Disclosing a criminal in the company

[vellocet]

Okay, we've been doing business with a Chinese company for a year now. They're good folks and all. My company is very small, only 4 people (we outsource everything). Me, the rep on the ground in Asia; my boss who invented the product originally; and two investors who have a substantial say in things. My boss is a convicted felon and an asshole to boot. He has a habit of making things up when situations don't go his way. He was recently re-incarcerated, and will not be around for the next 16 months. A few weeks previous to this, he had directed that I should be fired, and evidently spent time talking on the phone to our contact at the Chinese company, and invented stories about how I was going to start my own company and other discrediting lies. He's out of the picture now, and to restore my credibility one of the investors suggests revealing the boss's past and coming clean about it.

My question is, what will the Chinese company think about this? Is it actually better to tell them? I see three options, 1) make something up, say he's in the hospital now (he was hospitalized for cancer earlier this year); 2) come clean and discredit him...but his crime is pretty heinous. Would the Chinese company continue to do business with us if they knew? Even though the investors control most of the company and are running things now. 3) Go on, pretend like nothing happened.

[roddy]

Sounds like it's time to start your own company

More seriously (although I'm no expert here) I would

Tell the company officially that he is away on family business or something. Explain to them how everything will be handled in his absence and reassure them this will make no difference to your cooperation

Then, get someone the Chinese side trusts to take someone from the Chinese side that your company trusts out for dinner and give them a more realistic version of events - perhaps 'legal problems', 'unreasonable behaviour' or something, and that he won't be back for over a year. Or even just the full story. Emphasise again that the people left can handle it.

That way someone on their side has a fair version of events which they can choose to distribute as and when necessary, and your company has mostly saved face.

Roddy

PS I was just guessing though

[woodcutter]

This is a good case of what I have just written about on the other thread in this thrilling new finance forum.

I do not think that there is any specific Chinese reaction to business partners who commit henious crimes (mind telling us what?). You have a better chance of dealing with the situation appropriately by using your nose than you have by relying on opinions offered here, I should imagine.

[xuechengfeng]

I'm not Chinese, but I think there is a rather simple answer to this. By making up an excuse to where your boss is, you risk your own credibility and you are putting your own dealings with them in possible jeopardy. My best advice would be to not say anything to them unless they bring it up. If they do, tell them the truth and act as surprised as them. Make sure you convey the message that though he is an important aspect of the company, one person never really represents a business.

[vellocet]

Well, it turns out that he never actually made any calls to our Chinese company. He only said he did. I talked with my counterpart, and he said he hadn't spoken to my boss for several months. We tell him the boss is in the hospital, case closed.