If you’re starting a business in California, you’ve likely run into a number of challenges. Building a company from the ground up is difficult enough without having to deal with would-be scammers. One relatively recent scam involves the fraudulent solicitation of money for what’s known as a “Certificate of Status.” If you aren’t sure whether a form you receive in the mail is actually a required form, or is a scam of some kind, reach out to San Jose business law firm Strategy Law, LLP before responding to the solicitation.
Starting a Business in California
When starting a business in California , you first need to determine whether your business will be a corporation, a limited liability company, a limited partnership, a general partnership, or a limited liability partnership. Next, you’ll need to file the appropriate paperwork. During the course of your business, you may need to obtain a California Certificate of Status, or Certificate of Good Standing. Obtaining a Certificate of Status can help your business obtain financing, get registered in another state and enter into certain business transactions.
Spotting False Solicitations
Some businesses in California have been receiving Certificate of Status solicitations from an entity that calls itself “California State Corporations.” These solicitations request $49.50 in exchange for a certificate of status. Only the California Secretary of State’s office can issue Certificates of Status to California businesses. If you receive a false solicitation from California State Corporations, you should consider speaking with a business attorney. Business attorneys can help you file an official complaint with the California Attorney General.
Obtaining a Legitimate Certificate of Status
So you know how to avoid falling victim to a false solicitation—how do you obtain a legitimate Certificate of Status from the Secretary of State? The process is simple. All you have to do is submit a formal request with the Secretary of State by mail or in person. The fee for a legitimate Certificate of Status is $5—substantially less than the nearly $50 requested by pretenders. You can also contact your business attorney to order the Certificate of Status for you. Oftentimes, a Certificate of Status is not necessary. When you are working with an attorney, your attorney will order the Certificate for you if required as part of a business transaction.