Is it illegal to take the funds of the initial investors and deposit into a different company's account/busine?

I am a co-owner of a corporation in Michigan. The co-owner has place the funds of the initial investors in his other business bank account in which we have no interest in. He's also deposited sales from the business into the other in which the investors do not have an interest in.. The company was formed about 3 years ago. The investors have not received any payment from sales nor have he paid any of the initial money back to the investors.. The company is in operation, however, the investors do not receive any revenue from the sales made. About a year ago he claimed he was going to desolve the company, however, I checked and it's still operating. He did however give us a promissory note which he has defaulted on.. Is his action illegal since the money was not paid back and he still operating and receiving revenue from this business?