Legal Question in Business Law in Kentucky

Re: Business Practices Law

It is not possible to give you a clear legal answer to your inquiry without a more detailed evaluation of the facts of your case.

Cash transactions, even involving large amounts of money, are certainly legal. But, you are right to be a little suspicious. In the custom and usage of your business, cash transactions are probably not the norm. It may be that your vendor is cheating his partners, or is at least cheating the Internal Revenue Service.

To protect yourself from any accusation of aiding and abetting, you should document each transaction with a detailed written invoice, and should have the vendor sign a receipt for any cash paid. You should also obtain from him his federal and state Employer's Identification Number, and send him a Form IRS-1099 at the end of each year.

If he refuses to give you a detailed invoice, signed receipt, or his EI number, he is not the sort of person you should do business with; unless you want to spend a lot of time in criminal court.

You should not take any action, based upon my advice, without consulting an attorney and explaining all the facts to him. You are best advised to seek the services of a competent Kentucky attorney. You can telephone your local bar association for a referral, or can find a good lawyer on-line at the Kentucky Bar Association's Lawyer Referral Service:

http://www.kybar.org/Default.aspx?tabid=291

Good luck!

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