tci Part B Insider - 2003 Issue 9

Look Twice at These 5 JV Warning Signs

You should take notice if your joint venture exhibits any of the following five elements, which the OIG views as particularly problematic: 1. You expanded into a line of business that depends on your own referrals to survive. 2. You don't operate the business yourself, nor do you commit "substantial financial, capital, or human resources to the venture." 3. The entity you've joined forces with is a would-be competitor. Warning: This has "kickbacks" written all over it. 4. You and the other entity both benefit financially from the venture. That is, your partner "takes its share in the...

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