IACA



Topic: 2015 Annual Minutes Statement – Corporations Filing Company scam

Question by: Peter Threlkel

Jurisdiction: Oregon

Date: December 3, 2015

|Jurisdiction |Question(s) |

| |Have any other states received a similar notice, and if so can you provide any information on the company and addresses used? If your AG has investigated and identified |

| |individuals and addresses can you share that as well? |

|Manitoba | |

|Corporations Canada | |

|Alabama | |

|Alaska | |

|Arizona | |

|Arkansas | |

|California | |

|Colorado | |

|Connecticut |See additional comments below |

|Delaware | |

|District of Columbia | |

|Florida | |

|Georgia | |

|Hawaii |In Hawaii, this happened here for the first time in the beginning of the year. |

|Idaho | |

|Illinois | |

|Indiana | |

|Iowa | |

|Kansas |We haven't heard about it in Kansas but I would guess we will soon. |

|Kentucky | |

|Louisiana | |

|Maine | |

|Maryland | |

|Massachusetts | |

|Michigan | |

|Minnesota | |

|Mississippi | |

|Missouri | |

|Montana | |

|Nebraska | |

|Nevada | |

|New Hampshire | |

|New Jersey | |

|New Mexico | |

|New York | |

|North Carolina |North Carolina also passes the enforcement on to the AG's Office. However, I think they got the Postmaster General involved and were able to get a copy of the lease |

| |agreement with the box rental location to get the owners of the box. |

| | |

| |Here is a link to NC history with this issue |

|North Dakota | |

|Ohio |. |

|Oklahoma | |

|Oregon | |

|Pennsylvania | |

|Rhode Island | |

|South Carolina | |

|South Dakota | |

|Tennessee | |

|Texas | |

|Utah | |

|Vermont | |

|Virginia | |

|Washington |Washington State has had 2 companies send these type of mailings. |

| | |

| |1: Corporate Records Service in 2012 |

| |2: Annual Business Services in 2014 |

| | |

| |In both of these incidents we forwarded the information to our AG for review and posted a customer alert: |

| | |

|West Virginia | |

|Wisconsin | |

|Wyoming | |

Additional comments:

CONNECTICUT:

That scam hit CT for the first time in about July of this year. Thanks to all the chatter and forewarning that we picked up from IACA (and this Listserve), we were prepared for it and we were able to work quickly to get ahead of the scam. Sorry for the tome you are about to receive, but now it is my turn to pay it forward.

As you will see from the information posted below, we organized a full court press involving the AG’s Office, the Department of Consumer Protection and us. We first posted a notice immediately on our filing home page. Then, once the three state officials issued a joint press release warning customers of this scam, we reworked our Notice on the website to the one pasted below, and created a link directly to the Joint Press Release.

The AG’s investigator tracked the address to a P.O. Box at a local Mailboxes, Etc. store and was able to determine who the owner of the box was. It turned out to be a local man who was operating the scam as a cottage industry, using the P.O. Box to avoid using his own home address. That guy was sending #10 Envelopes with the scam notices enclosed. I believe investigators were able to impress upon the fellow that his actions were misleading at least, if not illegal. While this one was winding up, customers began getting postcard versions of the same scam, from a return address in Florida. That iteration of the scam was ultimately nipped in the bud at a nascent stage, as well.

What I believe is happening is that the original company is based in Florida, and it has done two things as it has learned from past experience: First, it has added certain disclaimer language in small print to attempt to “clarify” that its services are not associated with any state and that it does not operate in any official capacity on behalf of the state. While the disclaimers were an attempt to bring the notices within the law and remove the “scam” characterization, the disclaimers fall short of the mark in terms of both adequately apprising consumers of the true nature of the “offer,” as well as referencing the proper statutes on the forms. For instance, the scam letters going out to all entity types in CT referenced only the statutory sections pertaining to corporations, and therefore only served to create confusion among most of the entities that received them. Second, I hypothesize that the original company saw roadblocks going up around the country and knew it wouldn’t be long until they were put out of business. So I believe the company began franchising the scam, selling a “business in a box, work from home” scheme to other people who innocently thought the business notice scheme was a legitimate way to make money by putting together some easy forms for businesses. For example, I would bet that the guy in CT had bought into the “business” and paid the original company in Florida for a set of forms that he could use to send along to entities in CT. I also think the second scammer, the guy who was sending postcards from Florida (and not ones depicting tanned beachgoers playing volleyball on South Beach), also may have been an “innocent” franchisee. I surmise that these franchisees, themselves, are getting scammed by the original company; as they are buying into a business model that they are led to believe is legitimate. The bad news is that the scam threatens to spread exponentially as new players enter the “market.” The good news, however, is that once they are tapped by the AG in any given state, innocent franchisees are likely to buzz off quickly, as the two franchisees did in our case.

At any rate, in the event it is helpful to anyone, below please find the public notices that we issued prominently in CT that helped to snuff out the scam quickly. We plan to keep these up (or some version of notice) in order to educate customers against future franchisee scammers who may come along. Finally, it should be noted that we received a load of calls and emails from concerned and inquisitive customers who had received the scam notices, so I educated my staff on how to respond to those calls and emails, using scripted samples. It would be wise to prepare your respective staffs to handle these communications appropriately, since they will be on the front lines when the calls and emails start rolling in.

“

Events

State Warns Businesses about "Official" Reporting Scam

Click On This Title for Link to Important Information

The Secretary of the State of Connecticut has received communications from customers regarding a solicitation from a private third party company. The solicitation is entitled "Annual Records Statement" and has an official appearance.

Please note that the described solicitation is from a third party and is NOT an official notice from the Secretary of the State. The solicitation seeks to provide services, for a fee, that are not required services relating to the Office of the Secretary of the State. "Corporate Minutes" and Bylaws are internal company documents that are not required to be filed with the Secretary of the State of Connecticut.

Note, also, that the Secretary of the State does send Annual Report reminder notices via email and postcard only, in the month prior to the due date of your company’s Annual Report. Those notices will have the Official Seal of the Secretary of the State affixed to them, along with a direct link (or reference) to the official Secretary of the State’s filing web address: concord-sots..”

…..

[Clicking on the link takes the reader to the following Joint Press Release:]

, pasted below for ease of reference, albeit not in original format (and goodness knows what the Listserve formatting will do to it!):

FOR IMMEDIATE RELEASE August 6, 2015

State Warns Businesses about “Official” Reporting Scam

HARTFORD, August 6 – Department of Consumer Protection Commissioner Jonathan A. Harris, Secretary of the State Denise Merrill and Attorney General George Jepsen are warning businesses across Connecticut about bogus forms being sent by the “Division of Corporate Services” seeking payment for an “Annual Records Statement,” alleging that payment is required by Connecticut law. A copy of the fraudulent form is attached.

“This scam attempts to collect money from companies that need to comply with a State reporting requirement,” Harris said. “There is absolutely no value in responding to this fake mailing and we urge companies to ignore it; do not send payment.”

“Businesses registered with the state of Connecticut are required by law to file only Annual Reports with our office, which are very minimal in nature,” said Secretary Merrill, Connecticut’s chief business registrar. “There is no legal requirement for any business to file the minutes or bylaws that this company is offering to file, in exchange for payment. Those are internal business documents and I urge any Connecticut company that has received this solicitation to ignore it and not pay for services they do not need.”

"My office has received about a dozen complaints from businesses in Connecticut that have received this fraudulent mailing," said Attorney General Jepsen. "While our agencies are investigating this, I urge businesses and consumers to stay vigilant and to make very sure that any unsolicited requests for payments – whether they are suspicious-looking invoices or forms such as this that appear to reference legal requirements – are truly official before sending payment."

This deceptive solicitation has an “official” appearance and references a Connecticut state law. Scams like this direct the recipient to send a fee, usually much higher than the true fee, for services that are not needed.

Some “official” scam solicitations do not include headings that appear to come from the state, but rather include details and warnings about penalties and fines that could lead the recipient to believe they are authentic. Mailings also come in official looking envelopes with warnings about fines and penalties.

Businesses and other organizations should always scrutinize mailings to be sure they are legitimate before issuing payment. To avoid being defrauded by bogus mailings, Commissioner Harris and Secretary of the State Merrill offer the following advice:

• Review the fine print. Many, like the one in this example, will state that it “does not officially represent the State of Connecticut or other government entity,” or something similar. However, not all fake solicitations include this disclosure, so it’s always best to confirm with the appropriate official source, especially before sending any payment.

DCP/SOTS/OAG, page 2

“Official” Reporting Scam, August 6, 2015

• Before initiating payment, verify with the person in your company responsible for official reporting.

• Be wary of mailings from companies with the word “compliance” in their name.

• Simply because an email address contains the .us designation does not mean it is from the U.S. or any state government.

Secretary Merrill said, “If you are ever unsure about the legitimacy of a business filing notice you receive, please check with my office at 860-509-6003 or go online at concord-sots. if you need information on corporate filings. We are ready and eager to help any Connecticut business owner.”

“I encourage anyone who receives an “invoice” or other request for payment for unordered, undelivered or unsolicited services to notify the Department of Consumer Protection at dcp.frauds@ or call 1-800-842-2649,” Harris said. “By doing so, you may help us to prevent others from being scammed.”

If your business has received the bogus “Annual Records Statement” form, please discard. Do not send money.

An investigation into the mailing is underway.

-end-

Media Contacts:

Claudette Carveth Av Harris Jaclyn Falkowski

860-713-6022 or Claudette.carveth@ 860-509-6255 or Av.Harris@ 860-808-5324 or jaclyn.falkowski@ct

Full text of email:

Oregon businesses started receiving this 2015 Annual Minutes scam from the Corporations Filing Service this week. When our Attorney General subpoenaed the mail drop for the box owner, they tell us the box rental transaction was not completed and they do not have the name of the owner to share with us. The good news is that none of the mail will be forwarded, but we cannot identify the owner for our AG to contact.

Have any other states received a similar notice, and if so can you provide any information on the company and addresses used? If your AG has investigated and identified individuals and addresses can you share that as well?

Thanks,

Peter Threlkel

Director

Oregon Secretary of State | Corporation Division

503.986.2205

peter.threlkel@state.or.us

................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download