We’re covering all kinds of troublesome scenarios in this series of posts about chapters in crisis. The first two posts shared advice for managing and preventing chapter financial mismanagement and chapter financial fraud.
In this series, we’re assuming your chapters are subsidiaries, a situation that brings more risk to National, but also provides more control. Even if your components are independent, you’ll benefit from the advice we share.
Now, let’s turn to federal and state compliance issues. The more time you spend as an enforcer, the less you can spend as an advisor who helps chapters grow, engage and retain members, and share success stories.
Always consult with legal counsel on critical federal and state compliance issues. Our job here is to make you aware of what you may not know, but we’re not lawyers or accountants.
CHAPTER COMPLIANCE ISSUES
Your approach to chapter crisis management and prevention, particularly compliance issues, depends on the relationship between National and the chapters—whether they’re separate legal entities or not.
Separately incorporated legal entities are responsible for filing their own reports with state and federal agencies, but it’s prudent for National to make sure they’re doing that. For one, it’s your brand, and, secondly, you may have to help clean up the mess.