California sues to stop scams targeting small businesses

October 8, 2009 10:36am

•  Faked corporate ‘minutes’ alleged

•  ‘Small business owners must be on the alert’

California is suing eight individuals and six businesses that operated what it calls scams targeting small business owners.

The lawsuits, filed Thursday in San Diego County Superior Court, seek to recover more than $3 million.

"These cases will send a powerful signal that small business owners must be on the alert," says California Attorney General Edmund Brown Jr.

"These rip-off artists sent official-looking documents through the mail for the sole purpose of duping small business owners into paying them money -- for no value in return," he says.

The three cases are separate scams, the state says, each following a similar theme. The defendants are accused of mailing to small businesses solicitations that appeared to be government documents featuring an official-looking seal, an official-sounding name, citations to the Corporations Code and a "reply by" date. The forms claimed that the business was in danger of losing its corporate or limited liability status if payment was not made within a short period of time. 

In the first case, Anthony Williams operated Compliance Annual Minutes Board that mailed to California businesses official-looking forms demanding that the recipient complete the form and return it with payment of an "Annual Fee" of $150 or risk loss of corporate status, says Mr. Brown.

Mr. Williams claimed that in exchange for payment, he would provide corporate minutes but instead prepared generic fictitious minutes for the business owners who paid his fee, says the suit.

The next case involved George Alan Miller, Rebecca Miller, Arghisti Keshishyan and Kristina Keshishyan who together operated two corporations and one limited liability company: Annual Review Board Inc., Business Filings Division and LLC, says the state.

Mr. Miller and his co-conspirators mailed solicitations to California limited liability companies and corporations, demanding that the recipients complete the form and return it with payment or risk penalties, fines and suspension says the suit. The payment amounts varied from $195 to $239, but all mailers were designed to be official-looking government documents that misled the recipients into sending money, says the state.

In the third case, Maria Jones operated Corporate Filings Division and Corporate Compliance Filings Inc., which mailed official-looking forms entitled "Annual Minutes Disclosure Statement" to California businesses, implying that the recipient business was required to complete the form and return it with payment of an "Annual Fee" of $175 or risk loss of corporate status, says the legal action.

In exchange for payment, Ms. Jones agreed to provide corporate minutes, but the information she solicited was inadequate for legitimate corporate minutes, and she instead provided fictitious minutes, contends the suit.

In all three cases, the Attorney General's Office seeks civil penalties, injunction and other remedies and costs. 

Since 2004, the Attorney General's Office has received more than 5,000 complaints against a growing number of individuals who mailed solicitations made to look like governmental forms to small businesses in California.

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