Comments (20)

Publishing Guidelines: You are welcome to publish this article in its entirety, electronically, or in print, free of charge, as long as you include my full signature file. Please send a courtesy link or email where you publish to secuone@aol.com Thank you.

Copyright 2004 By Gary L. Cunningham, C.P.O.

Why should you worry about liabilities in your business? Well, for one and probably the biggest reason, you could get sued for everything you have! But I guess you have insurance for things like that, right? Well, did you know that if you are found negligent in any action, there is a very good chance your insurance carrier will not stand behind you?

That has happened to more people than you think, and then they get to pay all the bills like the legal fees, court costs and yes the final judgment against you.

Just think about it, most lawyers charge an average of $250.00 an hour, then there are the court costs, the bad publicity a court situation will undoubtedly bring to your business and of course the money you have to pay the person(s) that filed the suit in the first place.

WOW, can you imagine trying to pay for a multi-million dollar judgment plus all the other costs that you will get hit with! Hope you are saving a lot of money for the future and you checked out your insurance in case it is a negligent suit you're filed with!

So, you are now wondering what is liability? In this article we are discussing the liability of security in your business! These are the main liabilities you will have in a business when it deals with security issues:

-Negligent Hiring/Retention
-Failure to Provide Adequate Security
-Failure to Properly Training Security
-Premises Liability

So there is a lot you can do for reducing/eliminating these types of liability issues. Preparing for them ahead of time will save you money, time and maybe even your entire company.

The first thing you can do to reduce your security liabilities is to have a physical site security survey done by a competent security consultant. In this manner you will be able to find out just what your liabilities are and what measure you need to implement to reduce them.

The second thing you need to do is actually implement the recommendations from the consultant. Without this step in place you do nothing but raise your liabilities, especially if it is over a matter of cost of the security measures you need to implement. The courts do not look favorable on those that neglect to install security measures just because of the cost associated with them.

The third thing you should do is look at all your policies and procedures; they will usually be the reason that you have a security issue in the first place. Most times the security measures you need the most to reduce or eliminate an issue is in the way policies and procedures are written or not adhered to.

Take a close look at the entire make up of your company, hiring, retaining and termination of employees. Look at all you policies and procedures for the way you do and run your business. Take a close look at the outside of your business for anything that may get someone hurt or protect a possible criminal.

This is the only way you will find the things that can get you sued, you have to find them first to fix them. Having a lawsuit filed on you for them and going to court saying you didn't know is not a valid excuse!

Look at the crime factors in your neighborhood and other businesses around you and then see what you can determine is possibly going to happen to you in any type of criminal event or incident that you may be sued for.

Then make the necessary changes to all these to reduce/eliminate the possible lawsuit factors. It is not easy or not time consuming to do all this. That is why it is suggested a security consultant do it for you. It can save you a lot of time, money in the long run and be done the right way before you do get sued.

About the Author

Gary Cunningham is a Certified Protection Officer with over 30 years experience in High Risk Security, Law Enforcement Special Operations, Specialized Training and Military Special Operations. For more information on his services to business owners, check out www.cmbizinfo.com or e-mail him at mailto:secuone@aol.com!


Candy J 28.06.2006. 14:22

Are the democrats really responsible for the Social Security to be used in ways other than as pensions? I received an email today that stated that most of the changes that have caused the downfall of the social security system were done by democra tic presidents.

Candy J

Admin 28.06.2006. 14:22

ANOTHER fiction spread by those who want to destroy Social Security by "privatizing" it. If anything, the greatest danger to Social Security is the Republican right and George W. Bush.

First of all, Social Security is not in collapse and the word "downfall" is entirely inaccurate. It is well over 30 years in the future before any basic differences in income and payments will reach a negative balance, and much longer after that before the Trust Fund would be in trouble.

The Social Security Trust Fund has been used to falsify reports of government debt for decades. As the first poster partially got right, a Democrat, Lyndon B. Johnson, borrowed from the fund to finance his ill-founded "guns and butter" program for both war and expanded welfare programs (yet ANOTHER reason protests against the Vietnam War were RIGHT).

However, that generated a debt to Social Security owed by the Federal Government's general fund. It is still outstanding - something that critics of the program today attempt to conveniently ignore.

This practice was followed enthusiastically by Nixon. Ford also engaged in it but to a very minimal extent. Carter took practically nothing from the fund.

But the BIG boodler of all time, before George W. Bush, was Ronald Reagan. It was under his Administration that the smoke-and-mirrors game was perfected to mask the true condition of the country's finances, by counting the trust fund as part of the national bank account. This, of course, was a deception. On top of that, to fund his outrageous (until now, anyhow) defecit spending, Reagan also looted the fund. Part of the money ironically went to pay off seniors ruined by the scandalous savings and loan collapses that followed Reagan's deregulation of financial institutions and his lax enforcement of the remaining laws governing those institutions.

The elder Bush might have made more raids on the fund but fortunately lost his re-election bid.

Clinton was no angel in this matter either. A chunk of the "surplus" he claimed in his Administration really belonged to Social Security. But he did manage to make an attempt to deal with the looming "unfunded liability" resulting from government borrowing from the fund, ill-advised Social Security contributions tax cuts, and changing demographics.

Geroge W. Bush has simply been making a meal of that money, all the while crying crocodile tears over the "need to reform" Social Security. And he too is padding his reports on government finances by improperly counting money in the trust fund.

The City of New York decades ago was bankrupted by pension fund liabilities the city never even bothered to prepare to pay. The City of Los Angeles several years later came close to the same problem.

Private companies with big pension programs have turned out to be fakes, for the most part - either through mal-administration of the funds, or consequent to mergers and acquisitions, many major pension plans have become costly failures damaging the lives of the people who earned their right to pensions. It turns out that Regan pulled a cute trick with some of his measures encouraging mergers and acquisitions - pension funds after an acquisition were no longer protected from use. They were considered a disposable cash asset of the acquiring company. Well, THAT money sure wasn't allowed to sit around waiting for some useless retirees to get!

Whether private pension programs, or Social Security, the "reforms" needed are to protect the funds from the grasping greed of politicians and corproate executives. The LAST place Social Security funds should be spent is in the Wild West of the stock market.

If you worry about Social Security, exact a pledge from the person running for Congress in your district to begin a structured, steady program to repay all the "government loans" taken out of the Trust Fund and keep Social Security out of the hands of the public and private boodlers!


Jessi S 12.09.2007. 20:43

Tax implications of collecting money for a group to be used for that groups camping trip.? Myself and a group of friends are going on a camping trip in which we create a large elaborate camp with Moroccan tents for public spaces, a kitchen with prepared meals, generators, lighting, and rented moving trucks for transport.

I have been doing the collection for the money, and I've been storing it in a bank account. There are 40 people who will be paying into the camp fund, and who will be joining us on our elaborate camping trip.

Because I've been storing the money in a checking account I'm worried that there is going to be an IRS (and state) tax implication. Is there a way to pro actively protect myself from being taxed on this money which is not mine, and I am not using for any personal purposes? How much do I need to worry?

The checking account the money is in is ONLY being used for these camp funds. My personal funds have never commingled with these funds.
I am a member of the group that is going to be camping.

At no point would I ever consider these funds my own.

The bank account was opened by myself, but I added the camping trip's leader onto the account.

Jessi S

Admin 12.09.2007. 20:43

Everyone is pooling their money, and the money is being used for a specific event to the benefit of everyone who contributed. If the money collected is going into a checking account in your name, then it is considered income to you, and you are responsible for any tax liability. The bank is going to report the interest earned in your name, under your social security number, listing you as the owner of the account.


If you don't think this is fair, at least one person agrees with you. His name is Willie Nelson who got hit for millions of dollars of taxes due relating to his Farm Aid concerts.

If the money is your bank account, then do not distribute 100% of the money. Your camping group will understand that the taxes due are an expense to be paid just as important, and legitimate as the moving van bills, generators, and tent rental. The IRS is using you and your tax return in order to collect the taxes due on the money, even if as you say, you do not consider the money as your own. If you don't report the money in the bank account as income, your risk is that it could show up in an audit, and penalites added to the tax due.

If the money goes into a "camp fund" checking account, that you started, in the name of the camping group, then the camping group is responsible for any tax liability.

Keep accurate records and make a final accounting report available to other members of the group showing the money that was collected and the expenses that were paid.

It might be good to register your group as a tax exempt Social Club, especially if your camping trip is an annual event.
IRS Publication 557:


Look to the camping trip leader for guidance on this. If the leader's name is on the account, that person can withdraw any funds they wish at any time.

Talk to your bank, and consider placing the camping trip funds in an escrow account rather than a regular personal checking account in your name. An escrow account is used to "hold" money that doesn't belong to you, or money you are managing for others.


J Man 02.02.2009. 23:36

When there is a credit card chargeback is the business forced to accept the loss? I'm thinking about starting a business, but I'm worried about credit card chargebacks ruining my profit. Is there any protection from chargebacks i.e. insurance or is it pretty much part of running a business?? Thanks

J Man

Admin 02.02.2009. 23:36

No legit business that provides a product or service that their customers need/want will have a "lot" of charge backs.

To help avoid them, have your customers swipe their card -- this increases the likelihood that the card (and cardholder) were present. If you take online orders, make the CVV or CVN (the three digit security code on the back) a required field in your shopping cart. This is generally not required to process the payment, but greatly helps in defending yourself against charge backs.

Should you have lots of charge backs, you will likely have trouble getting a merchant account (or keeping one). Here's why:

When a charge is made on a card, the company that provides you a merchant account is usually the one that actually gives you the money that day or the next day. That company then sells that "paper" or "ticket" to Visa/MasterCard whoever puts their logo on that card and they charge the customer at the end of the month. Sometimes there is a bank or other issuer in there that will buy the "paper" from Visa/Mastercard.

The problem comes when you get charge backs, the contract the company that provided you with a merchant account signed to be able to process those cards for you (and earn a little fee for themselves in the process) says that they agree to purchase any chargebacks (that can't be proven to actually have been the cardholder). The presumption of innocence is on the cardholder...not you the company that charged the card. If you raise the "fraud" rates of the company that provided you with the merchant account, you are a risk and liability to them because they are buying your "tickets" when you make a charge on a card.

You can go with offshore processors that couldn't care less how many chargebacks you get. They usually do the processing for the adult entertainment industries (where there are a lot of charge backs...imagine that...) but they want 27% - 30% or more with a monthly minimum to them. It's extremely expensive to do that...but it can be done.

Good luck.


Valencia 16.09.2012. 22:34

Can the irs take my refund if my husband owes child support? Can the IRS take my tax return if my husband owes child support for other children. I'm a little worried because I was told that I may not get any money due to his child support issues. I need my money and I hope someone can help me. He has other kids can my money be taken away because of his issue?


Admin 16.09.2012. 22:34

With the REFUND offset program yes this is possible for this to happen.
You may be an injured spouse if you file a joint tax return and all or part of your portion of a refund was, or is expected to be, applied to your spouse?s legally enforceable past due financial obligations.
Here are seven facts about claiming injured spouse relief:
1. To be considered an injured spouse; you must have paid federal income tax or claimed a refundable tax credit, such as the Earned Income Credit or Additional Child Tax Credit on the joint return, and not be legally obligated to pay the past-due debt.
2. Special rules apply in community property states. For more information about the factors used to determine whether you are subject to community property laws, see IRS Publication 555, Community Property.
3. If you filed a joint return and you're not responsible for the debt, but you are entitled to a portion of the refund, you may request your portion of the refund by filing Form 8379, Injured Spouse Allocation.
4. You may file form 8379 along with your original tax return or your may file it by itself after you receive an IRS notice about the offset.
5. You can file Form 8379 electronically. If you file a paper tax return you can include Form 8379 with your return, write "INJURED SPOUSE" at the top left of the Form 1040, 1040A or 1040EZ. IRS will process your allocation request before an offset occurs.
6. If you are filing Form 8379 by itself, it must show both spouses' Social Security numbers in the same order as they appeared on your income tax return. You, the "injured" spouse, must sign the form.
7. Do not use Form 8379 if you are claiming innocent spouse relief. Instead, file Form 8857, Request for Innocent Spouse Relief. This relief from a joint liability applies only in certain limited circumstances. However, in 2011 the IRS eliminated the two-year time limit that applies to certain relief requests. IRS Publication 971, Innocent Spouse Relief, explains who may qualify, and how to request this relief.
For complete information on Injured and Innocent Spouse Tax Relief, visit IRS.gov and use the search box for any of the below referenced items that you want to look at for more information.
Publication 555, Community Property (PDF)
Form 8379, Injured Spouse Allocation (PDF)
Instructions for Form 8379, Injured Spouse Allocation (PDF)
Hope that you find the above enclosed information useful. 09/16/2012


dude26 07.07.2009. 02:37

Can you legally carry pepper spray w/o your employer knowing? I work in security. I have noticed a rise in incidents/crime where i work and worry about my safety. These are tough economic times. Can my employer actually deny me the right to carry pepper spray when the law says it's legal to carry for self defense??? They worry about liability/getting sued and don't worry for their own workers safety, what a shame!


Admin 07.07.2009. 02:37

You can carry it legally, yes, if it's not against the law in your state. However if an incident occurs and you actually make use of the pepper spray, you will in all likelihood receive disciplinary action from your employer - even a possible firing - for deliberately going against company policy. Also, since you knowingly violated company guidelines, you - not your employer - would be held liable for any monetary damages if the person who you pepper sprayed filed a civil suit.

It's quite a dilemma...I sympathize with you. I'm not sure what I'd do under those circumstances myself. Good luck with everything...


gotter7777 29.10.2010. 15:14

What will the Federal Reserve buy the bonds with? What will the Federal Reserve buy the bonds with? Will they just print money and buy the bonds, should this worry us that the government is printing money to buy its own bonds and what will this due to the U.S. economy.


Admin 29.10.2010. 15:14

Let me ask you a question: How do you think the money supply gets adjusted? As an economy grows, so does the demand for money. A higher demand for money requires a higher supply of money. If the supply of money does not meet the demand, deflation occurs and that is much more destructive to an economy than mild inflation.

Typically, the Federal Reserve buys Treasury securities (T-Bonds, T-Notes, and T-Bills) on the open market. The open market is where investors, who previously purchased Treasury securities at auction, sell the securities before the maturity date. In this situation, the money supply is increased directly with somewhat of a domino effect through the money multiplier of fractional reserve banking. BTW, the money supply is decreased in the same manner except the Federal Reserve sells some of the Treasury securities that it holds instead of buying them. The following web page provides a brief explanation about the Federal Reserve, monetary policy and the economy. http://www.dallasfed.org/educate/everyday/ev4.html#mp

Where does the money come from? To put it simply, it is created. The supply of money is not a fixed amount. So when the Federal Reserve buys securities on the open market, the Fed contacts brokers for quotes on a particular amount of U.S. Treasury securities. The Fed accepts the best quotes for the securities that are offered. Instead of paying the broker directly once the securities are delivered, the Fed increases the account of the broker's bank at the Federal Reserve and notifies the bank that the account has been increased.

When a person deposits money into an account at a bank, the balance of the account is a liability to the bank. It is the same with the accounts of member banks at a Federal Reserve bank. The accounts of depository institutions are liabilities of the Federal Reserve district banks. So, when securities are purchased, an account of a depository institution is increased (a liability) and the Treasury securities account is also increased (an asset).

Typically, the Federal Reserve uses open market operations in order to make adjustments to the Federal Funds Rate (the rate the government can borrow money for short-term T-Bills (1 year or less)). The Federal Reserve cannot set this rate directly. It is simply a target for new and existing issues of short-term bonds on the open market. If the Federal Reserve buys securities, that puts downward pressure on the yield of securities since demand for those securities has increased. What is unusual about the Federal Reserve's recent statements is that quantitative easing is the purchase of larger amounts of securities than is normal even though the interest rate is already approaching or at 0%.

The danger of all of this is that if the money supply grows too fast, or businesses, investors, and banks suddenly begin spending or loaning money that they have been hoarding, it may result in too much money in the system. This will cause a sharp rise in inflation and the Federal Reserve may not be able to reduce the money supply fast enough to prevent inflation from rising above 5 or even 10%.

Monetary policy actions are a tricky and difficult thing to control. It is kind of like setting off a small explosion at the top of an avalanche-prone snow bank and hoping that only a small portion of the snow bank slides. Unfortunately, the snow bank might not budge, it might all come down at once, or it could be a delayed reaction where part moves now and the rest comes tumbling down later.

Economics and monetary policy of central banks is a complicated subject. I hope that this explains it a little better for you. If you want to learn more, I suggest you take a money and banking course at a college or read a college textbook on the subject.


Sydney 05.09.2008. 19:55

Does radiation harm my medication at airport security? While going through airport security, I try to avoid having my medication x-rayed. However, I show the container to security who then takes the medication some where else. I suspect to another x-ray machine. I am from Canada (snowbird) and start my air travel in the US.


Admin 05.09.2008. 19:55

If your medication is going through an x-ray screening machine, there are no worries. Think of the liability, if your medication was altered and you got sick or even died. They wouldn't do that on a mass level, if it were dangerous.

The folowing website has questions answered by qualified personnel who are experts in radiation and it's effects. Here is a similar situation:

"QUESTION: Does radiation from a security screening device, like those used in airports, affect the items that pass through them such as baby bottles, food items, plants, electronic devices (cell phone), or drug products (like injectable nitroglycerin for a heart condition)?

ANSWER: The radiation exposure from these devices is too low to affect any items passing through (other than certain types of camera film which can darken) even from repeated exposures. Additionally, in case you were wondering, there isn't any residual radiation in exposed materials after the exposure is complete either."



Nobody 25.01.2008. 19:19

I do childcare for someone and they want to use the monies paid on childcare, do I have to give them my SS#? The people I do child care for wants my EIN or my Social Security number, to use to show that they paid me on there taxes, Im not comfortable giving them my SS#, Is there any other thing I can gice them.


Admin 25.01.2008. 19:19

The IRS does ask them to provide your tax ID number, which would be your social security number.

You'll then need to report your income on Schedule C so that it can be properly assessed for Income, Social Security, and Medicare taxes. This is WHY they want the SSN reported.

You can refuse to provide your social security number, and then they will write "Refused" on the form, but if you do that, you may be subjecting yourself to even more scrutiny in the future.

If you're worried about giving out your Social Security Number, consider forming an Limited Liability Company (LLC) in your state and using it to conduct business. This is more costly than running a business under your name.


towwwdothello 16.08.2009. 17:43

How is this generation going to pay the social security of the retirees&also afford their own social security? How many other generations have inherited this level of pressure in re to the American dream?


Admin 16.08.2009. 17:43

Medicare - 36 trillion dollars in unfunded liabilities
Medicaid - 35 trillion dollars in unfunded liabilities
Soc. Security - 13 trillion dollars in unfunded liabilities

The Government will just continue to cut reimbursements, cut services and raise taxes.

That's what the Government does best.

And for those gung-ho about Obamacare -- it's only a matter of time before our kids will be faced w/ this same cross-road. But I guess best policy in D.C. is to worry about the consequences later.


INDoll 15.09.2007. 16:00

Will they take extra tax to make up? I am single and just started my first real job where I truly have to worry about taxes.I accidentally put down 3 exemptions on my federal tax and it has been that way now for 6 bi-weekly paychecks.I went back and put 1 down to correct my tax form,but since they weren't taking out enough taxes in the first place, does that mean they are going to double the amount of taxes they take out for my next 8 paychecks to make up for the difference that didn't get paid in the first place? I have heard of people filing 10 and then changing it at the last minute so they don't get caught.I'm just worried that they'll take out way too much to make up for my mistake and I'll be broke.


Admin 15.09.2007. 16:00

1. If you put more allowances on your W4, your employer will withhold less federal and state taxes from your pay check, but your social security and medicare deductions don't change.

2. In January 2008 your employer will send you a form W2. It shows your total income and amounts withheld for various accounts (SE tax, federal tax, state tax...).

3. You will need to file your federal and state income tax returns in 2008 by April 15, 2008. The returns will show your total income (from W2) and your total federal and state taxes on that income (these tax figures has nothing to do with what you put of your W4).

4. Now if on W2 you paid more federal taxes than your federal tax liability as per your return, then you will get a refund. If on W2 you paid less federal taxes than your federal tax liability as per your return, then you must make the payment. So if you put 0 allowance, you should expect a fat refund check after you file your return. If someone puts 10 allowances, he/she may be required to pay additional taxes plus interest and penalty.


Write a comment

* = required field





* Yes No