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> technically as president/CEO of a firm you are already liable for any criminal conduct by your firm/employees-on-the-job. Citation needed. Limited liability

> technically as president/CEO of a firm you are already liable for any criminal conduct by your firm/employees-on-the-job. Citation needed. Limited liability is at the foundation of the very concept of incorporation.

brianwawok 2y ago
Isn’t LL about protecting your assets not you from jail time? I can’t start a LLC, have the LLC pay someone to kill you, and be scott free. “Sorry you can’t go after me, go after this shell company and try to put it in jail ha ha”
- Joel_Mckay 2y ago
  Yep, people should talk with a real local corporate lawyer or AMCHAM if unsure. The hubris on YC from those that assume the rules don't apply to them is hilarious. But, I guess someone has to pay for the lawyers kids to get though university. Have a wonderful day =3
tracker1 2y ago
The intention is to limit the liability of investors, not those in control of the company.
- Joel_Mckay 2y ago
  Agreed, the key phrase here is _limited_ liability not immunity. I am still trying to figure out how Boeing got around their commercial insurance companies? There is a bag of vipers also waiting for their turn with the CEO for sure... =3
philipov 2y ago
Limited liability only protects the shareholders. It exists because shareholders have no control over the corporation. It does not protect agents of the corporation, such as management, because they do have control of the corporation.
- Joel_Mckay 2y ago
  This is true up to a point for shareholders, as for civil liability it is not guaranteed protection in some places. For example, if you hold shares of a firm that makes something locally illegal in another jurisdiction. =3
Joel_Mckay 2y ago
It is right on the incorporation forms prior to entity approval, and in my jurisdiction the Lawyer made this very clear as I make choices hiring ex-servicemen contractors/staff (numerous PTSD issues can limit roles... like "dealing" with aggressive/rude customers can be a bad idea etc.) Additionally, blindly using Lexis Nexis forms can cause issues too, as the same clauses have different legal definitions in different regions. While a C firm does _often_ protect board member personal assets from civil cases, it also does not guarantee protection. Also, international investors do not usually create a US LLC given it usually trips 2 tax codes. Talking with awesome AMCHAM reps about this area is probably in your best interest, but most international firms create a Type C corporation on US soil. Ask your local corporate tax lawyer about liabilities to confirm whether your jurisdiction has harmonized corporate laws. Being a president/CEO is not what most assume, and even a shareholder can get messy too. Despite pop-culture urban legends, it is not a role for clowns or cons. =3
bumby 2y ago
In the US, sometimes the court may “pierce the corporate veil” when actions are particularly egregious or unlawful and hold the shareholders or directors personally liable. Rather than go into all the specifics of law (since I'm not a lawyer), I'll cite some examples where corporate executives were charged personally: (Tax evasion): -https://www.justice.gov/opa/pr/ceo-multibillion-dollar-software-company-indicted-decades-long-tax-evasion-and-wire-fraud https://www.justice.gov/opa/pr/ceo-multibillion-dollar-softw... (Securities fraud): - https://www.justice.gov/opa/pr/ceo-medical-device-company-charged-covid-19-related-securities-fraud-scheme https://www.justice.gov/opa/pr/ceo-medical-device-company-ch... (Identity theft and fraud): - https://www.justice.gov/opa/pr/ceo-medical-device-company-charged-covid-19-related-securities-fraud-scheme https://www.justice.gov/opa/pr/ceo-medical-device-company-ch... (RICO - Providing encryption to avoid law enforcement): - https://www.justice.gov/usao-sdca/pr/sky-global-executive-and-associate-indicted-providing-encrypted-communication-devices https://www.justice.gov/usao-sdca/pr/sky-global-executive-an...
- Joel_Mckay 2y ago
  [flagged]

brianwawok 2y ago

Isn’t LL about protecting your assets not you from jail time? I can’t start a LLC, have the LLC pay someone to kill you, and be scott free. “Sorry you can’t go after me, go after this shell company and try to put it in jail ha ha”

Joel_Mckay 2y ago
Yep, people should talk with a real local corporate lawyer or AMCHAM if unsure. The hubris on YC from those that assume the rules don't apply to them is hilarious. But, I guess someone has to pay for the lawyers kids to get though university. Have a wonderful day =3

tracker1 2y ago

The intention is to limit the liability of investors, not those in control of the company.

Joel_Mckay 2y ago
Agreed, the key phrase here is _limited_ liability not immunity. I am still trying to figure out how Boeing got around their commercial insurance companies? There is a bag of vipers also waiting for their turn with the CEO for sure... =3

philipov 2y ago

Limited liability only protects the shareholders. It exists because shareholders have no control over the corporation. It does not protect agents of the corporation, such as management, because they do have control of the corporation.

Joel_Mckay 2y ago
This is true up to a point for shareholders, as for civil liability it is not guaranteed protection in some places. For example, if you hold shares of a firm that makes something locally illegal in another jurisdiction. =3

Joel_Mckay 2y ago

It is right on the incorporation forms prior to entity approval, and in my jurisdiction the Lawyer made this very clear as I make choices hiring ex-servicemen contractors/staff (numerous PTSD issues can limit roles... like "dealing" with aggressive/rude customers can be a bad idea etc.) Additionally, blindly using Lexis Nexis forms can cause issues too, as the same clauses have different legal definitions in different regions. While a C firm does _often_ protect board member personal assets from civil cases, it also does not guarantee protection. Also, international investors do not usually create a US LLC given it usually trips 2 tax codes. Talking with awesome AMCHAM reps about this area is probably in your best interest, but most international firms create a Type C corporation on US soil. Ask your local corporate tax lawyer about liabilities to confirm whether your jurisdiction has harmonized corporate laws. Being a president/CEO is not what most assume, and even a shareholder can get messy too. Despite pop-culture urban legends, it is not a role for clowns or cons. =3

bumby 2y ago

In the US, sometimes the court may “pierce the corporate veil” when actions are particularly egregious or unlawful and hold the shareholders or directors personally liable. Rather than go into all the specifics of law (since I'm not a lawyer), I'll cite some examples where corporate executives were charged personally: (Tax evasion): -https://www.justice.gov/opa/pr/ceo-multibillion-dollar-software-company-indicted-decades-long-tax-evasion-and-wire-fraud https://www.justice.gov/opa/pr/ceo-multibillion-dollar-softw... (Securities fraud): - https://www.justice.gov/opa/pr/ceo-medical-device-company-charged-covid-19-related-securities-fraud-scheme https://www.justice.gov/opa/pr/ceo-medical-device-company-ch... (Identity theft and fraud): - https://www.justice.gov/opa/pr/ceo-medical-device-company-charged-covid-19-related-securities-fraud-scheme https://www.justice.gov/opa/pr/ceo-medical-device-company-ch... (RICO - Providing encryption to avoid law enforcement): - https://www.justice.gov/usao-sdca/pr/sky-global-executive-and-associate-indicted-providing-encrypted-communication-devices https://www.justice.gov/usao-sdca/pr/sky-global-executive-an...

Joel_Mckay 2y ago
[flagged]