Beware of Scams Targeting LLCs and Corporations
As a legal assistant for a law firm that creates hundred of entities (limited liability companies “LLCs”) and corporations) each year, I receive quite a bit of correspondence addressed to our LLC and corporation clients in care of our office. I have become very familiar with the Arizona Corporation Commission (the “ACC”), Arizona’s agency that regulates LLCs and corporations, and the Arizona Secretary of State. I can recognize suspicious correspondence when I see it. Some scam correspondence is strikingly similar to that which is official, even to the trained eye, so it’s important that business owners be vigilant for suspicious official looking correspondence.
Only the ACC, Arizona Secretary of State, an Arizona County Assessor, the Internal Revenue Service and bona fide government agencies send notices regarding your Arizona entity. Beware of correspondence that looks too much like a government form sent by an outfit of which you have never heard that asks you to send money. If you are not sure an official looking notice is legitimate, spend some time to investigate and identify the sender of the correspondence.
Do a Google search for the name of the sender, its phone number and address. Try to find the sender’s website. If the sender does not have a website that contains real substance, think twice before sending money to the sender. Contact the sender directly to verify that it did indeed send the correspondence. See this article on our website for more information on large-scale scams targeting Arizona entities as well as a joint statement by Arizona attorney general Terry Goddard and the ACC.
Arizona entity owners should beware of the following characteristics of scammers and their correspondence:
- Scammers produce very official-looking notices or invoices. Remember, the only reason for sending correspondence nearly identical to that which is authoritative is to deliberately deceive or mislead company owners. If these pieces of correspondence were simply notices, offers or legitimate marketing attempts with no intent of deception, they would not imitate official authoritative correspondence by attempting to utilize its language, layout and color scheme;
- Scammers will ask for money or confidential information. Let’s get this straight – they’re not giving out courtesy compliance notices! They want company owners to pay for a product or service that they may or may not provide, or use the information obtained for their own purposes. Even if one of these parties does provide the product or service promised, many times the service they provide is over priced or even worse – not required by Arizona law, as is implied by the correspondence;
- Most scams or misleading correspondence can be traced to a P.O. Box or other type of mailbox whose owner is difficult or impossible to determine;
- Many of these notices contain vague or unverifiable claims (“Included is a $17,000 “We Pay the Fine” Reimbursement Guarantee”); urgent due dates; “file” or “corporation” numbers; conflicting, confusing or missing information (several contact addresses, no actual distributing entity name) and even excerpts from the Arizona Revised Statutes in an apparent effort to confuse, legitimize or intimidate;
- The fact that these parties have your company name, file number and address means nothing. All Arizona entities must provide certain information to the ACC, which is then displayed on the ACC’s website where is may be seen by anyone with internet access. Scammers routinely check the ACC website to build their mailing lists, much like they do with new homeowner information found on the Maricopa County Recorder’s website.
The bottom line is beware of any correspondence with these characteristics and read each piece of correspondence carefully before paying money or providing information to the sender.
If you receive a notice specifically claiming that some sort of action is required to keep your Arizona entity from being terminated or dissolved, call the ACC at 602-542-3026 to check on the standing of your LLC or corporation and deal directly only with the ACC or your business attorney to ensure reinstatement of your entity if necessary.