I was recently laid off from a company I have been with for decades after it folded due to the inability to fund payroll. As many of us started to file for unemployment, the details behind the business practices of my company started to unravel.
It appears that the main boss used company funds to build a rather extravagant McMansion for himself. When things started to dwindle with the recession and business only became more slow, he started missing payroll. At one point he even asked me and my husband if we could loan him money to process payroll that period (we, of course, said no). So unfortunately the company had to fold, and now we are all having trouble getting any sort of unemployment benefits due to the shady business practices. I don’t know how much money was wasted, but I imagine hundreds of thousands of dollars, if not millions over time.
– Submitted by: JoAnn
Lesson Learned:
Employers using company funds to fund anything personally is such a horrible business practice. Whether it’s cars or homes or whatever. Pay yourself a salary and leave money in the bank for the company to continue on with business. Yes, business owners should reap the profits of the business, but not to the degree that you could potentially put yourself out of business and lose everything. A lot of people depend on you for their lively-hood, a little discretion and practical business sense could go along way in making sure everyone benefits and progresses.
Estimated Amount Flushed Down the Money Drain: $500,000+
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