Businesses targeted in name renewal service

April 5, 2012 11:34:22 AM PDT
If you own a business you may get an official-looking notice in the mail. It's an enticement to renew your fictitious business name, but you should know who it is really from.

There are private companies that offer to file documents for you, but watch out because they can charge hefty fees, well above what the government charges for filing a simple form.

Magnus Akerblom owns a remodeling business called Anchor Construction. It is a proud name he has used since 1996 and he intends to keep it. So an urgent notice caught his attention.

"It looks like a government form, it really does," said Akerblom.

The document warns that Akerblom's fictitious business name was about to expire. By law the name must be renewed every five years or someone else could claim it.

"Oh yeah, it looks very official and they put little file numbers and things on there," said Akerblom.

The notice tells Akerblom to complete the form right away and mail it in with a payment of $150.

"I can understand someone who receives this notification being confused," said San Mateo County recorder Mark Church.

Church is the one in charge of registering fictitious business names. As he points out the notice is not official at all.

"I see this as a private company that is trying to make a quick profit," said Church.

Fictitious Business Name Renewal Center is a private company, not a government agency. It charges $150 to renew a business name, but that is four times higher than the county's renewal fee of just $34.

Not only that, Church says about 10 businesses in the past month reported they paid the company, but the county never received the proper renewal forms and some did not include the $34 filing fee.

"That's when they learned that their business name had not been renewed and they indicated to us, they'd already sent the $150 to this company," said Church.

Akerblom did not send any money to the company, but he did contact 7 On Your Side and we found Fictitious Business Renewal Center has an "F" rating with the Better Business Bureau and more than a dozen complaints are posted online.

We spoke with company attorney Grant Teeple. He said this is a legitimate business, saying, "A lot of people want professional help to make sure [the renewal] is done right. Only 1 percent or less [of customers] think we're the government. Ninety-nine percent are not fooled. If they feel like they were confused, we'll give their money back."

Teeple also said the company will give refunds to anyone who paid the fee, but did not get a renewal.

The company's solicitation does include a disclaimer in small print at the bottom saying, "This service has not been approved or endorsed by any government agency and this offer is not being made by an agency of the government. This is not a bill, it's a solicitation."

County recorders around the Bay Area said they have received scattered reports from customers who also received the solicitations. Church says it is not necessary to pay a company to renew your business name and the process stakes about five minutes.

"You're dealing with someone who's solicited you, you don't know who they are, and for a rather high fee," said Church.

"I don't know how much of this goes on or how many people pay these things, but that's the reason I called, because I think that others should have warning," said Akerblom.

The District Attorney's office in San Mateo County said it could not discuss the legality of these solicitations. By law companies must make it clear they are not government agencies. If you paid a fee and did not get your documents filed, let me know about it.

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