DENVER - Addressing what he called a "very widespread" problem, Secretary of State Scott Gessler warned business owners to be wary of a letter showing up in thousands of Colorado mailboxes.
At first glace, the letter looks like an official state document. It has a seal, cites the Colorado Revised Statues, and uses attention-grabbing language telling small business owners they're at risk of becoming "noncompliant" or "delinquent."
The letter urges small business owners to fill out an enclosed form and send a check for $225 to file a periodic report with the Colorado Secretary of State's Office, which is required by law.
"That's just deceptive. The annual fee is $10. And it takes someone 10 minutes and they can do it themselves. So that's what we've been telling people," Gessler said.
Business owners may be compelled to quickly send a check. If they read the fine print, they'll see this official-looking letter isn't from the Colorado Secretary of State's Office. It's not even from a company in Colorado.
The letter from is from Nevada-based Corporate Controllers Unit, Inc. What do small business owners get for that $225? Something they can do themselves online for $10.
"When you come to the Secretary of State's website, give us your email address," Gessler said. "That way we can keep you updated so you don't fall subject to these scams."
"Small business has it hard enough without predators like this trying to scam us," Daniel Boyd, one of dozens of business owners who have called and emailed 9NEWS since Saturday, said. "I don't see where this company provides any service."
Corporate Controllers Unit, Inc. did not have a phone number listed on its website or in company paperwork filed with the Colorado Secretary of State's office.
9NEWS emailed the company through their website Sunday afternoon and again on Monday requesting comment. We had not received a response as of Monday evening.
The company website did feature five testimonials, supposedly from satisfied customers.
Gessler says the letter appeared to be an intentional attempt to deceive business owners, by looking similar to a government document.
"That's not our state seal. It's not our fee schedule," Gessler said. "We didn't authorize this at all. And that's why I think it's deceptive."
The Ripoff Report website listed 27 complaints against Corporate Controllers, Inc. as of Monday evening, up from nine complaints just one day earlier.
9NEWS began receiving a flood of news tips over the weekend about the letter from Corporate Controllers Unit, Inc.
"If I hadn't read this thoroughly, I might have sent the fee, which I can't afford," Dana Rock said.
"It almost had me fooled," Robin Zietz said. "My concern is that other small business owners will be fooled into thinking this is a legitimate government letter and send the money."
"Unfortunately, these misleading statements are not new," Rich Coolidge, communications director for the Colorado Secretary of State's Office, said.
"It's important for your viewers to know that they can file on our web site for $10 to file their annual report," Coolidge said. "They can contact our business division or review their record on our business database."
The Colorado Secretary of State's Office put out an alert about potentially deceptive or misleading solicitations in 2008.
According to the alert, these solicitations tend to share common elements and may contain one or more of the following characteristics:
- Appear similar to a government form;
- Contain an official-looking seal;
- Refer to a statute or quote other Acts or laws;
- Imply that failing to return the form and pay a fee may place your company in jeopardy, may "pierce the corporate veil," or might cause your company's filings with the state to be in a noncompliant status;
- Contain a "Corp Number" or "Corporate Identification Number" that does not match a number given to your entity by a State or Federal Agency.
Businesses who receive these letters are urged to email the Colorado Secretary of State's Office: sos.business@sos.state.co.us or call 303-894-2200 and select option 2.
The Business Division may request a copy of the notice, which can be faxed to 303-869-4864.
The Secretary of State's Office advises business owners to keep the original notice, mailing envelope and return envelope for their records.
"I only wonder how many small business owners who are already struggling to survive didn't read the entire document and forked over $225 to this scammer," Stephen Wiggs said.
"I'm afraid that many people will not read the fine print and blindly send in their $225 check to these scam-artists," Cindy Schuler added.
"It's tough enough for small businesses these days in current economic conditions," Michael Beach said. "[This] could make it even worse."
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