View Full Version : Family Owned Company - Legal question

03-17-2005, 11:23 AM
If this business was owned by a family and had 50+ employees, can one of the family members (not the owner but a CFO and a family member) purchase stuff through the company and then turn around and sell it for a personal gain for themselves? Shouldn't that money go back into the company to pay for it's debt or original expenses? This doesn't seem fair to all the employees of the company that receive profit sharing etc. etc. The owner does not know this is going on, but I'm not sure he'd be okay with it. I believe the original expense is deducted on taxes, but the money gained from the sale is not. Any ideas?

Is this legal to do for a family owned business?

Oh, and we're talking $1000's of dollars here...