Corporate Compliance Recorder- Beware of Fraud!
A client of mine received a letter from the “Corporation Compliance Recorder” with a return address in Los Angeles, CA. The envelope included a very official looking seal that if not given a second look, could be misinterpreted as a government seal. The envelope contained an “Annual Compliance Notification” quoting sections of the California Business Code and its requirement that a California corporation must keep annual minutes. The company also threw in some scary language about “personal liability for corporate negligence”. They then requested remittance of the included fillout form and a fee of $125 ($175 if filed after the “due” date).
Now the unwary and busy entrepreneur would just fill it in and send in a check to ensure “compliance”. But my client’s smarter than that, he consulted me.
While it is true that in order to maintain your corporate charter, you will need to keep certain company records, YOU DO NOT HAVE TO PAY A FEE TO ANY “COMPLIANCE RECORDER” TO HAVE THIS DONE. Your books and minutes can be kept by the corporation and do not have to be filed anywhere except maybe in your desk.
So when in doubt, read the fine print (they will usually have a disclaimer stating that they are soliciting business and this is not endorsed by any government agency). Make sure the agency on the return address label is a legitimate government agency. Or just ask your trusted attorney advisor.