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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Business Law
Satisfied Customers: 41221
Experience:  Run my own successful business/contract law practice.
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In the past 6 months I entered into becoming part of a corporation

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In the past 6 months I entered into becoming part of a corporation with a person who is my friend. I had some money from an inheritance at the time and he wanted to start a taxi service. Please understand, I am not a stupid woman. I honestly thought I was doing a good thing. However, within 2-3 months of buying everything from uniforms to insurance to a required corporate book and SO much more, many of his personal bills, credit cards, my name being the only name on all of the financial records and being out $14,000, I am feeling very uneasy. There has been little to no attempt to pay me anything. He says he owns the company. The bank says I do. There is no official paperwork between him and me about anything and he will not sign anything. I realize financially I am screwed if something happens. And yes, he has done time for writing bad checks--but now he's got me to write them. I am really worried. Thoughts?
Thank you for your question.

The best and most smartest decision would be for you to formally incorporate yourself as the business head, and send that information to Missouri Dept of State. That will make the business formally yours, as it would then protect your own investments (it sounds like you are the only financial person and the only one who made any investments into the business as it stands).

Then, contact the bank to make sure that he is not listed as someone who is able to write checks on the accounts. That will keep him from being able to possibly write a check on the business for which you become responsible and he takes the money. Then, once everything is formally under your control, you are free to negotiate with him for terms...but at least at that point the actual business would be protected as would your reputation and finances.

Edited by Dimitry Alexander Kaplun on 11/4/2010 at 1:22 AM EST
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