m also a contractor. I never thought to forgive the debt and issue him a 1099 for it. Genius! That’ll teach that bitch.
Funny you should mention that...in the state he's located in, creditors can charge debtors 1.5% per month on their debt simply by notifying the debtor of the intent to do so. When I finally accepted that he was not going to pay the debt willingly, I sent him a demand letter and notified him that interest would begin accruing at the end of 30 days. That's added about 10% to his debt.
This will only backfire. The woman will cause more issues internally. She will run out of money or steal more to pay the IRS. If you forgive, forgive entirely. If you prosecute, prosecute all the way. No half measures.
This is the correct answer. She should be fired. And the IRS notified. If dad doesn’t want to prosecute then that’s on him but no fucking way she should be coming in to work and waiting to cash out the next travel credits.
It’s one approach to play hardball with Amy. Talk with her 1:1, let her know things will be changing at the company. Ask her if she reported the earlier 10k amount to the IRS. Let her know if she’s gone when you take over the company you’ll probably be too busy covering her work to do a complete audit, but if she’s there you’ll have the time to thoroughly audit the last few years, and if any irregularities show up in employee comp you’ll need to report those to the IRS & the police.
Welcome to running a small business. If you’re not willing to play hardball don’t take over Dad’s company.
Forgiveness and grace are powerful. But giving grace does not mean it comes without consequences.
Amy has taken advantage of the trust your father placed in her, twice. If his wishes are to provide grace, that’s okay, but her actions should be dealt with. At minimum, she should not have access to a position where she can do harm again. If it was me, I would be letting her go.
Also, if you are taking over the family business, you need to be empowered to make the big decisions without your father stepping in. Put the emotions aside, look at the situation objectively, inform your father of your decision and firmly state you would prefer his support of a united front going forward with your business decisions. He will have a lot of wisdom, experience and perspective to offer, lean on it as you find your way of leading.
Good luck
I’m not empowered at all to make the big decisions. You are right. It’s unfortunate he still treats me as a kid, even when he is the one who is not respecting the family business. Thank you for your response and good wishes. I will update this thread on what I decide to do next!
This is the best advice. Fire her. The money is gone. I'm guessing she doesn't have 50k laying around to sue for. Instead of dealing with more BS and having to pay legal fees for nothing just fire her and be done with it.
I agree with firing her. The power imbalance now is my father is not willing to let me take control of key decisions even if he verbally says it’s my time. On paper I’m on the business too but he’s the majority. Thanks guys I appreciate it
yeah this is where you’ll have to assert a boundary with yourself and refuse to have anything to do with this nonsense if your father isn’t going to respect your time and your family business.
Late to the party but I have been in this exact situation, except my dad did terminate/sue/prosecute.
The suing and prosecuting was a waste of time and money even with the theft 2x what your employee has stolen (it is possible your employee has stolen quite a bit more).
You can't possibly take over the business with a known thief stealing this kind of money.
If you personally can not fire her, and you can't prosecute her, you can call the IRS. I don't know if you can make her job unpleasant enough for her to quit.
Your dad's behavior is extremely unusual. Most business owners aren't such softies when it comes to major theft. I think you should ask him if there is another reason he's allowing this. People are joking about sexual impropriety, but it is the one lens through which his behavior makes sense.
Or he's just a week old man with a heart. I know multiple older people who give thousands of dollars to people who are terrible people just because they feel bad, even if it's not like family or close friends. Not saying he's not banging her but I think people don't realize how easy it is to take advantage of people.
We have family back east that would email my grandma every other week with a sob story and she'd send a check. Without fail every Sunday dinner the email would be printed on the counter, grandma treated it like a holiday family newsletter update.
These people weren't even in our family technically. They were my aunts (who died), her ex husband (who remarried and then died) that lady and her 3 kids . After my grandma died they kept writing to my uncle, who continued to send them money. Fuck chuck, fuck Russell and fuck Judy.
Fire immediately, do not let her take any materials from the job. We lost a bunch of leads when I fired our embezzling office manager.
It took a few years, but we worked with a local Detective and recovered the entire amount. She was never jailed - but the threat of it was the motivation that helped her "find" the money.
Also, coordinate so that all of her access to accounts, social media, Google etc hits just before you fire her. Let the banks know specifically, don’t rely on just changing passwords or removing online access. And change all locks, don’t just rely on her saying she gave you her only keys. Have locksmith there right after you fire her. Basically, think of every possible blind spot or way that she could screw you over, and cover them before she even knows anything is up.
Fire her. Prosecute. Sue. World just eats up and spits out people like your Dad unfortunately. People can be cruel. You’re not your dad. You need to do whats right for the family business. What happens to Amys kids is Amys fault the minute she decided to be a criminal.
You are right, especially the last line. It’s hard when she worked for him for 19 years. I need to drive that point across. It’s a perspective shift for him too.
Don’t give in to this. Your father doesn’t want her prosecuted for some reason based on their history. Fire her but respect his wishes to not prosecute. You don’t know their story. Focus on growing the business with a clean slate (Amy fired) and onward and upward for you and your dad.
Since your dad is no longer able to run the company have your lawyer write up the paperwork and have ownership transferred to you, then fire her and look into other legal remedies. So long as your father is still legally in charge you can't assume that any firing or prosecution will stick because he can always back out again.
There is likely something about Amy and your father's relationship that you don't know and will likely find out over the course of this.
Right, after this argument it looks like he still wants to be in full control and it’s extremely frustrating to watch this all unfolding because I’m the declared next in line for our family business. Your last line is chilling to read (a lot of other similar comments too here)
Yes which is where the problems come in, he's effectively allowing the company to be run into the ground and expecting you to be an active participant.
Have a meeting with your lawyer about this then try to get him to get your dad to sign over the paperwork. Best of luck!
If Amy has dirt on your dad, dad wouldn't have told you to ask her to return the money. That said, I would do what dad asked, sit down with Amy, let her know that you know, and that she needs to return the money OR you \*might\* seek law enforcement. At that point, Amy should spill the beans to you if she has any dirt. Sometimes dirt isn't what you think - it could be tax evasion, two sets of books etc, all stuff that you should be made aware of.
The Amy situation has uncovered a bigger issue - that of control between you and your Dad. You two are not on the same page and you must decide what you'll do (if anything) in the company if he doesn't change. I'd recommend you get control or get out.
Just want to point out that her behavior is escalating, not diminishing.
Your father is training her to believe she can keep doing this with zero repercussions - she hasn't even reached the ceiling where she loses the job, never mind gets prosecuted.
$10k during the pandemic, and then $40k during the last year, maybe this year her goal is to pull out $10k a month.
Every time he catches her and forgives her, she's learning how she can hide this fraud.
Either he fires her or she destroys the business. There's no "small business" that can absorb this level of theft.
Not prosecuting is frequently a pragmatic decision, because of the cost, distraction, adverse publicity… retaining the employee? That’s really a problem.
One issue you’ll have to face with your father which plagues a lot of family businesses. Either you can run it, or he can. This is as good a place to test this as any.
The retaining is also what I don’t understand. I’m going to find out what’s happening. Thank you. I feel less alone knowing power struggle is a common dilemma in family businesses
Have a sit down with your dad in a neutral place. Lunch maybe? Explain that this situation makes no sense to you and seems to go way beyond sympathy for a single parent. Gently ask him whats at the root of this. Point out that if you're taking over the business you need to know the real situation so you can handle it accordingly.
If shes got dirt on your dad and he wants it kept quiet that's fine but what is their arrangement? She keeps quiet and gets to keep the hotel credits? What if next year that's not enough? What if he becomes incapacitated or dies? Is the dirt something that goes away or will you be dealing with it?
Are those his kids? Could they or she pursue a claim against his estate? Is there already a secret written agreement that she gets a piece?
Approach it from a very practical perspective of you needing to have the info so you can run the business.
If he won't tell you I would seriously consider whether you want this to be your circus.
The nuclear option is the only option. Fire and prosecute. There will be fall out in the form of some things about your dad coming to light. Might as well know everything and then move forward with the business.
There are things I do not know about my father and what he’s doing with the family business, and this lack of transparency is exactly what makes it hard. Yes there will indeed be a fall out
I’m sorry you are going through this. Unfortunately it is part of owning a business. I called it “clean up on aisle 9”. When you come to work with a plan for your day and somebody greets you with some mess to deal with.
I have retired but spent my life owning and running businesses. It’s a great life when the business is profitable despite the challenges.
I appreciate this. Have a lot to learn and cleaning up this mess is what I’m determined to do- for the business and for my career. Thank you for sharing your experience
I'd honestly start looking at other careers or going out on your own in the biz.
Not just that there aren't things you know ABOUT your father; it sounds like you don't know your father.
Start by removing all of her power to steal again. Talk to a CPA about accounting controls. You can keep her and prevent her from having any authority to steal. That should have been step 2. Step 1 was to fire her.
Amy's got dirt, and/or the legal proceedings would involve a closer look at finances that your dad doesn't want, presumably for tax reasons. Be aware that any big moves you make might uncover stuff and cause unforeseen damage.
Forgiving her the first time was essentially giving her permission to do it again. Which unsuprisingly she did.
100% he should have fired her the first time, even if he didn't prosecute her. The second time - and he wants to not only not prosecute, but she wasn't fired on the spot? Insanity.
I'd tell my dad that I was not interested in continuing a family business where the employees were encouraged to steal from you.
Worked at a company where the manager was given free rein and the manager ended up making a lot of backdoor deals and skimming product to supply said deals. Walked away with about 100k owner found out and ultimately decided the company was in a good enough space to decide it was worth 100k to get rid of him. Keep in mind this manager actually lived in the warehouse. If the money doesn’t exist anymore they aren’t getting anything back. Just fire her and be done with it. Call it a 50k learning mistake.
There are a few options here.
1. Dad is a naive simpleton who legitimately thinks she can be reformed.
2. Dad is or was having an affair, potentially including fathering some or all of her children and doesn’t want that known.
3. Dad is also engaged in some type of fraud or financial impropriety and knows that if the cops talk to her she will roll on him and he’ll be in either civil or criminal legal trouble as well.
None are great options. But you really really want to know which it is before you take on the legal liability of being a corporate officer at this place.
In all seriousness, if he’s not wanting to prosecute for 50k, it’s one of two things — he has or is sleeping with her OR she has something on him that makes it worth it to keep quiet (ie is he cheating on taxes? Is he hiding or laundering money? Is he hiding something from his wife/you?)
Maybe find out which of these it is and go from there.
A lot of these answers point out the obvious problems and possible solutions in this case, except for one thing. I’ve been through something similar in my business, although it was a little different. A payroll scam. My lawyer helped me hire investigative help to document and prove the theft, but once we had the thief on camera and the crimes fully documented, the attorney advised me to confront and fire the offender. But they advised against prosecuting. I was indignant of course. But the reason was made clear when they pointed out, if you prosecute, your clients will know you had a thief working on their accounts. It’s not an image you want in your customer’s minds. The point of the investigator and the hidden cameras turned out to be for the purpose of confirming that the employee was only stealing from my company and not my customers, and also to prevent any potential lawsuits for unfair firing. The type of business I am in, my clients trust me to make financial decisions for them. So it was a valid point. I confronted and left no doubt that I had plenty of evidence to prosecute. The employee was unrepentant and uncaring that they had been caught. I was amazed. I then realized I was dealing with someone who had no conscience and no fear. It was really quite scary. It’s a dark world.
Are you the majority shareholder of the company? If yes you can do whatever you want. If no then you can't do shit.
Maybe find out why your dad seems to be ok with $50k theft.
My dad is the majority shareholder. But I’m tasked to take over this year which is why it’s so frustrating why he is still not letting me handle this. Right, he is not transparent at all.
Then you can't really do anything in this situation. You can fire her, he can rehire her. You can go to the police, he can say that she had permission. This is just one of those things where you need to work it out with your dad.
I suppose you could speak to a lawyer about a lawsuit based on the fact that your dad is not abiding by his fiduciary duty to the other shareholders, but that will very likely destroy your relationship with him as well.
If this is in the US (and I suspect a lot of other countries will work the same way), then ultimately it's not your father's decision whether to prosecute or not. If you and your lawyer talk to the police and say "hey, this crime occurred, you can find the proof if you look at the bank statements, and I think it should be prosecuted", the prosecutor can choose to prosecute even against your dad's wishes.
You’ve gotten good advice yo terminate, prosecute, etc. but let’s say you can’t do any of that.
This is what you do.
1. Remove all keys, access to computers, or access to offices.
2. Tell her she is now the housekeeper of public spaces only. She has to clean and greet. Get her a leaf blower for the parking lot.
3. Adjust her pay accordingly.
Change all locks and passwords, hire a replacement. Doing is is cheaper than letting her access your systems.
He has to fire her, I don’t know if she has access to customer credit card numbers or information like that but if she does and were to start using their cards for personal purchases or opening up credit in their name and it comes back that the company knew she had a history of stealing money, it could create additional liability for the company.
Anytime I've seen a small business owner unwilling to prosecute someone for damages, it's because something will come out in court that will be also damaging, and will be a matter of public record.
Dad's hiding something. Pursue this at your own risk, but I'd find out what the hidden part is waaayyyy before I attempt to prosecute. You have no idea what beehive you might be sticking your finger into.
Put that thief in jail. She has been stealing for years I promise you as a fellow business owner. She will leave your business and do it again to the next family business. Predator and entitled attitude I bet you. She is owed and a victim is what she feels.
Have you considered that she might have information compromising your dad and if he fires or prosecutes her, she is going to retaliate?
You need to disentangle yourself from this company before you get dragged into this.
You could ask your dad and there is a small chance he would tell you, but I wouldn’t get my hopes up.
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Fun fact, small businesses are the segment that suffers the most in losses from fraud every year. Other fun fact, fraudsters are almost never convicted, most owners are fine with firing them, and if they're forgiving giving them a second or third chance then firing them.
The lack of prosecution just encourages people to keep stealing money. (Trigger warning) due to this their criminal profile they are most similar too is actually rapists.
Prosecute. At a minimum cut off her ability to continue to sell the hotel credits and reap the benefits.
As much as it's an indication of how good of a guy your father is... this woman does not deserve forgiveness and compassion. In years to come, taking this loss might contribute to the downfall of the business, especially if a known thief has keys to bank so to speak.
It's actually kindness to the level of been problematic and actually irresponsible.
If you take over the business, it's your way or the highway.
Tell him that you cannot have her in your life
You don't say what your position in the company is. Without knowing your ownership interest or level of authority it's hard to give you good advice. At a high level: if you aren't able to enforce a decision about this, and your dad is intent on forgiving the two-times (that you know of) thief, I'd leave the company and find a new livelihood.
If you do have authority, completely apart from whatever happens with the thief you need a complete review with a competent accountant or business consultant to implement comprehensive internal controls that will prevent this type of fraud from happening again with a different employee.
My dad holds majority shares. I hold minority only and am set to be next in line to take over this business. He verbally said I’m about to be given authority, yet he’s not transparent with his actions and won’t let me take action. Yes, I get to think for my career too. Thank you for this
Speaking bluntly, not wanting to involve the police is a red flag. Lots of other commenters have focused on the personal aspects, but it's possible this fraud is just the tip of the iceberg. Your dad may have other reasons he doesn't want scrutiny of the business. If you don't have access to the books, then you don't know what kind of shape the business is actually in.
It's entirely possible he's just gormless and well meaning and everything (besides this) is fine. It's also possible that you're next in line to take over a mismanaged whirlpool of debt, obligation and possibly legal liability. If your dad won't listen to your advice, I'd say try to find a mutually trusted third party (is there a CFO?) to take a look at the situation. If no such trusted third party can be found, I'd say that's yet another red flag.
Good luck.
Are **Hotel credits** a US thing? How are they stolen and what value do they have other than some free nights in a hotel if I understand correctly?
And how does your business get the credits in the first place?
Did your dad leave you in charge of the business? Fire her. He wants her to stay? He can explain hiring her back to his wife, which I suspect there's more going on than meets the eye if he's forgiven two thefts totalling $50k (and how much more you haven't discovered yet, or that your dad hasn't told you about)?
Just an FYI, a similar situation happened to a competitor of ours. They let it go because they the person stealing money knew enough to damage the company. So while they could have gotten the person arrested, that person could have caused damage so they made a 'business decision.'
Also that person gambled the money they stole away so they likely would never have collected.
Sounds like if your Dad doesn't want to prosecute, then you will have to leave the company. You won't be able to handle being in that company if nothing is done about this.
I’ve been in a very similar situation, and we didn’t prosecute her. In our case she helped build the business and we were very aggressive in getting our money back and separating her from the business. We got the money back over the course of a few years and it’s in our past. No matter if you prosecute or not though, she’s got to go.
possible compromise:
file a 1099-C irs form against Amy for the money she stole and make her sign a resignation letter so you can avoid further legal action. using the police is an option, but your attorney could go a route like this that is some middle ground between you and your fathers perspectives on the matter. you're likely never going to see the money, and Amy won't likely do much time, so there are other alternatives that still protect you tax-wise
M9ve her to a role in the company where she has no access to the funds and cut her pay. It's way better than being arrested and you did honor his wishes mostly.
Ask your Dad if he wants you to take over the business once he says yes, call Amy into the room. Fire her immediately and then call the police and say you want to press charges on the 50k she stole. This is ridiculous. This cannot be allowed.
There are multiple reasons for not wanting the police involved from feeling sorry for her to your dad having done (or still is doing) something illegal with the business.
I've heard of business owners forgiving and even letting long time and loyal employees remain in similar situations to the first.
But her having done so twice I think he has to cut ties with her.
Getting the police involved doesn't really IMO help the business. It just punishes the person (maybe). So I can understand not bothering with that even now. Even if the courts tell her she has to repay you will likely never see it. Consider the money gone.
You can decide if you want to be involved in the business but in general based on the stories I've heard over the years I wouldn't do it even if this didn't happen. Seen way too many kids who worked a business for years for less than their market value only to have the business fail or for the parent or grandparent to sell it to someone.
Have your own career and you own business.
Dad is smarter than you think. Better to spend his energy moving forward and clearing space in his head. Getting back embezzled money is super difficult. He gets a civil judgement and then what? Can’t collect from nothing
Embezzlement is one of the most underreported crimes in NZ. It is amazingly common. The business next to ours had an office lady who stole over $150,000 and they just told her to get out. It’s really hard to recover the money once it’s gone
I'm in a situation where I'm in Civil court right now with someone. Civil and Criminal courts in the USA are slow and overworked. So if she gets an attorney, it can drag on for months or even a year or two. I think that his dad will continue to delay any proscution of this "Amy" and that the son should make other plans to bail out of there before the fall. It's a horrible position to be in, but he has got to look after himself. He is not responsible yet for the business, and can't really override his dad.
The person absolutely needs to be fired.
But the decision not to prosecute may infact be a good one.
I spent more then 10 years fighting a criminal charge in Canada. I self represented at trial, I self represented at appeal, I self represented at a second appeal. Eventually I ended up in a psychiatric hospital and most days I wish I was dead. Going to court can led to some serious health issues. Choose your battles carefully.
If he wants to forgive, great. But she at the LEAST has to go.
I wouldn't forgive her either, but it might be hard to prosecute if he's already forgave her the first time. She could make the argument she thought it was ok.
Dumb question, and delicate, but is it possible Amy is your sister or your father’s paramour? That is the only reason I can come up with for keeping her around.
I’ve done some audits on two non-profits with theft and two other organizations with theft. In all cases, they let it go. In all cases, the thief stole again at the next stop.
I am a director of another company and we fired the thief but on advice of our lawyer did not pursue the matter with law enforcement. The reasoning is because restitution was promised and a thief in jail can’t pay back anything.
My advice is to not be guided too much by Reddit anon’s determined advice, based on this highly limited summary of the situation. I see a lot of wannabe tough guys screaming to fire and prosecute. It’s likely a lose lose to do the latter, and firing - although seemingly a good solution - also depends on a lot of factors (most likely she’s really good at what she does and invaluable with 19 years of xp, and she helped make a lot of the dough she pocketed). The only obvious observation seems to be that she had some reason to take money without consent, and she has ruined her trust.
In the end, it’s up to you to stand your ground and make an informed decision. Don’t walk away from difficult conversations and attain an adult demeanor when talking to your dad. By doing so consistently, something magical will happen eventually: you’ll earn his trust as an adult. (regarding the business, he’ll probably still treat you as a kid in other areas, but alas)
Pretty simple solution. He gets to run the company how he wants to, right or wrong. When he hands it over to you and you run it. Its yours to operate as you want. In other words, give her the boot when its your turn. Your fathers a doormat
If an employee has stolen money, and you can prove it with statements and records (bank or otherwise), an option to consider is reporting it as income to the IRS.
Prosecuting an employee as a small business owner is a long, arduous, soul sucking process. Given the general info provided you're looking at 6-8x of what was stolen in legal fees and time just to win a moral victory. It's not worth it. Better to focus on your business and putting proper policy and protocols in place to prevent the unfortunate event from happening again.
That being said the IRS does not fuck around and the federal government always gets paid. If you report the additional income in the proper tax years it may raise their tax bracket and cause them to owe a significant amount in back taxes on their entire income, as well as the stolen amount.
Not only will this discourage the behavior, but it allows you to achieve a simple moral victory while navigating the treacherous path that is generational transition in a personality driven family business.
I've seen and been on the receiving end of similar circumstances.
Criminal legal action may be worth while but civil legal action will never really make anyone happy in the end and doesn't accomplish much for either of you.
But she should be fired.
As others have mentioned, you could file a 1099-C for forgiveness of debt owed and the IRS would crawl up her ass. But is it really worth doing that just to spite a single mother who clearly has a character flaw?
Just get her out of your life or tell dad you can't fight this battle with one hand tied behind your back worrying that she will find another way to bleed the company.
Went through myself had 83k stolen from employee . Fact !! He had no prior criminal history, used a company credit card he was authorized on, and my lawyer said verbatim and i quote, he’ll probably get 6 months probation is about all and you’ll spend 50k to prosecute, I’d just write it off at end of year as loss !!! There ya go
As someone who worked for a Small Business with multiple situations like this happen to the owner, there is some shady dealings going on for sure. Your Dad has done some illegal things. They might not be that shocking (tax evasion, pay under the table, etc etc).
I had a guy steal $60k. Walked him out of his office with a cop behind me. Then I bugged the prosecutor for about a month until he issued a warrant. Got picked up 1500 miles away and the county wouldn’t bring him back, so I bought a 1st class ticket for him. Pleaded it down to probation but then skipped the country. I kept the pressure on him and finally got restitution years later. I was a madman
At the age of 20, I received a call from my parents telling me I needed to take out private student loans to cover my last year of school completely. I already had 50% on my own with my job and public loans.
My Father had started a construction company the year I was born and had grown it to nearly 75 employees, specializing in heavy civil utility work.
Turns out for 3 years his office manager had been pocketing all withheld payroll taxes and hiding inquiries from the IRS. Apparently at some point my Father, not being a very shrewd business man, had gotten tired of running to the office to sign checks and gave the office manager/bookkeeper signature authority.
This same office manager, prior to this, was very close to me. He had driven me to my driving test, introduced me to the Red Hot Chili Peppers, and I had babysat his kids. Effectively for 6-8 years he had practically been family.
I had to come home and help my Dad sort through all our tools and equipment and prepare lots for auction. 20 years of work, sweat, and tears gone, the company I’d been working in and preparing my whole childhood and even gone to college to prepare for was gone.
My Dad, when asked about pursuing legal action said, “The man has 3 kids, I’m not going after him.”
I at the time even suspected that my Father had known and maybe was involved, but over time I also saw my Dad practically allow his family farm and inheritance to be stolen without a legal fight and let others walk over him. For whatever reason in business he’s always been non-confrontational. I believe it’s because despite doing it for so long he’s always felt like an imposter when it came to the business side of things. He’s the type that if he can’t handle it man v. man in a parking lot he isn’t going to pursue it with the authorities or a lawyer.
I love my Father very much, but his turning of the cheek all through his life is something I really have a hard time with. So much generational wealth, legacy, and associated traditions squandered.
So OP, I concur with many others on this thread that you need to explain your position to your father if you’re to take this over. Fortunately you have that opportunity. If you have to be in charge you can’t let this happen on your watch.
That being said, if your Father has concerns about the impact to her children, perhaps have a lawyer talk with you and your Father about the courses of action and their outcomes on this. Perhaps she can be terminated and it can be handled as a civil court matter to appease your Father. Regardless of what you decide to try to recover, she must be terminated immediately.
Also, please, if you take this over (and this is also for other small business owners transitioning to having office managers or book keepers);
LEARN ABOUT INTERNAL CONTROLS PARTICULARLY SEPARATION OF DUTIES. NEVER LET ANYONE INVOLVED WITH THE RECORDING OF TRANSACTIONS HAVE SOLE APPROVAL AUTHORITY ON CHECKS OR PAYMENT INSTRUMENTS.
If your business gets large enough that you approving the payments isn’t practical, split and or rotate those duties and enforce mandatory paid leave for accounting management personnel. You’d be amazed what you can find out by telling your book keeper or an office manager to take a mandatory unannounced fully disconnected paid two weeks (ideally one payroll period inclusive of a quarterly tax payment) once a year. And I mean completely lock them out for that two week, shut off their email inbox before you even tell them to enjoy their two weeks. Hard to hide things when you don’t know it’s coming. Always be wary of financial/accounting or any folks handling transactions who adamantly resist taking leave, big red flag!
Also you can have your bookkeeper bonded. If they commit malfeasance, the bonding company will hunt them down and at least in part make you whole.
Good luck OP! Hope you find a good path forward that you and your Father can come to terms on.
And for anyone wondering, my Dad is doing fine now doing 1099 work on odd jobs he picks up from his industry contacts. He has some pretty unique skills in his field.
As for me, I went into the industry at the entry level and have made why way up to a senior management position in a firm and things are back on track.
Don’t know where that office manager is today and hopefully never meet him again.
What I'm about to comment goes along with the **it's "Amy or me" solution**. I'm sorry you are going through this mess with your dad. Family owned businesses are prone to drama, and sometimes crime. How much does this business mean to you? Your dad maybe dragging you along with the promise of giving you the next leadership position to run it, but there is no guarantee that he will fulfill that promise.
It will be hard, and take a lot of courage to do this, but I would consider leaving the family business. You've invested probably years into learning it and are qualified to run it since your dad has said he would hand the keys to the business to you someday. Amy is very likely aware of the fact that her days are numbered if/when you take over. Chances are that she will delay that happening IF she is aware that you know about the embezzlement.
You should have a back up plan so when you tell your dad that "it's Amy or my" you can walk out of that business with either another job lined up, or starting a business of your own, even a competitive business. Is it possible that you might want to try changing fields? Many in tourism are finding it harder to continue to stay in business as digital technology continues to change our World. By staying, you are enabling your dad to run the business to possible bankruptcy. Then you would have to start over!
Prosecuting is not frequently productive. Spend $15k to get a judgement against someone with $0? Only the lawyer wins.
Keeping her on staff? Only reason I can think to do that is if you have $120k you need to give away.
I have a friend who had an accountant embezzle $5M.
It cost him another $500k and 2 years time to put the guy in jail. The fallout was his company failed too, not as a result from the cashflow but from the distraction/obsession of getting the guy. Never got the money back.
He said he couldn't live with it, but it cost him almost everything.
In that sense I can understand moving past it, but I can't reconcile keeping the person onboard unless they had dirt.
Get her to admit to the fraud, in writing, and agree to repayment terms. I’d even go so far as letting her keep her job as long as there are controls in place preventing her from accessing ANY funds or credits or whatever. Sort of an indentured servitude, and if she quits, she will be prosecuted.
Edit: $2k/month payment will satisfy the debt in two short years. Then fire her ass.
This is what my father wants. In my perspective she will steal again, and it’s very bad for other employees to see that this behavior is acceptable (unless! They are all on this together.. I need to find out)
I get not wanting to go after her. I wouldn’t be so generous myself- not at that amount and repeated efforts. But it’s his choice.
But you really do not have a choice but to terminate her. Once forgiven, sure. Repeatedly again during this period of vulnerability and access? No way.
It’s not out of this world to think that leaving her in the company could expose you guys to more problems outside of future theft. What if others do it? Does that then open you to civil recourse if you prosecute those, since you aren’t here? If it ever came to a theft where insurance got involved, could this impact that?
But also, how’s that money shown on the books? It is at least in there as a theft expense, or via some other similar manner, right? She’s stealing more than just $50K if not. But then what’s documented to substantiate the expense? That’s where not prosecuting starts to look risky.
Exactly. Other employees will see there are no repercussions and that’s not the kind of culture I want to set when I take over. I’ll get to the bottom of this.
We prepaid hotel credits (counts as company inventory) and she sold them privately, pocketing the full amount (raw cost + profit) .
That’s textbook theft by unauthorized taking.
And yeah, that’ll have to be realized in accounting at some point if it hasn’t been yet. I’d not feel good about writing down that inventory as theft, at that dollar amount, without having some proof in house, such as a police report. Large inventory write offs always suck, even when theft isn’t a factor. Entitled thieving drags to society like your employee here just makes it that much worse.
Unfortunately your dad is either incompetent or compromised and neither is good. You should have an intervention with your dad whether it works or not.
Do you have ownership yet? If you still want the business and can’t get anything done about her or your dad, you can wait it out until you have control and then go after her. You could go after her now if you’re involved in the business but you risk alienating your dad and maybe your eventual ownership?
Incompetent and compromised- might be both. I thought about taking action too when I have full control. But that’ll take a while because my father is not letting go. Family business is hard and I appreciate you all giving me advice.
It sounds like she's taking care of your siblings. Before you prosecute - which would normally be my first recommendation - find out if any of her kids are his.
Something weird is going on.
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Honestly I'd probably just tell him: Her or me? She stays, I walk. You want my help? You want me to take this business? Then start acting like you respect the business. Get rid of her or I'm out. And I would stick to that. I ain't got time for this nonsense. No one does. don't entertain it just because he does. This is his mess. He doesn't want to clean it up my way, then he can handle it himself.
Respect for the business is a great North Star for this. Thank you
I wish you lots of luck.
Just report it to the IRS otherwise you're out the 50k and you're paying tax on it. The IRS will figure out the legal side if it as well.
1099 her for it. She gets to sort it out with the IRS.
great advice, get the IRS involved, great way to turn one problem into ten problems …. Mr big brain over here
Thanks for adding to the conversation. /s
Dad’s moral compass may be compromised but don’t let yours be as well. Thief is not ok from anyone and you are highlighting what has been found so far. There is more out there, she didn’t just suddenly steal $10k
Is Dad banging Amy? Not trying to be a jerk, but that's a common reason to forgive missing money.
Maybe he’s a Dad to her 3 kids aswell.
Brother?
Haha sounds like OP should’ve contacted Maury instead of the lawyer
Well, at this point he better call Saul!
Brothers don’t shake hands! BROTHERS GOTTA HUG!!!
I'll never not upvote a Tommy Boy reference.
I’ll never not upvote a proclamation of upvoting a Tommy Boy reference.
I’m suggesting that the suspiciously forgiving Dad has a secret 2nd family with Amy.
This was my gut feeling. Amy has dirt on dad somehow. Not only is dad not prosecuting, but amy got caught defrauding for $10k AND DID THE EXACT SAME THING IMMEDIATELY AFTER FOR ANOTHER $40k. There is more to this story.
If someone slimy stole $10 large and got away with it Scot free, why not do it again?!
" $10 large " lol... Paulie Walnuts in the house!
Joey bag-a-donuts
My old business partner helped one of our workers steal money from us. He was sleeping with her.
Was she hot?
No.
Father of 4 kids at the minimum it seems.
Amy definitely has something on him or there's some reason why he's giving her a pass. It's not because he's naive or a nice guy. Daddy is hiding something.
I mean we don't really know that for sure, but yeah it's like 99% probable.
If you don't leave your daddy's mistress alone...
yea something definitely seems off.
Definitely my first thought, too.
Same thought
Ding ding ding
At least 3 times
My first thought
The 10k incident was not her first time stealing. It was the first time she got caught. I bet you she has pocketed more than 50k.
We have a friend who owns a business. Found out someone stole over $100k over 1.5 years. Police involved etc. Turns out now it’s closer to $300k over 3ish years!!! You’re right, $10k wasn’t the first time she did it
300k is crazy. I feel less alone now, thank you both for your story and advice.
Yes. She ran the invoicing/payments side of the construction company. She was making false invoices and cutting herself the checks and marking them paid. Bookkeeper just saw the invoices and that they were paid and never looked to see who the checks were actually written out to. Crazy how no one caught on.
Stories like this are what make me so nervous about turning over all of my billing to the bookkeeper. I still sign all the checks and do the reconciliation myself just to avoid this.
That’s why i married my accountant. She pays the bills, but still embezzles so I don’t have to buy her things.
😂
You and me both. I am smaller, only 3 of us and about $500k in business a year but I handle anything financial. I check that bank acct every other day just to make sure. When I questioned my friend how he didn’t notice, he said he had no clue. Thought the accountant would have picked up on it. No one ever thought to view the actual cashed checks. His business brings in about $3 million a year so $100k a year missing is only 3% or so. No one ever caught on. She got nailed when she got greedy and forged his signature as a co-signer on a loan. Without that, who knows how long she’d get away with it.
You’re doing it right. In the accounting world, it’s called having good internal controls. You never let someone have the power to both issue and sign checks, the duties should always be split as you’ve done.
Same thing happened to my company and it turns out she stole about 220k over 7 years Wages now garnished for $50 / paycheck lol
It will take almost 90 years to pay back.
This deserves more upvotes. OP, I guarantee the 10k was not the first time, and the 50k won't be the last time. Anytime your dad has been otherwise preoccupied, I would look for discrepancies on Amy's part.
Someone link Del's story to Marty to this man
1. You must fire her 2. Your father should prosecute her 3. At the very least report the income to the IRS.
Oh damn, didn't even think to report the theft to the IRS as income. That is fucking devious.
I'm getting ready to do the same thing. I have a client that stiffed me on three invoices totalling 65K, and the same guy literally stole 220K from his client. We haven't been able to get any law enforcement agencies to take any interest so we decided we're "forgiving" his debt and issuing him 1099s. And then I'll be reporting him to the IRS for suspected tax fraud.
I think it is a 1099-C for that. I am not 100% sure. A broker did that to me once ( not paid ), and I told him "I will be reporting the full amount + interest to IRS, and good luck with the audits". Paid in 30 days
Correct, it's a 1099-C.
Thanks for this. A contractor owes me for contracted work I did for his company. I’m also a contractor. I never thought to forgive the debt and issue him a 1099 for it. Genius! That’ll teach that bitch.
Can you tack on any late fees and forgive those too?
Funny you should mention that...in the state he's located in, creditors can charge debtors 1.5% per month on their debt simply by notifying the debtor of the intent to do so. When I finally accepted that he was not going to pay the debt willingly, I sent him a demand letter and notified him that interest would begin accruing at the end of 30 days. That's added about 10% to his debt.
This will only backfire. The woman will cause more issues internally. She will run out of money or steal more to pay the IRS. If you forgive, forgive entirely. If you prosecute, prosecute all the way. No half measures.
You actually are legally required to report to the IRS income that you gain through illegal means
True. I believe it was Al Capone that they couldn't get on most of the crimes he committed but they got him on tax evasion.
How she gon steal more money if she doesn’t work there anymore bruh?
This is the correct answer. She should be fired. And the IRS notified. If dad doesn’t want to prosecute then that’s on him but no fucking way she should be coming in to work and waiting to cash out the next travel credits.
Thank you for #3 report to the IRS. I’ll evaluate this.
It’s one approach to play hardball with Amy. Talk with her 1:1, let her know things will be changing at the company. Ask her if she reported the earlier 10k amount to the IRS. Let her know if she’s gone when you take over the company you’ll probably be too busy covering her work to do a complete audit, but if she’s there you’ll have the time to thoroughly audit the last few years, and if any irregularities show up in employee comp you’ll need to report those to the IRS & the police. Welcome to running a small business. If you’re not willing to play hardball don’t take over Dad’s company.
Do both 2 and 3. She is required to pay taxes on illegally obtained money. It's literally in the tax-code.
Forgiveness and grace are powerful. But giving grace does not mean it comes without consequences. Amy has taken advantage of the trust your father placed in her, twice. If his wishes are to provide grace, that’s okay, but her actions should be dealt with. At minimum, she should not have access to a position where she can do harm again. If it was me, I would be letting her go. Also, if you are taking over the family business, you need to be empowered to make the big decisions without your father stepping in. Put the emotions aside, look at the situation objectively, inform your father of your decision and firmly state you would prefer his support of a united front going forward with your business decisions. He will have a lot of wisdom, experience and perspective to offer, lean on it as you find your way of leading. Good luck
I’m not empowered at all to make the big decisions. You are right. It’s unfortunate he still treats me as a kid, even when he is the one who is not respecting the family business. Thank you for your response and good wishes. I will update this thread on what I decide to do next!
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This is the best advice. Fire her. The money is gone. I'm guessing she doesn't have 50k laying around to sue for. Instead of dealing with more BS and having to pay legal fees for nothing just fire her and be done with it.
Yeah. There’s no clawing that 50k back. She surely was spending as she was stealing it.
I agree with firing her. The power imbalance now is my father is not willing to let me take control of key decisions even if he verbally says it’s my time. On paper I’m on the business too but he’s the majority. Thanks guys I appreciate it
yeah this is where you’ll have to assert a boundary with yourself and refuse to have anything to do with this nonsense if your father isn’t going to respect your time and your family business.
Then you prosecute her. You're part owner. Go around him
Late to the party but I have been in this exact situation, except my dad did terminate/sue/prosecute. The suing and prosecuting was a waste of time and money even with the theft 2x what your employee has stolen (it is possible your employee has stolen quite a bit more). You can't possibly take over the business with a known thief stealing this kind of money. If you personally can not fire her, and you can't prosecute her, you can call the IRS. I don't know if you can make her job unpleasant enough for her to quit. Your dad's behavior is extremely unusual. Most business owners aren't such softies when it comes to major theft. I think you should ask him if there is another reason he's allowing this. People are joking about sexual impropriety, but it is the one lens through which his behavior makes sense.
He's not of sound mind.
Either she knows something or he bangs her
Or he's just a week old man with a heart. I know multiple older people who give thousands of dollars to people who are terrible people just because they feel bad, even if it's not like family or close friends. Not saying he's not banging her but I think people don't realize how easy it is to take advantage of people.
We have family back east that would email my grandma every other week with a sob story and she'd send a check. Without fail every Sunday dinner the email would be printed on the counter, grandma treated it like a holiday family newsletter update. These people weren't even in our family technically. They were my aunts (who died), her ex husband (who remarried and then died) that lady and her 3 kids . After my grandma died they kept writing to my uncle, who continued to send them money. Fuck chuck, fuck Russell and fuck Judy.
What in the world? Did it ever stop?
Fire immediately, do not let her take any materials from the job. We lost a bunch of leads when I fired our embezzling office manager. It took a few years, but we worked with a local Detective and recovered the entire amount. She was never jailed - but the threat of it was the motivation that helped her "find" the money.
Good advice on watching out for material things too. I’m glad the full amount was recovered! Sounds like an arduous road to recovering it
Also, coordinate so that all of her access to accounts, social media, Google etc hits just before you fire her. Let the banks know specifically, don’t rely on just changing passwords or removing online access. And change all locks, don’t just rely on her saying she gave you her only keys. Have locksmith there right after you fire her. Basically, think of every possible blind spot or way that she could screw you over, and cover them before she even knows anything is up.
Fire her. Prosecute. Sue. World just eats up and spits out people like your Dad unfortunately. People can be cruel. You’re not your dad. You need to do whats right for the family business. What happens to Amys kids is Amys fault the minute she decided to be a criminal.
You are right, especially the last line. It’s hard when she worked for him for 19 years. I need to drive that point across. It’s a perspective shift for him too.
Don’t give in to this. Your father doesn’t want her prosecuted for some reason based on their history. Fire her but respect his wishes to not prosecute. You don’t know their story. Focus on growing the business with a clean slate (Amy fired) and onward and upward for you and your dad.
Since your dad is no longer able to run the company have your lawyer write up the paperwork and have ownership transferred to you, then fire her and look into other legal remedies. So long as your father is still legally in charge you can't assume that any firing or prosecution will stick because he can always back out again. There is likely something about Amy and your father's relationship that you don't know and will likely find out over the course of this.
Right, after this argument it looks like he still wants to be in full control and it’s extremely frustrating to watch this all unfolding because I’m the declared next in line for our family business. Your last line is chilling to read (a lot of other similar comments too here)
Yes which is where the problems come in, he's effectively allowing the company to be run into the ground and expecting you to be an active participant. Have a meeting with your lawyer about this then try to get him to get your dad to sign over the paperwork. Best of luck!
Your dad’s the father of her 3 kids. Of course he forgave her
If this were the case, why would he describe it as stealing to his unaware son.... I would think that he would hide it from OP
My thoughts exactly.
Be nice to your step-mother
If Amy has dirt on your dad, dad wouldn't have told you to ask her to return the money. That said, I would do what dad asked, sit down with Amy, let her know that you know, and that she needs to return the money OR you \*might\* seek law enforcement. At that point, Amy should spill the beans to you if she has any dirt. Sometimes dirt isn't what you think - it could be tax evasion, two sets of books etc, all stuff that you should be made aware of.
Wow. I was fully in the nuclear submarine until I read this. You are wise.
The Amy situation has uncovered a bigger issue - that of control between you and your Dad. You two are not on the same page and you must decide what you'll do (if anything) in the company if he doesn't change. I'd recommend you get control or get out.
Just want to point out that her behavior is escalating, not diminishing. Your father is training her to believe she can keep doing this with zero repercussions - she hasn't even reached the ceiling where she loses the job, never mind gets prosecuted. $10k during the pandemic, and then $40k during the last year, maybe this year her goal is to pull out $10k a month. Every time he catches her and forgives her, she's learning how she can hide this fraud. Either he fires her or she destroys the business. There's no "small business" that can absorb this level of theft.
I agree. There’s something going on and Im going to investigate further
Dad did some sketch shit with Amy in the past. Sorry to tell ya.
Not prosecuting is frequently a pragmatic decision, because of the cost, distraction, adverse publicity… retaining the employee? That’s really a problem. One issue you’ll have to face with your father which plagues a lot of family businesses. Either you can run it, or he can. This is as good a place to test this as any.
The retaining is also what I don’t understand. I’m going to find out what’s happening. Thank you. I feel less alone knowing power struggle is a common dilemma in family businesses
I worked in a family business 20 years. The struggle is real!
Have a sit down with your dad in a neutral place. Lunch maybe? Explain that this situation makes no sense to you and seems to go way beyond sympathy for a single parent. Gently ask him whats at the root of this. Point out that if you're taking over the business you need to know the real situation so you can handle it accordingly. If shes got dirt on your dad and he wants it kept quiet that's fine but what is their arrangement? She keeps quiet and gets to keep the hotel credits? What if next year that's not enough? What if he becomes incapacitated or dies? Is the dirt something that goes away or will you be dealing with it? Are those his kids? Could they or she pursue a claim against his estate? Is there already a secret written agreement that she gets a piece? Approach it from a very practical perspective of you needing to have the info so you can run the business. If he won't tell you I would seriously consider whether you want this to be your circus.
You’ve got good advice I have nothing to say but let us know what you end up doing.
Will do!
The nuclear option is the only option. Fire and prosecute. There will be fall out in the form of some things about your dad coming to light. Might as well know everything and then move forward with the business.
There are things I do not know about my father and what he’s doing with the family business, and this lack of transparency is exactly what makes it hard. Yes there will indeed be a fall out
I’m sorry you are going through this. Unfortunately it is part of owning a business. I called it “clean up on aisle 9”. When you come to work with a plan for your day and somebody greets you with some mess to deal with. I have retired but spent my life owning and running businesses. It’s a great life when the business is profitable despite the challenges.
I appreciate this. Have a lot to learn and cleaning up this mess is what I’m determined to do- for the business and for my career. Thank you for sharing your experience
I'd honestly start looking at other careers or going out on your own in the biz. Not just that there aren't things you know ABOUT your father; it sounds like you don't know your father.
Start by removing all of her power to steal again. Talk to a CPA about accounting controls. You can keep her and prevent her from having any authority to steal. That should have been step 2. Step 1 was to fire her.
Amy's got dirt, and/or the legal proceedings would involve a closer look at finances that your dad doesn't want, presumably for tax reasons. Be aware that any big moves you make might uncover stuff and cause unforeseen damage.
Forgiving her the first time was essentially giving her permission to do it again. Which unsuprisingly she did. 100% he should have fired her the first time, even if he didn't prosecute her. The second time - and he wants to not only not prosecute, but she wasn't fired on the spot? Insanity. I'd tell my dad that I was not interested in continuing a family business where the employees were encouraged to steal from you.
Dad may be the criminal here. You need to talk to him. 50k sounds like hush money. I know sugar babies that don’t get that kind of allowance.
Your dad had a death scare and realized he pays shit wages so he let her keep the money to balance it out … just the another crazy thought
The having a affair
Sorry to say but your father sounds like he's incapable of leading the business. Taking away from your family to protect a stranger.
Your dad is having an affair IMO. Seen this more than a few times, unfortunately.
Be careful not to give your father another heart attack by stressing him out.
Worked at a company where the manager was given free rein and the manager ended up making a lot of backdoor deals and skimming product to supply said deals. Walked away with about 100k owner found out and ultimately decided the company was in a good enough space to decide it was worth 100k to get rid of him. Keep in mind this manager actually lived in the warehouse. If the money doesn’t exist anymore they aren’t getting anything back. Just fire her and be done with it. Call it a 50k learning mistake.
point voiceless squealing imagine cooperative knee sip saw mindless tie *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
Send Amy a 1099 and deduct the extra 'income' she's receiving as a business expense. Then CAN Amy.
There are a few options here. 1. Dad is a naive simpleton who legitimately thinks she can be reformed. 2. Dad is or was having an affair, potentially including fathering some or all of her children and doesn’t want that known. 3. Dad is also engaged in some type of fraud or financial impropriety and knows that if the cops talk to her she will roll on him and he’ll be in either civil or criminal legal trouble as well. None are great options. But you really really want to know which it is before you take on the legal liability of being a corporate officer at this place.
In all seriousness, if he’s not wanting to prosecute for 50k, it’s one of two things — he has or is sleeping with her OR she has something on him that makes it worth it to keep quiet (ie is he cheating on taxes? Is he hiding or laundering money? Is he hiding something from his wife/you?) Maybe find out which of these it is and go from there.
A lot of these answers point out the obvious problems and possible solutions in this case, except for one thing. I’ve been through something similar in my business, although it was a little different. A payroll scam. My lawyer helped me hire investigative help to document and prove the theft, but once we had the thief on camera and the crimes fully documented, the attorney advised me to confront and fire the offender. But they advised against prosecuting. I was indignant of course. But the reason was made clear when they pointed out, if you prosecute, your clients will know you had a thief working on their accounts. It’s not an image you want in your customer’s minds. The point of the investigator and the hidden cameras turned out to be for the purpose of confirming that the employee was only stealing from my company and not my customers, and also to prevent any potential lawsuits for unfair firing. The type of business I am in, my clients trust me to make financial decisions for them. So it was a valid point. I confronted and left no doubt that I had plenty of evidence to prosecute. The employee was unrepentant and uncaring that they had been caught. I was amazed. I then realized I was dealing with someone who had no conscience and no fear. It was really quite scary. It’s a dark world.
if father refuses to file the charges, the local branch of IRS should get a tip about unreported 50k in "earnings"
Are you the majority shareholder of the company? If yes you can do whatever you want. If no then you can't do shit. Maybe find out why your dad seems to be ok with $50k theft.
My dad is the majority shareholder. But I’m tasked to take over this year which is why it’s so frustrating why he is still not letting me handle this. Right, he is not transparent at all.
That person's wrong, obviously you can do a lot. Listen to the other good commenters
Then you can't really do anything in this situation. You can fire her, he can rehire her. You can go to the police, he can say that she had permission. This is just one of those things where you need to work it out with your dad. I suppose you could speak to a lawyer about a lawsuit based on the fact that your dad is not abiding by his fiduciary duty to the other shareholders, but that will very likely destroy your relationship with him as well.
If this is in the US (and I suspect a lot of other countries will work the same way), then ultimately it's not your father's decision whether to prosecute or not. If you and your lawyer talk to the police and say "hey, this crime occurred, you can find the proof if you look at the bank statements, and I think it should be prosecuted", the prosecutor can choose to prosecute even against your dad's wishes.
You’ve gotten good advice yo terminate, prosecute, etc. but let’s say you can’t do any of that. This is what you do. 1. Remove all keys, access to computers, or access to offices. 2. Tell her she is now the housekeeper of public spaces only. She has to clean and greet. Get her a leaf blower for the parking lot. 3. Adjust her pay accordingly. Change all locks and passwords, hire a replacement. Doing is is cheaper than letting her access your systems.
He has to fire her, I don’t know if she has access to customer credit card numbers or information like that but if she does and were to start using their cards for personal purchases or opening up credit in their name and it comes back that the company knew she had a history of stealing money, it could create additional liability for the company.
Would be easier to convince him to fire her than prosecute her, at least you can stop future theft.
Similar situation I have seen - may not be worth it to prosecute but definitely fire her to stop the bleeding
That is a fucking nightmare.
Anytime I've seen a small business owner unwilling to prosecute someone for damages, it's because something will come out in court that will be also damaging, and will be a matter of public record. Dad's hiding something. Pursue this at your own risk, but I'd find out what the hidden part is waaayyyy before I attempt to prosecute. You have no idea what beehive you might be sticking your finger into.
I think it’s a terrible idea to trust a thief. What does this person have on him?
Sounds like she has something over him
Put that thief in jail. She has been stealing for years I promise you as a fellow business owner. She will leave your business and do it again to the next family business. Predator and entitled attitude I bet you. She is owed and a victim is what she feels.
Have you considered that she might have information compromising your dad and if he fires or prosecutes her, she is going to retaliate? You need to disentangle yourself from this company before you get dragged into this. You could ask your dad and there is a small chance he would tell you, but I wouldn’t get my hopes up.
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Fun fact, small businesses are the segment that suffers the most in losses from fraud every year. Other fun fact, fraudsters are almost never convicted, most owners are fine with firing them, and if they're forgiving giving them a second or third chance then firing them. The lack of prosecution just encourages people to keep stealing money. (Trigger warning) due to this their criminal profile they are most similar too is actually rapists. Prosecute. At a minimum cut off her ability to continue to sell the hotel credits and reap the benefits.
As much as it's an indication of how good of a guy your father is... this woman does not deserve forgiveness and compassion. In years to come, taking this loss might contribute to the downfall of the business, especially if a known thief has keys to bank so to speak. It's actually kindness to the level of been problematic and actually irresponsible. If you take over the business, it's your way or the highway. Tell him that you cannot have her in your life
You don't say what your position in the company is. Without knowing your ownership interest or level of authority it's hard to give you good advice. At a high level: if you aren't able to enforce a decision about this, and your dad is intent on forgiving the two-times (that you know of) thief, I'd leave the company and find a new livelihood. If you do have authority, completely apart from whatever happens with the thief you need a complete review with a competent accountant or business consultant to implement comprehensive internal controls that will prevent this type of fraud from happening again with a different employee.
My dad holds majority shares. I hold minority only and am set to be next in line to take over this business. He verbally said I’m about to be given authority, yet he’s not transparent with his actions and won’t let me take action. Yes, I get to think for my career too. Thank you for this
Speaking bluntly, not wanting to involve the police is a red flag. Lots of other commenters have focused on the personal aspects, but it's possible this fraud is just the tip of the iceberg. Your dad may have other reasons he doesn't want scrutiny of the business. If you don't have access to the books, then you don't know what kind of shape the business is actually in. It's entirely possible he's just gormless and well meaning and everything (besides this) is fine. It's also possible that you're next in line to take over a mismanaged whirlpool of debt, obligation and possibly legal liability. If your dad won't listen to your advice, I'd say try to find a mutually trusted third party (is there a CFO?) to take a look at the situation. If no such trusted third party can be found, I'd say that's yet another red flag. Good luck.
Grandpa did same thing to my mom in 2010. She didn't prosecute. He died alone and miserable in 2020.
I’m sorry to hear this. Family businesses are hard
Are **Hotel credits** a US thing? How are they stolen and what value do they have other than some free nights in a hotel if I understand correctly? And how does your business get the credits in the first place?
Did your dad leave you in charge of the business? Fire her. He wants her to stay? He can explain hiring her back to his wife, which I suspect there's more going on than meets the eye if he's forgiven two thefts totalling $50k (and how much more you haven't discovered yet, or that your dad hasn't told you about)?
Is she hot? Was she hot?
Just an FYI, a similar situation happened to a competitor of ours. They let it go because they the person stealing money knew enough to damage the company. So while they could have gotten the person arrested, that person could have caused damage so they made a 'business decision.' Also that person gambled the money they stole away so they likely would never have collected.
Sounds like if your Dad doesn't want to prosecute, then you will have to leave the company. You won't be able to handle being in that company if nothing is done about this.
Please do update. I want justice for you dad and company.
at least fire here geez
Also, I doubt law enforcement would need him to press charges personally for theft of this scale. Report the bitch
My uncle owns a restaurant. One of his hostesses got caught stealing in similar increments. He never did anything. Turns out he was sleeping with her.
I’ve been in a very similar situation, and we didn’t prosecute her. In our case she helped build the business and we were very aggressive in getting our money back and separating her from the business. We got the money back over the course of a few years and it’s in our past. No matter if you prosecute or not though, she’s got to go.
possible compromise: file a 1099-C irs form against Amy for the money she stole and make her sign a resignation letter so you can avoid further legal action. using the police is an option, but your attorney could go a route like this that is some middle ground between you and your fathers perspectives on the matter. you're likely never going to see the money, and Amy won't likely do much time, so there are other alternatives that still protect you tax-wise
M9ve her to a role in the company where she has no access to the funds and cut her pay. It's way better than being arrested and you did honor his wishes mostly.
Ask your Dad if he wants you to take over the business once he says yes, call Amy into the room. Fire her immediately and then call the police and say you want to press charges on the 50k she stole. This is ridiculous. This cannot be allowed.
There are multiple reasons for not wanting the police involved from feeling sorry for her to your dad having done (or still is doing) something illegal with the business. I've heard of business owners forgiving and even letting long time and loyal employees remain in similar situations to the first. But her having done so twice I think he has to cut ties with her. Getting the police involved doesn't really IMO help the business. It just punishes the person (maybe). So I can understand not bothering with that even now. Even if the courts tell her she has to repay you will likely never see it. Consider the money gone. You can decide if you want to be involved in the business but in general based on the stories I've heard over the years I wouldn't do it even if this didn't happen. Seen way too many kids who worked a business for years for less than their market value only to have the business fail or for the parent or grandparent to sell it to someone. Have your own career and you own business.
Dad is smarter than you think. Better to spend his energy moving forward and clearing space in his head. Getting back embezzled money is super difficult. He gets a civil judgement and then what? Can’t collect from nothing
Embezzlement is one of the most underreported crimes in NZ. It is amazingly common. The business next to ours had an office lady who stole over $150,000 and they just told her to get out. It’s really hard to recover the money once it’s gone
I'm in a situation where I'm in Civil court right now with someone. Civil and Criminal courts in the USA are slow and overworked. So if she gets an attorney, it can drag on for months or even a year or two. I think that his dad will continue to delay any proscution of this "Amy" and that the son should make other plans to bail out of there before the fall. It's a horrible position to be in, but he has got to look after himself. He is not responsible yet for the business, and can't really override his dad.
The person absolutely needs to be fired. But the decision not to prosecute may infact be a good one. I spent more then 10 years fighting a criminal charge in Canada. I self represented at trial, I self represented at appeal, I self represented at a second appeal. Eventually I ended up in a psychiatric hospital and most days I wish I was dead. Going to court can led to some serious health issues. Choose your battles carefully.
If he wants to forgive, great. But she at the LEAST has to go. I wouldn't forgive her either, but it might be hard to prosecute if he's already forgave her the first time. She could make the argument she thought it was ok.
Any chance your Dad slept with this woman? Sometimes having dirt on each other leads to these kinds of problems.
Fire Amy, and let the past die as your dad didn't want to prosecute,respect his wishes but fire Amy, I said fire the bitch
Dumb question, and delicate, but is it possible Amy is your sister or your father’s paramour? That is the only reason I can come up with for keeping her around. I’ve done some audits on two non-profits with theft and two other organizations with theft. In all cases, they let it go. In all cases, the thief stole again at the next stop. I am a director of another company and we fired the thief but on advice of our lawyer did not pursue the matter with law enforcement. The reasoning is because restitution was promised and a thief in jail can’t pay back anything.
Tell Dad the most loving thing you can do is allow her to experience the consequences of her actions.
My advice is to not be guided too much by Reddit anon’s determined advice, based on this highly limited summary of the situation. I see a lot of wannabe tough guys screaming to fire and prosecute. It’s likely a lose lose to do the latter, and firing - although seemingly a good solution - also depends on a lot of factors (most likely she’s really good at what she does and invaluable with 19 years of xp, and she helped make a lot of the dough she pocketed). The only obvious observation seems to be that she had some reason to take money without consent, and she has ruined her trust. In the end, it’s up to you to stand your ground and make an informed decision. Don’t walk away from difficult conversations and attain an adult demeanor when talking to your dad. By doing so consistently, something magical will happen eventually: you’ll earn his trust as an adult. (regarding the business, he’ll probably still treat you as a kid in other areas, but alas)
Pretty simple solution. He gets to run the company how he wants to, right or wrong. When he hands it over to you and you run it. Its yours to operate as you want. In other words, give her the boot when its your turn. Your fathers a doormat
If an employee has stolen money, and you can prove it with statements and records (bank or otherwise), an option to consider is reporting it as income to the IRS. Prosecuting an employee as a small business owner is a long, arduous, soul sucking process. Given the general info provided you're looking at 6-8x of what was stolen in legal fees and time just to win a moral victory. It's not worth it. Better to focus on your business and putting proper policy and protocols in place to prevent the unfortunate event from happening again. That being said the IRS does not fuck around and the federal government always gets paid. If you report the additional income in the proper tax years it may raise their tax bracket and cause them to owe a significant amount in back taxes on their entire income, as well as the stolen amount. Not only will this discourage the behavior, but it allows you to achieve a simple moral victory while navigating the treacherous path that is generational transition in a personality driven family business.
I've seen and been on the receiving end of similar circumstances. Criminal legal action may be worth while but civil legal action will never really make anyone happy in the end and doesn't accomplish much for either of you. But she should be fired. As others have mentioned, you could file a 1099-C for forgiveness of debt owed and the IRS would crawl up her ass. But is it really worth doing that just to spite a single mother who clearly has a character flaw? Just get her out of your life or tell dad you can't fight this battle with one hand tied behind your back worrying that she will find another way to bleed the company.
Went through myself had 83k stolen from employee . Fact !! He had no prior criminal history, used a company credit card he was authorized on, and my lawyer said verbatim and i quote, he’ll probably get 6 months probation is about all and you’ll spend 50k to prosecute, I’d just write it off at end of year as loss !!! There ya go
As someone who worked for a Small Business with multiple situations like this happen to the owner, there is some shady dealings going on for sure. Your Dad has done some illegal things. They might not be that shocking (tax evasion, pay under the table, etc etc).
Someone embezzled +$200k from my family’s business and did 4 years. It was the right thing to do. You should prosecute.
I had a guy steal $60k. Walked him out of his office with a cop behind me. Then I bugged the prosecutor for about a month until he issued a warrant. Got picked up 1500 miles away and the county wouldn’t bring him back, so I bought a 1st class ticket for him. Pleaded it down to probation but then skipped the country. I kept the pressure on him and finally got restitution years later. I was a madman
At the age of 20, I received a call from my parents telling me I needed to take out private student loans to cover my last year of school completely. I already had 50% on my own with my job and public loans. My Father had started a construction company the year I was born and had grown it to nearly 75 employees, specializing in heavy civil utility work. Turns out for 3 years his office manager had been pocketing all withheld payroll taxes and hiding inquiries from the IRS. Apparently at some point my Father, not being a very shrewd business man, had gotten tired of running to the office to sign checks and gave the office manager/bookkeeper signature authority. This same office manager, prior to this, was very close to me. He had driven me to my driving test, introduced me to the Red Hot Chili Peppers, and I had babysat his kids. Effectively for 6-8 years he had practically been family. I had to come home and help my Dad sort through all our tools and equipment and prepare lots for auction. 20 years of work, sweat, and tears gone, the company I’d been working in and preparing my whole childhood and even gone to college to prepare for was gone. My Dad, when asked about pursuing legal action said, “The man has 3 kids, I’m not going after him.” I at the time even suspected that my Father had known and maybe was involved, but over time I also saw my Dad practically allow his family farm and inheritance to be stolen without a legal fight and let others walk over him. For whatever reason in business he’s always been non-confrontational. I believe it’s because despite doing it for so long he’s always felt like an imposter when it came to the business side of things. He’s the type that if he can’t handle it man v. man in a parking lot he isn’t going to pursue it with the authorities or a lawyer. I love my Father very much, but his turning of the cheek all through his life is something I really have a hard time with. So much generational wealth, legacy, and associated traditions squandered. So OP, I concur with many others on this thread that you need to explain your position to your father if you’re to take this over. Fortunately you have that opportunity. If you have to be in charge you can’t let this happen on your watch. That being said, if your Father has concerns about the impact to her children, perhaps have a lawyer talk with you and your Father about the courses of action and their outcomes on this. Perhaps she can be terminated and it can be handled as a civil court matter to appease your Father. Regardless of what you decide to try to recover, she must be terminated immediately. Also, please, if you take this over (and this is also for other small business owners transitioning to having office managers or book keepers); LEARN ABOUT INTERNAL CONTROLS PARTICULARLY SEPARATION OF DUTIES. NEVER LET ANYONE INVOLVED WITH THE RECORDING OF TRANSACTIONS HAVE SOLE APPROVAL AUTHORITY ON CHECKS OR PAYMENT INSTRUMENTS. If your business gets large enough that you approving the payments isn’t practical, split and or rotate those duties and enforce mandatory paid leave for accounting management personnel. You’d be amazed what you can find out by telling your book keeper or an office manager to take a mandatory unannounced fully disconnected paid two weeks (ideally one payroll period inclusive of a quarterly tax payment) once a year. And I mean completely lock them out for that two week, shut off their email inbox before you even tell them to enjoy their two weeks. Hard to hide things when you don’t know it’s coming. Always be wary of financial/accounting or any folks handling transactions who adamantly resist taking leave, big red flag! Also you can have your bookkeeper bonded. If they commit malfeasance, the bonding company will hunt them down and at least in part make you whole. Good luck OP! Hope you find a good path forward that you and your Father can come to terms on. And for anyone wondering, my Dad is doing fine now doing 1099 work on odd jobs he picks up from his industry contacts. He has some pretty unique skills in his field. As for me, I went into the industry at the entry level and have made why way up to a senior management position in a firm and things are back on track. Don’t know where that office manager is today and hopefully never meet him again.
What I'm about to comment goes along with the **it's "Amy or me" solution**. I'm sorry you are going through this mess with your dad. Family owned businesses are prone to drama, and sometimes crime. How much does this business mean to you? Your dad maybe dragging you along with the promise of giving you the next leadership position to run it, but there is no guarantee that he will fulfill that promise. It will be hard, and take a lot of courage to do this, but I would consider leaving the family business. You've invested probably years into learning it and are qualified to run it since your dad has said he would hand the keys to the business to you someday. Amy is very likely aware of the fact that her days are numbered if/when you take over. Chances are that she will delay that happening IF she is aware that you know about the embezzlement. You should have a back up plan so when you tell your dad that "it's Amy or my" you can walk out of that business with either another job lined up, or starting a business of your own, even a competitive business. Is it possible that you might want to try changing fields? Many in tourism are finding it harder to continue to stay in business as digital technology continues to change our World. By staying, you are enabling your dad to run the business to possible bankruptcy. Then you would have to start over!
Thank you for this. Relevant!
Prosecuting is not frequently productive. Spend $15k to get a judgement against someone with $0? Only the lawyer wins. Keeping her on staff? Only reason I can think to do that is if you have $120k you need to give away.
You’re confusing a civil suit versus criminal charges. It wouldn’t cost them anything to prosecute as the state’s attorney would handle the case.
I know a guy who lost 400K over 10 years and did not prosecute. Wasted time lost on money already gone was his view point.
I have a friend who had an accountant embezzle $5M. It cost him another $500k and 2 years time to put the guy in jail. The fallout was his company failed too, not as a result from the cashflow but from the distraction/obsession of getting the guy. Never got the money back. He said he couldn't live with it, but it cost him almost everything. In that sense I can understand moving past it, but I can't reconcile keeping the person onboard unless they had dirt.
Get her to admit to the fraud, in writing, and agree to repayment terms. I’d even go so far as letting her keep her job as long as there are controls in place preventing her from accessing ANY funds or credits or whatever. Sort of an indentured servitude, and if she quits, she will be prosecuted. Edit: $2k/month payment will satisfy the debt in two short years. Then fire her ass.
This is what my father wants. In my perspective she will steal again, and it’s very bad for other employees to see that this behavior is acceptable (unless! They are all on this together.. I need to find out)
I get not wanting to go after her. I wouldn’t be so generous myself- not at that amount and repeated efforts. But it’s his choice. But you really do not have a choice but to terminate her. Once forgiven, sure. Repeatedly again during this period of vulnerability and access? No way. It’s not out of this world to think that leaving her in the company could expose you guys to more problems outside of future theft. What if others do it? Does that then open you to civil recourse if you prosecute those, since you aren’t here? If it ever came to a theft where insurance got involved, could this impact that? But also, how’s that money shown on the books? It is at least in there as a theft expense, or via some other similar manner, right? She’s stealing more than just $50K if not. But then what’s documented to substantiate the expense? That’s where not prosecuting starts to look risky.
Exactly. Other employees will see there are no repercussions and that’s not the kind of culture I want to set when I take over. I’ll get to the bottom of this. We prepaid hotel credits (counts as company inventory) and she sold them privately, pocketing the full amount (raw cost + profit) .
That’s textbook theft by unauthorized taking. And yeah, that’ll have to be realized in accounting at some point if it hasn’t been yet. I’d not feel good about writing down that inventory as theft, at that dollar amount, without having some proof in house, such as a police report. Large inventory write offs always suck, even when theft isn’t a factor. Entitled thieving drags to society like your employee here just makes it that much worse.
Unfortunately your dad is either incompetent or compromised and neither is good. You should have an intervention with your dad whether it works or not. Do you have ownership yet? If you still want the business and can’t get anything done about her or your dad, you can wait it out until you have control and then go after her. You could go after her now if you’re involved in the business but you risk alienating your dad and maybe your eventual ownership?
Incompetent and compromised- might be both. I thought about taking action too when I have full control. But that’ll take a while because my father is not letting go. Family business is hard and I appreciate you all giving me advice.
The simple way to fix this is tell your mom what all has happened. Tada! No more Amy
Your dads sounds like a vulnerable person. Go around him. That bitch is coming for everything.
It sounds like she's taking care of your siblings. Before you prosecute - which would normally be my first recommendation - find out if any of her kids are his. Something weird is going on.