PROVIDENCE – A Florida company is using a city address and snail mail to deceive Rhode Island businesses into paying more for services that are offered by the R.I. Department of State, the department said Wednesday.
The company, Centurion Filing Services LLC, known locally as RI Certificate Service, issues certificates of good standing to newly incorporated Rhode Island businesses for $84.50. The certificates are issued by Department of State at a cost of $5. The Department of State said the company perpetrating the alleged scam files the certificate on behalf of a new Rhode Island business.
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Centurion Filing Services LLC settled with the Mississippi Attorney General Lynn Fitch’s office in early March for violating that state’s Consumer Protection Act by perpetrating a similar scheme. Consumers who paid Centurion in Mississippi for a Certificate of Existence can request a refund from the company.
Secretary of State Nellie Gorbea said her office learned of the company’s practices when she was in the process of dropping off her children at school. “One of the parents came up to me and said, ‘I got this notice from your office. Is this real?’ And I looked at it and said absolutely not.”
Gorbea said the parent let her keep the notice as evidence, and she took it back to her office to begin fully investigating the issue. What she uncovered was a scheme dating back to December that preyed on over 226 of the state’s businesses, 50 of which were in March alone.
“It’s very upsetting that there are businesses out there that are taking advantage of our Rhode Island small business community at a time like now,” said Gorbea. “It’s unconscionable. So, I want to alert business owners about this misleading scheme, so we can stop this overpaying for services that my office provides at a much lower cost.”
Gorbea said part of the challenge is that scammers “prey on people’s stereotypes about Rhode Island government” and the Department of State having a difficult process for filing articles of incorporation in the state.
That is not the case, she said. Gorbea said her office makes it easy and affordable for businesses to file articles of incorporation. The Department of State’s website has a business portal for that purpose.
“You don’t even have to come into our office,” she said. “We have done a lot to improve our website. There is a lot you can do online. Business owners tell me they love the Department of State website, because we’ve made it so easy.”
Gorbea said businesses that believe they are a victim of the scam should contact Attorney General Peter Neronha’s office to file a complaint.
“We’ve contacted the attorney general’s consumer protection unit,” said Gorbea. “And the AG’s office has served the Florida company with a civil investigative demand for violation of the Deceptive Trade Practices Act. They are currently building their case and gathering witness statements. So, if there are businesses out there that have paid for this service unwittingly, the attorney general’s office wants to hear from them.”
Centurion Filing Services LLC did not immediately respond to comment regarding its alleged violation of the Deceptive Trade Practices Act.
R.I. Attorney General Peter F. Neronha said his office “has seen instances like this before. A business masquerades as a government entity to make consumers believe they need to pay for something that the government provides either for free or at a much lower cost. It’s deceptive and it cheats unsuspecting consumers out of their hard-earned money. It’s our job to investigate these claims and, if appropriate, take action in court.”
Gorbea said that Rhode Island businesses in receipt of suspicious looking material should contact the Department of State. “It’s likely that it’s not coming from us,” she said, noting that her office has experienced other scam solicitations, such as “the recording of annual meeting minutes. A corporation doesn’t have to record its annual meeting minutes with our office.”
“Clearly this is a big issue for Rhode Island because small businesses are the backbone of the economy,” said Gorbea. “As Secretary of State I am going to defend them from these unscrupulous entities looking to grab their money.”
Gorbea encourages people with issues to call her office at: (401) 222-3040 or go to the Department of State website www.sos.ri.gov.
The Attorney General’s Consumer Protection Unit can be reached at: consumers@riag.ri.gov or by calling (401) 274-4400.
Cassius Shuman is a PBN staff writer. Email him at Shuman@PBN.com.
