The Myth Behind the “Annual Director List” Notice

In a past article, I highlighted the dangers of fake trademark notices that trick unwitting companies and individuals into paying for needless registrations.  The only place to federally  register a trademark is with the U.S. Patent and Trademark Office, and any important correspondence will clearly identify the sender as the USPTO.  There are no  other required fees or filings.

Disappointingly, there is no shortage of “fake” solicitations within the general corporate world either.  Unscrupulous individuals will trick business owners by sending a notice that looks official to the untrained eye which will usually say something like, ‘don’t let your corporation lapse.  Fill out this form to file your annual director list’.  Except there is no required “annual director list.”

A number of Secretary of State websites caution companies about acting on these notices.  For example, the State of California has been cautioning businesses about not sending filings or fees to third parties as far back as 2009.  But sadly the bad behavior just evolves.  Companies began seeing notices instead encouraging them to fill out and file a form to receive a Certificate of Status.  This fraudulent solicitation has turned up in other states as well.  A company doesn’t need a Certificate of Status, more commonly called a Good Standing Certificate, until they do.  And then the only place to obtain one is from a Secretary of State.

Massachusetts businesses have received notices allegedly requiring “annual minutes” or “annual records”.  There are annual actions that should be undertaken, but they are not these.  As we previously recommended, if you’re not sure, ask a trusted advisor.  We’ve counseled numerous clients on what annual actions an entity should undertake and how to better manage annual filing requirements and it has been very gratifying to save companies money and keep them in compliance without risk of falling prey to tricksters whose only goal is to separate companies from cash.

With a few exceptions, most states have periodic filing requirements.  The first six months of the year is the busiest time for annual report filings.  Delaware, Florida, Georgia and Massachusetts are just a few of the states that require annual report filings between January and May.  And some states have hefty late penalties.  A late payment of the Delaware LLC or LP tax yields a nearly 100% penalty.  In Florida, a $150 annual report fee increases by a whopping $400 if the deadline is missed.

Keeping up with annual filings is an important first line of defense in maintaining an entity’s status and good standing. Make sure you’re only paying the fees and filing the reports that are actually required.