State halts good-standing certificate scam against local businesses

PROVIDENCE – The state has halted a deceptive scheme that scammed more than 1,000 local businesses and nonprofit organizations into paying for a certificate for good standing that they thought was required by law, R.I. Attorney General Peter F. Neronha announced Wednesday.

Last year, the state filed a lawsuit against Centurion Filing Services LLC for perpetrating the scheme, violating the state’s Deceptive Trade Practices Act. The state at the time claimed Centurion solicited newly state-registered businesses and nonprofits stating that they needed to pay an $84.50 fee to secure a certificate of good standing to complete the registration process.

However, Rhode Island businesses are not required to obtain a certificate of good standing to complete registration with the R.I. Office of the Secretary of State, Neronha said.

After an agreement on Jan. 31 with the R.I. Superior Court, Centurion is required to pay back the businesses and nonprofits it scammed up to $104,000 in restitution and a $25,000 fine to the state. Neronha also said Centurion will also be banned from any future solicitation by mail in Rhode Island.

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Neronha also said his office will mail to impacted businesses and nonprofits notices and restitution claim forms for them to seek refunds. Completed claims are due to Neronha’s office by April 28 either by regular mail or email.

“This office is committed to ensuring a fair and honest marketplace for local businesses and consumers by going after businesses that don’t play by the rules and undermine fair competition for everyone else,” Neronha said in a statement.

James Bessette is the PBN special projects editor, and also covers the nonprofit and education sectors. You may reach him at Bessette@PBN.com. You may also follow him on Twitter at @James_Bessette.