First Response When a Concern Arises

01Do not confront

The single most expensive mistake a partner can make is to confront the suspected party before the evidence is preserved. A confrontation is a warning. Within hours, paper is shredded, files are wiped, and the clean version of the books is rebuilt over the version that told the truth. The scheme does not end — it relocates.

If you have already spoken, stop. Assume the perimeter is compromised and move immediately to preservation. Say nothing further about the subject until counsel tells you to.

02Secure what you already have

Before you look for anything new, protect what you already possess. Copies, not originals, moved to a location the suspected party cannot reach.

• Copy every financial statement, bank record, and tax return you can lawfully access to an offsite location today.
• Export the general ledger and trial balance in their native format; do not summarize.
• Screenshot anything time-sensitive — a balance, a pending transfer, a user list — with the date visible.
• Open a private email and a private storage location the business does not control.
• Retain counsel before you request a single record from a third party.