Is it really that convenient to buy a ready-made company with a bank account?
“Are there any risks in buying a ready-made company with a bank account for doing business?” Impatient people may wonder.
Indeed, buying a ready-made company seems to eliminate many application procedures, allowing you to close the deal today and start operating tomorrow.
However, running a business is a long-term endeavor, and buying a company comes with some subsequent matters that need to be addressed. Is it really worth it?
Existing Account, New Approval:
After buying a company, the person in charge needs to contact the bank to update the signatory and submit the required documents, usually within a month.
However, if there are changes in the company’s ownership or structure, or if the company undergoes any modifications, the bank will treat it as a new account application and re-verify the details.
The account remains frozen until the application is approved, and the procedures, documents, and waiting time are not much different from opening a new account.
Bank Account Transfer, Is it Necessary?
If the account is only used for ATM deposits and transfers and does not require issuing checks, transferring the account name may seem optional.
However, the purpose of transferring the account name is not for check issuance but to ensure that the account holder’s information is updated in the bank’s system.
If the account holder’s information is not updated, the assets can still be accessed by the previous account holder. Just like buying a property, the new owner would not keep using the previous owner’s password out of convenience or laziness, as it would jeopardize their basic security.
Additionally, to combat money laundering activities and prevent criminal organizations or illegal individuals from taking advantage, banks periodically verify whether there have been any changes in the company’s directors and shareholders.
Even if there are no personnel changes, if the business model drastically differs from before, the bank has the right to re-verify the account.
Assuming the account is not transferred to your name, the other accounts of the previous account holder would be frozen, and the account you purchased would face the same fate.
Considering various risk factors and consulting with an accountant through proper procedures, systematically establishing a company and opening a bank account would reduce unnecessary troubles in the future, which is the best course of action.
Every industry has its own exclusive business techniques. Consulting an experienced accountant can help you avoid unnecessary detours and naturally grow your business.
Finding the right people and doing the right things will make everyone an expert.
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