Are you searching for information on what to do about misappropriation of funds or assets in San Diego or anywhere in the State California?  What does it take to prove misappropriation? What action(s) should you take if you believe a business partner, shareholder, member, executive, employee, contractor or supplier has misappropriated you company’s assets or money?

Key Takeaways about How to Handle Misappropriation of Funds or Assets:

• The person who misappropriated funds or assets must have used their relationship with your company in order to do so, and must be in possession of the funds or assets.
• The person you suspect of misappropriation of funds or assets must hold a position of trust within your organization, and breached their fiduciary duty to the company.
• It is most often the best strategy not to directly accuse or confront the suspected perpetrator.  You need to seek the advice and counsel of your experienced Watkins Firm attorney to learn more about how to handle misappropriation of funds or assets.

The Elements of a Successful Misappropriation Case

One of the important elements of how to handle misappropriation of funds or assets at your company is to be able to recognize the important elements of a misappropriation civil case.  These include but are not limited to:

• The person who misappropriated funds or assets must have used their relationship with your company in order to do so.
• The funds or assets must be in the possession of the perpetrator or have been transferred through them to another individual or business entity.
• The suspected misappropriation must have been accomplished by someone who has breached their fiduciary duty or position of trust within your business.
• Intent actually plays a significant role in a successful civil case for the misappropriation of funds or assets. There may need to be a confession or the accumulation of substantial evidence.  This is why you need one of the experienced business misappropriation attorneys at the Watkins Firm.

Important Steps When Determining How to Handle Misappropriation of Funds or Assets

What are some of the important actions you should consider when determining how to handle misappropriation of funds or assets in your company?  The first and most important step is to develop a chronology of events supported by substantial documentation.  One of the first sources to check is the company’s books.  Look for inconsistencies, even if they seem minor.  “Off by a penny, off by a million dollars.”  This is an old saying we live by at the Watkins Firm.  We work with forensic accounting experts to examine the books to seek supporting inconsistencies, illegitimate vendors or ghost employees.  Our team can compare important documentation from internal expense reports, company credit card statements and bank accounts to entries in the company’s ledger.

Another issue to consider is any inconsistency in inventory.  There should be a system to carefully manage incoming and outgoing inventory as well as consistent checks of the existing inventory itself.  Investigate inconsistencies, changes in stock on hand or “damaged” discarded records.

Another important issue to consider when facing the issue of how to handle misappropriation of funds or assets is a common scheme associated with customer or vendor credits.  In this scenario, the fiduciary or trusted individual collects full payment on an invoice but issues a fictitious credit while pocketing the difference.  This type of scheme can also be applied to kick-backs from suppliers as well.

Pro-Tip: “Well, generally, a fiduciary duty is when one party has an advantage of power, knowledge, or resources over another party. And they’re doing business with each other. That’s basically where we get fiduciary duty. And then the laws have been built on that concept for hundreds of years. So you can imagine that today’s fiduciary duty lawsuits are much different than they were 50 years ago. We’ve come a long way. The laws have changed.

A fiduciary is supposed to act openly, honestly, and fairly. They’re supposed to put the beneficiary’s interest above their own, and they’re supposed to never self-deal, they’re supposed to act in good faith. Basically, not take money or take an action that is not in the interests of your fiduciary client that they don’t know you’re taking.

For example, you’re a shareholder and you find out your buddy down the street owns the same amount of shares as you, but he got twice the dividends as you did. Corporations and their board of directors and their officers have an obligation to treat like shareholders in a like, and similar manner.  Unfortunately, quite often that just doesn’t happen. Sometimes other things that happen with corporations, such as insider trading, it happens on the large market, big caps. They go to jail, things like that, but it also happens on the small market.

We see this every year, several times a year, a shareholder client comes in, (they call themselves partners), but it’s a corporation. And they say, ‘my company decided to go bankrupt. Then I found out that the principles opened up a new company over in England and they made $10 million, and we lost everything.’ Basically, these bad actors were hoping that you didn’t find out on those situations. Again, the sooner we find out the quicker we can get what we call temporary protective orders and asset seizures and levies with a judge to stop them from stealing or taking other actions in breach of a fiduciary duty.” – Dan Watkins, Founding Partner

Ask Your Experienced Watkins Firm Attorney How to Handle Misappropriation of Funds or Assets

If you have noticed inconsistencies or other apparently concerning evidence or behaviors it is important to seek the advice and counsel of your experienced Watkins Firm attorney to learn more about how to handle misappropriation of funds or assets.  It is most often the best strategy not to directly accuse or confront the suspected perpetrator.

The proven misappropriation and embezzlement attorneys at the Watkins Firm will help you to develop a strategy or investigation which develops substantiating documentation, surveillance and evidence to support your case without tipping of the suspected perpetrator.  Our attorneys can help track the money or assets and work to ensure just compensation, the return of assets and compensatory damages for what you have been forced to endure.

If you are concerned about the potential misappropriation of funds or assets including embezzlement we invite you to review our podcast Episode 25 – Unfair Business Practice Overview, as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.

Meet Daniel Watkins:

Daniel W. Watkins is a true people person who sincerely listens. He cares deeply about what others are going through.  Dan enjoys digging into the facts and finding creative solutions to problems.  He contributes his insights candidly and constructively.

Dan’s interest in people make him deeply invested in every relationship and his exuberant personality makes him a true litigator. Dan fights for his clients with a fierce and calculated commitment.

Dan has practiced in the areas of business, medical practices and healthcare business, high tech/science, real estate and employment defense law since 1987. He is a trusted litigation strategist and true trial attorney with over 50 jury and bench trials to his credit. Dan has successfully represented both large companies and individuals and achieved substantial victories in well-publicized trials throughout California and the U.S.

He is experienced in business and corporate formation and administration, as well as all forms of alternative dispute resolution, including binding arbitration and mediation.

THE ROAD TO BECOMING A BUSINESS LAWYER AND LITIGATOR

Dan has almost 40 years of experience working with, for and against some of the largest insurance companies in the country. He has successfully tried and litigated cases in the areas of Healthcare Compliance, Commercial Litigation, Unfair Business Practices, Fraud, Breach of Contract, Battery, Premises Liability, Product Defect, Medical Malpractice, Discrimination, Sexual Harassment, Construction Defect, as well as Unfair Competition, Defamation, and Trade Secrets.

In December 2003, Dan commenced litigation against Health South Surgery Centers-West, Inc and its’ subsidiaries, exposing the company’s extensive mismanagement and misconduct of its’ surgery centers. Dan has also been asked by some of California’s largest municipalities and corporations to conduct legally required investigations into matters involving alleged employment discrimination and harassment.