Company Accused of Misleading Mailings Leaves N.C.
A California company that sent questionable letters to hundreds of North Carolina businesses in violation of an earlier agreement is now permanently out of business in the state, Attorney General Roy Cooper and Secretary of State Elaine Marshall announced.
"Trying to trick small business owners and violating legal agreements aren't the way to do business in North Carolina," Cooper said. "We're pleased that we've kept hundreds of businesses from losing money to this scheme, and put a stop to this activity in North Carolina for good."
"This is a case where we gave a company the chance to stop misleading North Carolina employers and businesses, and they blew it," N.C. Secretary of State Elaine F. Marshall said. "The bottom line is that we are not going to allow anyone to send out advertising that tries to pass itself off as official government correspondence when it is not."
In 2009, Cooper and Marshall filed suit against Corporate Services Inc. and owner Selwyn J. Monarch for misleading North Carolina businesses into thinking they had failed to comply with state laws on taking and filing corporate minutes. The letters gave the appearance of coming from a government agency and directed businesses to pay $125 and provide information on their corporate minutes by a certain date. The state won a temporary restraining order and preliminary injunction against the defendants.
In March 2011, Corporate Services entered into a settlement with Cooper and Marshall that barred it from sending misleading mailings and paid $25,000 to the state. But later that spring, Corporate Services sent another mailing out to hundreds of businesses across North Carolina, a mailing the state alleges violated the settlement agreement.
The company initially claimed that the latest mailings were sent by mistake, but has now agreed to return checks worth approximately $90,000 to some 700 North Carolina businesses that responded to the mailing. Under an agreement signed this week with the Attorney General's and Secretary of State's offices, Corporate Services will also stop doing business in North Carolina and pay $30,000 to the state.
Cooper encourages businesses or consumers that get questionable letters demanding unusual fees to contact the Attorney General's Consumer Protection Division at (877) 5-NO-SCAM toll-free within North Carolina or file a consumer complaint at www.nc doj.gov.
In its mailings, Corporate Services referenced laws in Chapter 55 of the North Carolina General Statutes which are enforced by the North Carolina Secretary of State. The Secretary of State's Office does not issue letters like the ones sent by Corporate Services, nor does the agency collect fees from corporations for failing to keep or file corporate minutes.
Anyone wishing to check on the status of their corporation, limited liability company, or other business entity can go to www.sosnc.com or call the Corporations Division at (919) 807-2225.
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