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Misleading mail targets new business owners & requests payment not owed

Published: Mar. 10, 2021 at 7:00 PM CST
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MADISON, Wis. (WMTV) - The Wisconsin Better Business Bureau and the state Department of Financial Institutions is warning businesses about a misleading letter.

The target is new businesses, mainly those that recently filed LLC paperwork with the state. The letter appears to come from the Secretary of State and requests a payment of more than $70 for a “Certificate of Status”.

Once a company files paperwork with the state it becomes public record. It appears scammers are targeting these businesses and trying to solicit payments for paperwork they likely already paid for when registering their businesses.

NBC15 Investigates spoke to two local business owners who received the letter. One is a college student at UW-Eau Claire who recently started selling earrings to make some extra cash.

“I started my business because I kind of had an obsession with buying earrings...I figured if I started making my own I could save money,” said Nicole Varese, owner of Earrings 4 You by Nicole, an online Etsy shop.

A family member helped her with all the paperwork to make her business official. A few weeks later, she received a letter in the mail.

“It looked pretty official,” said Nicole. It was from “WI Certificate Service” and had all her business info on it.

The letter was requesting payment of $72.50. Nicole didn’t understand why because she had already paid her registration fees.

A closer look revealed the letter wasn’t from a state agency at all. The sender’s info was not legitimate. With the help of family, she reported it to the Better Business Bureau.

Now, the BBB and DFI are issuing warnings about this.

“Any business owner who is excited to launch their business, they’re waiting for follow up paperwork and they’re receiving this...they may go ahead and pay for it because it does look official,” said Tiffany Schultz, Southwest Wisconsin Regional Director of the BBB.

NBC15 Investigates also spoke to another local business owner about a similar letter.

Steve Boelter of Boelter Consulting, LLC recently filed some paperwork for a client to register as an LLC. This included paying required feeds.

“About 10 days later, my client received a letter stating there was another $78.50 fee due,” said Boelter.

He said the letter was pretty convincing. “The more I looked at it, there were some tell signs it was not legitimate,” he said.

When he realized it wasn’t he also reported it to the BBB.

“Unfortunately with technology today anybody can make something like that that looks very professional and legitimate,” said Boelter.

The Wisconsin Department of Financial Institutions now has a warning about the misleading solicitation on its main web page.

There is a $10 fee from DFI to obtain an official certificate of status online. The department says this letter is solicitation and it’s not a valid invoice. Businesses are advised not to pay it.

Recommendations from the BBB to avoid falling victim to a misleading solicitation:

• Have a solid internal control process for paying invoices. Carefully check invoices against an improved vendor list prior to processing them for payment.
• Train employees to follow internal processes and never pay invoices before vetting them and getting authorization to pay.
• Question any invoice that does not look familiar and does not match an approved vendor list.

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