I own 25% of a CC with two other fmily members owning 75%. I am a silent partner but the accounting officer and rely on accounting records prepared by the other members who manage the business. I recently discovered that the other members had been putting personal expenses through the business (a medium sized franchise restaurant) in the amount of some R 750 000 to R 900 000 per year, and were deducting these for VAT purposes, when they did pay VAT. This also created a large loss and the business was looking insolvent but they kept paying these expenses. As this had resulted in a material misstatement of the financial statements, I redid the financial statemnts for the past five years, transferring their personal expenditure to a loan account. The result is I have a credit loan (lent to the cc) of R 750 000 and they have a debit loan (owing to the cc) of R 3 million. I know they have been trading recklessly and trading under insolvent circumstances and have committed tax evasion (company tax, VAT and personal tax). Is there any way I can take over their membership interests because of the imbalance in contribution (R 750k I have put in as opposed to R 3 million they have taken out). I do know that I can probably approach the High Court because of unfairly prejudicial conduct and unjust enrichment on their part and because of their rckless trading but this is expensive. I am looking for another way to take over the business because with proper management it can make money. any assistance will be appreciated.
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