Consumers must remain vigilant when it comes to government imposters
DES MOINES - Iowa Attorney General Tom Miller has reached a settlement with a Florida operation resolving allegations the company and its owner violated the Consumer Fraud Act by sending mailers that appeared to be from government agencies to Iowans in an attempt to sell unnecessary documents.
Centurion Filing Services and owner Dean G. Marshlack agreed to provide $78,900 in refunds to more than 1,200 Iowa business owners and charity operators, refrain from sending mailer solicitations to Iowans or from any Iowa location, and immediately cease sharing any identifying or personal information from businesses and charities that responded to the company’s solicitations.
“Centurion misled Iowa businesses and charities during a time when many were already struggling amid the pandemic,” Miller said. “We are pleased to come to a resolution with Centurion that provides refunds to Iowa businesses and charities. While Centurion may no longer be in the business of sending deceptive mailers in our state, that doesn't mean consumers should let their guard down. Read all mailers carefully and contact government agencies if you are unsure if these letters are legitimate.”
In November 2020, the state sued Centurion Filing Services and Marshlack alleging that the St. Petersburg, Fla., company violated the Iowa Consumer Fraud Act.
According to the lawsuit, Centurion — using the name “IA Certificate Service” and a Des Moines address from a UPS Store — sent out at least 7,170 mailers to Iowa business owners. The letters looked like invoices and stated that “your articles have been filed with the secretary of state and are complete,” and instructed businesses to order a “Iowa Certificate of Existence” for $67.50.
However, business certificates of existence are available directly from the Iowa Secretary of State for only $5. Such a certificate is not required to become an “official” business or to transact business in Iowa, although companies may need it to do business out of state, secure a loan from a financial institution, or for other limited circumstances.
As a result of the deception, many business owners believed that the letter was from the Secretary of State and obtaining the certificate of existence was necessary. Consumers who purchased the certificates paid a markup of over 1000% from the $5 fee.
Under the agreement, Centurion will provide $62.50 per transaction to every Iowa consumer who purchased certificates of existence for their businesses and charities and were not previously refunded by the defendants. The total amount to be reimbursed to Iowans will be $78,900.00. The per transaction refund covers all amounts paid by Iowans beyond the actual $5 cost of certificates. In all, 1,263 transactions were completed, according to the settlement.
The AG’s Office will send refunds directly to Iowa business owners and charity operators beginning in March. The envelope will include information about the settlement, and consumers who wish to verify the check is legitimately from the Iowa Attorney General’s Office may call the enclosed number.
Business owners: beware of imposter scams
Scammers attempting to bilk money from unsuspecting business owners is nothing new. The Federal Trade Commission warns that many outfits attempt to confuse many new business and charity owners with official looking invoices and correspondence.
In many cases, these mailers look official, often using a government seal, a business identification number and a plea that unless a quick payment is made your business will be put on hold.
To avoid these types of scams, the FTC suggests business owners:
Spread the word. The best defense is to be sure everyone at your workplace knows about this scam and how it works. Scammers often target several people in an organization to create confusion. Are you part of a business networking group or service organization? Help your fellow businesspeople and fill them in on these schemes.
Check all invoices closely. Be sure that you have clear procedures to approve expenditures, and that major spending can’t be triggered by an unexpected call, email, or invoice. If you get one of these mailers, you may need to check in with the people on your staff who are responsible for filing legal documents with the state.
Pay attention to how you pay. If someone tells you to pay with a wire transfer, reloadable card, gift card, or bitcoin, you can bet it’s a scam.
Protect sensitive information. Businesses should be extra vigilant so that scammers running such operations do not acquire sensitive financial information, including checking account numbers, that could be used for other fraudulent purposes apart from taking money.