Compliance Services Joins Hall of Shame

If you form a corporation, the Postal Service soon will inundate you with official-looking forms from companies offering to create or file corporate documents on your behalf. Earlier this week I rescued a client from one of these unnecessary companies, Compliance Services.

Compliance Services sent a form with the following heading:

ANNUAL MINUTES REQUIREMENT STATEMENT

DIRECTORS AND SHAREHOLDERS

(Domestic Stock Corporation)

Citing various Sections of the California Corporations and Business & Professions Codes, the urges the reader to fill in the names of all officers, directors and shareholders (including the number of shares held by each) and to return the completed form with a check for $125, in exchange for which Compliance Services presumably will prepare minutes of annual shareholder and board meetings.

After filling in the form, but before writing a check, my client’s President became suspicious and sent me an e-mail. She asked:

Is this something that is required for the government, or is this just somebody trying to make money off us? Is it important to fill in this form and send it back?

I replied that she should ignore the form and any other similar form that does not come from the state.

To Compliance Services’ credit, it does include a notice stating that it is not a government agency. It is clear, however, that at least some recipients can be tricked into thinking that completing the form is mandatory and that the fee must be paid. For that reason, Compliance Services has been added to this blog’s Hall of Shame.

Postscript #1: Compliance Services has a website that, charitably, can be called minimalist, and the owner of the website has chosen to remain anonymous by registering its domain through Domains by Proxy, Inc. – not exactly characteristics that give one a warm and fuzzy feeling.

Postscript #2: There are many legitimate companies with “Compliance Services” in their name. To the best of my knowledge, however, none of them provides services like those offered by our latest Hall of Shame member.

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Follow-up: I recently noticed that the Florida Department of State, Division of Corporations has posted a CONSUMER ALERT! about Compliance Services.

Dana H. Shultz, Attorney at Law  +1 510-547-0545  dana [at] danashultz [dot] com
This blog does not provide legal advice and does not create an attorney-client relationship. If you need legal advice, please contact a lawyer directly.