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Beware: Small Business Scams on the Rise

by | Jan 9, 2024 | Small Business |

In 2023 we noticed a significant increase in scammers targeting small business with official-looking notices and other correspondence.

Many fly-by-night companies have sent solicitations to Minnesota businesses that at first glance appear to be official mailings from a government agency, and imply the businesses must pay a fee to comply with annual meeting, minutes, or reporting requirements.

What should I be aware of?

Here are some examples of common scams to be aware of:

  • Workplace Posters – The letters offer to provide minimum wage and other required posters for an unnecessary fee. The Department of Labor and Industry website provides free labor law/workplace posters, which you can print yourself.
  • Annual Renewal – Letters offering to submit your business’s Annual Renewal with the Secretary of State for hundreds of dollars should be disregarded. We offer this service for $75, or if you’re a “do-it-yourself” person, the renewal can be submitted on the Secretary of State’s website.
  • Certificate of Good Standing – Some letters offer to provide a copy of your business’s Certificate of Good Standing for hundreds of dollars. These are only required in certain circumstances, and we offer this service for $75. Contact us if you think you might need a Certificate of Good Standing, or if you’d prefer to obtain one yourself, they’re available on the Secretary of State’s website.
  • Confidential Information – Requests for confidential information to update your business’s information or apply for a “state benefit” should be reported. Any confidential information related to your business, including officer names and addresses, bank account information, etc., should not be disclosed to anyone over the phone or in a letter.
  • Record Keeping – Official-looking solicitations with quotations pulled from state laws for expensive record-keeping services. State law does not require that you pay for these services.

What should I do to avoid these scams?

The fine print on these letters may disclose that the services they offer are not required by law, but the shady companies that send these solicitations count on the fact that you’re busy and may not notice the fine print disclaimer. Here are a few tips to spot these scams:

  • Read the letter carefully to find out who actually sent it, and what’s being offered;
  • Keep a list of required registrations and fees handy; and
  • Keep track of when renewals are due.

When in doubt, do not respond before contacting us at (763) 582-1414 to verify that the fee or information request is legitimate. We understand how hard it is to run a business, and are here to help avoid these scams.