Unauthorized Business Bank Account opened of my corporation by a member of my LLC

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Unauthorized Business Bank Account opened of my corporation by a member of my LLC

Post  ma.admin on Tue Feb 19, 2013 7:31 pm

I hope you all are doing good. I went to a lot of forums and I could not find any help any where else.

I was the sole owner of an LLC. But due to my heart condition (had multiple heart surgeries) was unable to operate that LLC to make it profitable. I made my business manager a 50% member of my LLC as he was increasing my business and I had verbally agreed with him to make him a business partner and member once the company achieves a certain revenue. There was no doubt my business manager performed good and got my business to that revenue level and I kept my word and made him a member. I only had one business bank account for my LLC and I also made my business partner an authorized individual on my LLC bank account. A few months down the road I found out that my business partner has opened a separate account in another bank without my consent and knowledge and had all the LLC receivables directed to that new bank account. I went to another branch of that bank to confirm this information. I found out that was true. There was a bank account of my LLC in that bank and with even my name on it. I told the branch that I had not opened the account and asked to look at a statement. She refused and asked me to go to the Police station. Before going there I called the other member of my LLC asked him about all these affairs and told him that I am going to the local police station to file a criminal complaint. I filed that complaint with police and the next day the other member filed a Civil Law suit against me for defamation, as I had filed a police case against him. Police told me since there was a civil law suit, they will have to close the criminal case.

Now, I had invested pretty much all my money in my LLC. My money was being used to pay all the expenses of the agencies and all the receivables were going in the other account. I lost close to $150 - 200K. The other member claims he has zero money on him.

My question is can I hold the bank liable for opening a business account without my consent? Since every bank has to verify members information with IRS and all members have to be present, then didn't the bank showed negligence in opening the account. Has there been any cases in the past of such nature.

Please if someone can put some light I would really appreciate it.


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Re: Unauthorized Business Bank Account opened of my corporation by a member of my LLC

Post  JoeC (McGruff) on Sun Feb 24, 2013 4:59 am

Do not have any idea; this is an employment/labor law blog.
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JoeC (McGruff)

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