You might think you know your prospective business partner, but would you be willing to bet everything you have on him or her?
If not, check them out thoroughly.
That includes checking references and credit scores. It can also be a good idea for each of the partners to agree to submit to a criminal background check.
“Criminal background checks, reference checks, vetting the resume, and then even asking them if they’re willing to share their personal tax returns for the past three to five years, that will give you better insight into whether they’re able to manage company funds, and what their personal history looks like for managing their own income,” Tarshus said.
If your partner is unwilling to open up, that in itself might be a red flag, experts say. You should be just as open in sharing your information
“If a person is unwilling to share or be vulnerable with you or let you have a look into their private life, then it would really give me caution to enter into a business relationship with them,” Tarshus said.
Smith and Shin had met while working at a different lead generation company in Southern California. While it is unclear how much due diligence Smith did before the two went into business together, he did take precautions, including hiring his own attorney.
But Shin, a skilled imposter who cultivated an image as a churchgoing family man but in fact was an embezzler with a gambling problem, structured the business so that Smith’s ownership was just below 50%, unable to access the company’s accounts.
Eventually, investigators told “American Greed,” Smith became suspicious. He demanded that Shin give him the passwords to the company’s bank accounts, as well as co-signing authority on any checks for more than $10,000. And he emailed his attorney about the mistrust of his partner.
“We need to make sure he doesn’t have room for fraud,” Smith wrote.
Soon after, Smith was dead.
See how investigators finally uncover Ed Shin’s trail of deceit, embezzlement and, ultimately, murder. Watch an ALL NEW episode of “American Greed,” Monday, June 28 at 10 p.m. ET/PT only on CNBC.https://idonotknowhow.com/american-greed-how-to-avoid-getting-burned-by-your-business-partner/How ToAmerican films,Attorney,bank accounts,Business Finance,Creative works,Death Valley,Ed Shin,Ed Shin's trail,Films,Greed,List of Characters in Summoner's Greed,Smith,southern California,Tarshus