- Startup founder (49%) owner wired $300,000 of our investment into an external account and is not responding to our communications;
- We have reason to believe this person did so intentionally;
Is this a crime? What actions can be taken?
Not Monday but today go to the police. Have a one page summary. Keep it short and have no more than five exhibits, probably bank account statements. Refuse, just refuse to be told by the police that this is a "civil matter". Then go and find a business litigator over the weekend and meet with them on Monday. Or, ... kiss you money goodbye. All delay works against you.
The above is general legal and business analysis. It is not "legal advice" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts...
Well it is pretty hard to initiate a wire transfer on accident, so I’m glad you have gotten that far in your investigation.
I would be shocked if you invested hundreds of thousands of dollars in a company without having a lawyer involved, so you should talk to that attorney. If you made the mistake of doing all of this on your own and have no attorney, then get one. Your issues are well beyond a general legal question and answer forum. In the meantime, I would immediately send certified letters to the financial institutions on both sides stating that this wire transfer was done illegally and for them to either freeze the money or return it. Maybe you will get lucky and at least get the money locked up.
Please DO NOT message or phone me with further questions or comments as the discussions would be outside this forum and would not be visible to the public (the only exception to this being for serious prospective clients). If you have additional follow up questions or additional facts to add, re-draft them into a new question and repost it. My responses on this website DO NOT constitute a consultation, nor do they establish an attorney-client relationship. Only a written retention agreement signed by client and myself will establish an attorney-client relationship.
Embezzlement is both a crime and a civil wrong. Your remedies for the civil wrong or actually quite strong as you can possibly get a pre-judgment writ of attachment so that he cannot do anything else with the money while the lawsuit is pending. But make sure you hire somebody who really knows his chops because this is a tricky maneuver but a powerful one.
This is general advice. You are anonymous. If you PM me i won’t know what it’s about.
This situation raises numerous legal issues, including potential criminal activity. As the distinguished counsel on this forum have stated, you should take action immediately to address these issues and protect the company's legal rights. There are procedures for freezing funds through the legal process prior to full adjudication of a civil claim. You should not rely on an online Q&A forum to address these issues.
The information contained herein is provided solely for informational purposes, and should not be construed as legal advice on any subject matter. Any information contained herein is not intended to be a substitute for legal counsel on any subject matter.
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