Friday, June 5, 2015

Family Members Should Never Lend Money to Each Other

“Neither a borrower nor a lender 
be. For oft loan loses both itself and friend.” - Shakespeare's Hamlet

Recently, I've had a serious writer's block. But something happened the other day that has shaken me up and I want to write about it. Today's post is an amazing story in how it displays just how stubborn and stupid people can be and, on top of that, it is a true story. 

Those are the easiest to write for me. You just can't make this stuff up. 

This story is about one of the oldest reasons people destroy their families and lose dear old friends: Money. Specifically, lending money or "borrowing" money from friends or family.

It's one of the oldest stories in the book: a family member borrows money from a sibling and, whether the money deal goes good or bad, the mere fact that there was a money exchange destroys the family because, win or lose, succeed or fail, someone feels that they were cheated in the deal.

This is what happened to my family. 

My oldest brother borrowed money ($10,000 in the early nineties) from my youngest brother to invest in some sort of new business that the older brother was starting up. 

They are both idiots; one for asking a sibling for money, the other for giving it.

The business went bad, if you ask my older brother. If you ask my younger brother, it went bad too, yet my older brother somehow wound up with a multi-million dollar court settlement. 

As I understand it from the both of them, initially, the business went bankrupt. My older brother, claims that he lost all his money when the company went belly-up. So bad were the loses that he had to sue another company for copyright infringement in court. He won, hence the multi-million dollars.

It is a complicated issue. Who won? Who Lost? Did the company go bankrupt solely because of the copyright infringement or did it go bankrupt due to incompetent management? (Give you one guess which reason I think it was...) Why didn't the younger brother share in the settlement? Why didn't the younger brother even get any of his money back?

I don't know. I wasn't a part of this and didn't want to become involved.

I became aware of this transaction a full year after it had already blown up in everyones face. I was living in Japan and had no idea that this deal had even occurred. One day, my father asked that I intervene and mediate in this case as it had turned into a full-fledged war. Upon discussing mediation with both brothers, they agreed - promised - that they would abide by whatever I decided that was fair to resolve this issue.

I wanted nothing to do with it, but my father was getting old and in poor health so, I reluctantly agreed to try to solve this issue. It wouldn't be good if this situation destroyed the family and my father passed away while this still boiled.

Now, before I go on an important point is that, at this time, there had been no court case and my older brother had not yet been awarded any settlement. This is an important point to remember. Because, conveniently for my older brother, he will claim that the court case had nothing to do with the business. The younger brother claims it does.

I have a very holistic view of these things and don't like the cherry-picking idea as it seems to lend itself to selective morality in far too many cases. Dear reader can decide for themselves.

I asked that both brothers provide me with documentation about this business deal. The interchangeable words I noticed in these mails were "loan" and "investment." Soon, I received an avalanche of emails from both brothers concerning items about "who said this" or "you said that."

It was too much of a clusterf*ck to deal with, by that point. I didn't know what to do. It weighed heavily on my mind. Who was right and who was wrong? I didn't know.

One night, I went to my favorite drinking place and there were two Buddhist priests there who I sometimes played Chinese Checkers with. We had a few drinks and I started telling them about my troubles with my family. 

These guys have always had the most calm and reasoned advice. They are great. After listening to me for a while, one said,

"I see. This is a difficult question to answer as to who is wrong and who is right. But I will say that, in spite of that, it is an ancient story that has gone on, over and over, throughout the history of mankind: A family is destroyed by money. Don't you, in the west, say, 'Never lend money to family or friends'?"

"Yeah." I replied. 

He continued, "I think we can agree on is this; there are stories about families being destroyed by money and these stories are at least 5 millennia old. I think it is too difficult to try to place blame here. But one thing we can agree on is that this situation is like a cancer eating away at your family. I suggest that it is best not to place blame, but to put things back the way they were."

A light went off in my head! I thought that was genius!

I went home and the next day I triumphantly wrote to my brothers that I had decided what the best course of action was: To put everything back. 

I told my older brother to apologize (because family should never borrow money from family) and to give back the $10,000. I told my younger brother to apologize and accept the $10,000 and never complain about it again.

My younger brother reluctantly agreed (after I berated him for a money transaction with a family member). My older brother reneged on his promise and said he would never pay back the money nor would he apologize. He claimed that he needn't apologize because the younger brother was trying to make money too. I countered that the apology wasn't for that. I said the apology was for the entire situation and causing so much trouble for the entire family. 

Hell, I had nothing to do with this crap and I was sorry it happened.

L'Enfant Terrible

My older brother was adamant. He said that he would never apologize. He said, "I haven't done anything wrong, so I'm not going to apologize." Once again I said, "It's not for doing anything wrong, it's not accepting any guilt. It is apologizing for the entire mess."

He would have none of it.

That just shows how obstinate my older brother is. Imagine, you witness some old lady walking across the street. She is hit and killed by a car driven by someone else. You see her family later and they ask you what happened. Isn't it normal for most people to say, "I'm so sorry!" Of course it is. "I'm sorry" isn't an admission of guilt. It is showing some empathy for people.

On a side note, I think my older brother has a problem with serious denial and telling the truth. If this deal were such a 'great deal' like he claimed, when he first asked my younger brother for money, then why didn't he invite me to join? - I had much more money than either of my brothers at that time....

But I digress....

I realized then that my older brother didn't have the money and I suspected that this excuse of not apologizing was actually a cover for not having the money. No problem. I then told him, "Look to make peace in the family and to try to fix things for our nearly 80-years-old dad, I will secretly give you the $10,000 and you give it to our younger brother. You don't have to pay me back. Then you say, "Sorry for the entire mess" (not admitting you did anything wrong) and hug and make up for the problems.

"If anything, do it for our dad." I added

But my older brother wouldn't do it. He refused. Saying sorry was a mountain too high to climb for this person. I was appalled.  My patience with this little child was nearing an end. 

By this time, this problem had grown to crisis proportions. My younger brother had fought over and over with both my dad and older brother about this. Though my younger brother I have always enjoyed a good relationship, he was no longer speaking to either of them. My younger brother was angry that, even though he felt that he was 100% in the right, my father always took sides of my older brother.

I did admonish my father about it. But, bless his heart, my dad wasn't the kind of guy who would put his foot down. Had my mother still been alive, my older brother would have never been able to get away with this.

I took no sides. I just tried to make it right. (If my mom had been alive, I know what she would have said. I'd have taken her side).

I was asked to mediate. I did. I offered the $10,000 (Free. Not a loan. A gift) and asked that my older brother give the money to the younger brother and apologize. I told my younger brother that, if he gets the $10,000, to accept and to apologize too. 

My younger brother accepted the terms, my older brother refused. Time went by and, after continued fights with my older brother and father that just kept making things worse, my younger brother's heart grew harder and colder still.

Finally, I gave my older brother an ultimatum. I told him that,

"This families problems are your making. Everyone knows that you don't borrow money from family and friends, yet you did. Then, when this problem became great, you came and asked for my mediation, I didn't want to get involved, but you asked. I did it for the family. You said you'd follow my decision. But you don't.... You have no honor.

Our father is sick and would like to see peace in the family, but, in your narcissistic obstinacy, you refuse. It's been nearly ten years, you asked for my help, you lied and refused. 

This borrowing money from family and friends is an old story and we all know what will happen. Father will die someday and you will still be the one responsible for this mess.

Now, until the day you fix this problem, I have no way to force you into doing what is right. So, until you do apologize to your younger brother and fix this mess you created, I will never speak to you again." 

That was at least 15 years ago.

My father died on Saturday night Sept. 25, 2011.

My brothers still haven't spoken to each other in about 20 years.

I have no intention of ever speaking to my older brother until he does what he said he would do. I am astounded that a guy who gets a multi-million dollar settlement cannot fix a $10,000 problem with his brother. I seriously think this person has some serious issues.

What do you think?

(This article originally appeared in 2011 - dates have been altered for today)


Andrew Joseph said...

Geezus! That is a cluster f*ck! I admire the way you stood up to your brother(s) and mediated. I admire you for telling your older brother that he has no honour.
I look at an investment the same way I look at gambling. Only give out what you can afford to lose. If your younger brother had any brains at the time, he would have just said no to the investment... or when things went sour - live with the loss of $10Gs like a man. Why whine about it. Look at what $10Gs has cost everybody. Money. Honour. Family. Respect.
I, too, wonder why your older brother didn't ask you to invest - if it was simply a straight forward business deal. He probably knew you would question all the details of an investment, while his youngest brother would not. A sucker is born every minute, to be sure. My brother lent me $500 and has never asked me about it again. He knows I don't have the money, but I sure hope he knows I would pay him back when I can. I also lent $3000 grand to a friend. But you know what? He really needed it to get out of some trouble, and I could afford it. I know he will pay me back when he can, just like I will with my brother. And, if he can't and I can't, all parties involved know it's not a big deal... that's only money and that can't drive a wedge between family and friends.
Seems like the writer's block is over. Sorry about your dad, Mike. I'm even more sorry about two idiot brothers - one of whom places pride ahead of everything else. Gawds! Take the gift and make everything right.
The past no longer exists. The future is unwritten. All we have is the now - so waste it not. I like the Zen of Buddhism.
Keep the faith, my brother.

Anonymous said...

Your older brother sounds like a royal jerk. Good riddance, no?

Anonymous said...

Anonymous @1:03 PM wrote, "...Good riddance, no?"

I'm guessing, no.

It may seem like it on the surface and at first glance.

A family torn, is an all around bad thing.

I'm on year two of a similar conflict.

Like this one, I don't see it being resolved, ever.

- clark

Murasaki Shikibu said...

Every family with even a small amount of money in it seems to have problems like this. What does this say about human beings in general?

Andy "In Japan" said...

I agree that one should never loan money to a family member. If they are in dire need and ask nice, and you have the means, then either give them the money or tell them "no" if you so chose.

My sister in law stole 1,000,000 Yen (then about $10,000USD) from my wife. It was my wife's college loan money. According to my sister in law, she borrowed the money (without asking) and did not steal it.

So my wife's bank account is empty and my sister in law has a new wide screen TV, a new VCR, new refrigerator, new goldfish, new doggie, new stove, new washing machine, and so on. Every 6 months I have to pay back some of the loan, and this will go on for 2 more years.

To keep the peace, I never ask for her to pay back the money. She knows she stole it and will never pay us back a single Yen, yet she continues to spend a significant part of her income on booze, new clothes, cigarettes and pachinko.

I feel horrible every time I have to make a payment, but I'm glad I'm not her. Imagine the guilt.

Bet you that Mike's older brother is being punished by guilt more than any of us can imagine.

Anonymous said...

A salutary tale. Murasaki Shikibu asks, "What does this say about human beings in general?"

It says that human beings have choices. Every day. Right up to their last breath. In Mike's story, several people have behaved badly. Yet tomorrow is a new day, and they can choose a different course. Of course, it cuts both ways. The ones who act with integrity and honour also choose to do so. They could just throw in the towel and say, "Nyah, sod it!" It's a choice they have.

Anonymous said...

Andy "In Japan" wrote, "...Imagine the guilt."

Perhaps, but of course, sociopaths don't experience feelings of guilt.

I'd just simply reposes on her ass, Andy. Just walk in and take the shit, especially if you are still making payments on it. The "peace" wouldn't be disturbed, just say you're borrowing it or using it.

Perhaps she'd make payments to get her stuff back? And if she called the cops on you, you'd know where you stood. Being arrested by her would be like.... idk.

Impound that doggie.

Perhaps that's what Mike's little bro needs to do too, just to get closure? Idk.

pachinko? Andy? financing pachinko? There's keeping the peace and then there's letting them walk all over you.

"I feel horrible every time I have to make a payment" DUDE, reposes.
~ Just my copper two Cents.

I seriously doubt Mike's older brother is being punished by guilt more than any of us can imagine.

I know I wrote, A family torn, is an all around bad thing. But still...

There's letting things go and then there's being walked all over.

- clark

Andy "In Japan" said...

Clark, if I did what you said I'd end up with my wife's sister's junk and would still have to pay back my wife's college loan debt.

I don't even have any place for her junk and I hate her stupid yappy dog. Why do I need a second refrigerator and stove? Her TV has negative value because I don't have and don't want a TV.

Plus, my wife would probably divorce me if I did it and the sister in law wouldn't baby sit any more. The woman is also sponsoring me for my Japanese Visa and providing the guarantor signature on my apartment. Still think I should take her VCR and start WW3?

So she is walking all over me to some extent, but it's a very complicated story and "being right" is not worth the trouble it would cause.

Anonymous said...

So, it's an expensive baby sitter payment.
I understand.
Heh, she has you over a barrel.

- clark

Anonymous said...

Commenting from the Land of Lawyers(tm)...

I think your older brother either talked to one, or has been indoctrinated by one. I had an auto insurance card that showed proof of auto insurance, and what to do and say in an accident. It said to NEVER SAY SORRY at the scene of an accident. The reason being from is that saying "sorry" in most states legally is implying that one is at liable or at fault.

Although in the real world, between brothers, he probably should have said something...

Anonymous said...

RE: "Family Members Should Never Lend Money to Each Other"

About a year ago I had a relative ask me (indirectly via other relatives) for an $8,000 loan, supposedly so she could give it to her new boyfriend in jail to payoff a jailhouse extortion.

I said, "No.".
I'm certain that with her financial track record it would have turned out to be a gift rather than a loan. I can't afford that kind of gift.

She hasn't spoken to me since, and it did affect and cause brokeness between other family members.

Damned if you do, damned if you don't?

- helot

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