WWYD DH lending money again

[KatieMorag]

Dh has a long hiistory of lending our money to mostly family and friends without agreeing this with me first. Sometimes it gets paid back , sometimes not. We've had many many rows about this. He promises faithfully that he won't do it again. Then he does

Usually he lends money to his family. I don't mind if (a) we can afford it ( b) we get it back and ( c) we agree it between us. Sometimes we give money to family too, on the same conditions. This is because we are fortunate to be better off than most of our siblings.

About 10 years ago he borrowed £10,000 to lend to his sister. She never repaid it and it took us years to pay off the loan.

Last year he gave her £1,000 because she said she was in debt and couldn't pay her bills. She then took the money and went to Australia for a months holiday.

Earlier this year he lent a large sum of money to a colleague. By large I mean what I earn in a year. Today I discovered by accident that he's now lent this person another £10k.

I am so angry and Upset I can't even talk to him. It's not just the money, it's the lies , the deception and the broken promises. I don't know what to do.

[diddl]

I´d have to leave him on the grounds of his utter disregard for my wishes & his twattery with money.

[Houseofplain]

I was with one like this. No good will ever come of it. He's irresponsible with money, too busy playing the big I am.

If I were you I'd get an accountant to look over the companies portfolio and commitments and yours. Men like this have a habit of taking out loans you could be liable for, or outright fraud. So make sure your accountant is shit hot. As it will save you later.

[KatieMorag]

I cant just resign from the business. I own a third of it, it's our only source of income as a family, the money in it is needed to put my kids through college, it's our pension and most of our savings. Like most small business owners, the salary I take doesnt reflect the hours I work, it's there in the work in progress and the goodwill.it's not like quitting a job where you walk away with your wages, it's like quitting a job where you have only been paid half your wages for the last 15 years and now you will never get back the other half.

I know it's never easy to disentangle two lives but when you own a business together it's even harder. I can walk out of the marriage easier than the business

I can't even believe this is happening . It's just madness

[diddl]

Well if he keeps up like this-you are probably both going to walk away with nothing-at all!

[tribpot]

I don't think you need to walk out of the business, but what would you do to protect your assets if the other partner was just a friend or even solely a business acquaintance? You'd go and sort out what the hell your liability was for this financial imprudence, you'd certainly ensure that two signatories were required and I think you'd be looking at how to limit the other partner's ability to direct the finances of the business on a day-to-day basis. I'm sure he works hard for the business but he's clearly not financially prudent enough to be in the driving seat.

I think you then need to look at how you reinstate your 50% share in order to separate finances more fairly in the case of a divorce. Playing around with shares of the business to minimise the tax burden is a game for married people who can trust each other implicitly.

[CogitoErgOlympics]

If you weren't married to your business partner and he was behaving this way, you would be taking him to court. I think, whatever ultimately happens with your relationship, you need to get some legal advice on how to protect your income, your personal investment, pension, college fund and all the other things you mention. You have to get hard-nosed about it.

[CogitoErgOlympics]

x-posted :)

[Houseofplain]

With all due respect. Unless you sort this out and get a good accountant on the case. You do not know what state the business is in. Or what else he's got you potentially liable for. You may have nothing, it may all be built on sand.

It's not wise to be in business with someone who is so irresponsible and I would say fraudulent with experience. As they will never change and there will be a time when they destroy everything. I knew two men like this, both are now bankrupt, without a business.

[bleedingheart]

Did he make the offer to his colleague or because he was asked? If the latter I'd be very wary in assuming you'll get it back. He has no respect for you and your children; lending more money to his sister after she failed to pay the last amount back. The sheer front of her leaving you to pay back £10000 and ask for more! He hasn't learnt from this. Protect yourself, see your accountant. He needs counselling or he will lose everything, financial and personal. I can't begun to imagine how hurt and angry you are, this is so disrespectful, dishonest and stupid.

[StarryCole]

OP you need to obtain financial control away from your husband. Please start making calls immediately and get good financial advice. If possible draw up some legal paperwork to protect your assets.

Don't delay.

Sort out the mental shit later and start getting a list of actions.

Op men like your husband will find it extremely difficult to change. I know this by experience.

Don't waste another day dithering if you are in the wrong. You are so not.

[KatieMorag]

Tribpot, we didn't okay around with the shares of the business to minmise tax, we were told to do it by the accountant because of HMRC rules, that we couldn't own it 50:50 when dh earns much more than me.

I do in general knwo what state the business is in as I have access to all our bank accounts and management accounts. We have a financial controller too who is not involved in this.

You are all right that I need to get more hard nosed. I will phone the accountants today

[tribpot]

KatieMorag - I wasn't trying to suggest you'd done anything underhand, but now I see this slightly differently, that it wasn't credible to HMRC that one of you was withdrawing a vastly huger salary than the other based on equal holdings in the company? Which now leads me to wonder why you were drawing such different salaries?

[StarryCole]

Fyi - i been where you have and I went hell out to wipe the floor of my husband's reputation by publicly announcing to his friends and family and shaming him. I wrote and called them all and put shame on them. How dare they have my money when we couldn't pay roof over our heads? You are no bank. You are not responsible for their welfare.

Feel free to put in a sob story. People will no longer...

[HecateHarshPants]

I think that, if you're not going to leave, then at the very least you should say that as a condition of you not leaving him, he has to remove himself financially and hand over all control to you, so no more bank account access, no authority to write cheques, nothing.

Business and personal.

[CinnabarRed]

BTW, be careful with your accountant. I think you've been given duff advice on the 70:30 ownership split, assuming you work full time in the business. Your accountant is talking about the Arctic Systems tax case, won by the tax payer and subsequently legislated against by HMRC, but I think s/he has misunderstood the implications for you.

[Chandon]

OP, OMG!

I would be furious.

My mum always had the rule to either GIVE the money (if you can truly miss it) or not, but never to lend ("Neitehr a borrower nor a lender be..".what's that Shakespeare quote again?).

It must be tricky to get out of this pattern, as clearly friends and family see you and DP as a cash point.

No more joint account maybe?

You do not owe family money just because you are earning more. Things can change, you could lose jobs, saving makes sense.

[Houseofplain]

Access to the accounts great. But you by no means necessarily know, how much he has "loaned" or "borrowed" against the business. THAT is what I'm trying to tell you. It's no good having 100k in the bank. When you find he's taken out a dodgy loan for 200k or not paid the tax bill.

That's why I hope you've got good back up, who can really do their job amd uncover everything.

[MushroomSoup]

Just thought of something else.
Your DH seems to be able to completely disassociate the two 'parts' of you - the wife and the business partner.
He doesn't feel he needs his business partner's approval to make a loan and he chooses not to involve his wife because his wife says no.
You seem to see them as intertwined (as I would) as in the personal/business lines have both been crossed.
If you completely disassociate from the personal and act as a business partner there is no way on earth you would allow this to continue and you would be seeing an accountant pronto.
The marriage side is less easily sorted, sadly.

[ImperialBlether]

MushroomSoup is absolutely right. He treated you as a wife when he agreed to the loan, not as a business partner.

Treat this as though you were in business with someone who wasn't a relation or even a friend and get a good accountant onto it.

The trust issue would be huge for me, I have to say.

[startlife]

Forget the husband/wife aspect of this - as you're a director of the company I would have thought he should have cleared his level of loan with you. Does your DH feel he is the overall boss of the company and you are the token shareholder? This for me is the fundamental issue - if you are an equal partnership he shouldn't do this without consulting you. I would agree with seeing the accountant and getting agreement on the level of financial commitments one director can make without consultation with others.

On the issue of why he's so generous - there is an emotional payoff for him - as you say, most likely to enhance his ego. I have seen generous bosses before. My brother is one, he gives very generous loans to employees but he does so to retain them, to provide a unique 'benefit' of working for the company and to encourage hard work. It does work and he's not been let down. He does however get paperwork signed up. To do otherwise is naive.

[MNsFavouriteManHater]

you have to put aside your reluctance to humiliate him

he hasn't considered that when he has lied to you, and put your financial future at risk to inflate his own ego, has he ?

you have been treated as nothing more than the Tea Lady, I am afraid (business wise) and as an irritating thorn in his side (personally)

[LeandarBear]

Are you able to speak with the employee, he might be oblivious to the problems he has caused. He might just think your husband has lots of surplus cash.
It may be a bit embarrasing but, if he is in any way decent he will hand the money back or, at least be willing to sign something to make the loan official.

It is much harder to do anything about family scrounges

[KatieMorag]

Thank you all for the good advice. I have an appointment with the accountant today. What should I ask him?

Re artic systems case -dh brings a lot of money into the business because he is fee earning at a very high hourly rate and he works many hours a week

I am only part time as we have 3 young kids and I'm not a fee earner.

If we worked in another company he would earn about £250k or more and I would earn about £60k at the most. so I didn't believe that we both contribute the same value to the business. I mean in a financial sense, not a moral sense-obv he can only work these hours because I Look after our home and kids

Most of our income is not salary, it's dividends. If we own 50:50 we get the same dividends, even though he earns a lot more. We were advised this would cause problems with HMRC

[CogitoErgOlympics]

I would simply explain the problem exactly as you did at the outset and see what your accountant suggests. In many organisations, for example, there is a cap on how much expenditure can be approved by one person and what level requires a second signature. i.e. yours. If he's using company money you should be able to structure things so that he has less freedom. If he's using personal money that's far more difficult to control