OLYMPIA, Wash. — New business owners across Washington state are being warned about a scam that has already cost victims more than $1.2 million.
Attorney General Bob Ferguson sent out an alert last week, saying that over the last three years, scammers have sent out hundreds of thousands of deceptive letters demanding payment for items that should be free or are available at a much lower price.
These letters are made to appear as though they are coming from the state and usually ask the business owner to pay for a Certificate of Status, Certificate of Existence or “labor law poster.”
Ferguson said that two businesses, CA Certificate Service doing business as WA Certificate Service and Labor Poster Compliance, are responsible for at least 210,784 letters in the state since March 2019.
The scammers specifically targeted Washington residents who recently registered a business. The letters would demand that the business owner pay $82.50 for a status certificate, which actually costs $20 through the Secretary of State, or the letters would demand $79.25 for a poster that is free from the state and the federal government.
Many business owners who fell victim to the scam were confused by the letters since they typically arrived in the mail just days after they were registered.
One victim, a Seattle-area business owner, got one of these letters in January 2020 after returning from a Christmas vacation. “I (stupidly) filled out the form and sent the payment without checking its validity,” the business owner told Ferguson’s office. They were able to put a stop to the payment in time but only after checking the Secretary of State’s website to learn it was a scam.
Ferguson’s office said that at least 14,743 Washington business owners paid the more-than-$82 status certificate cost, amounting to roughly $1.2 million. Another 318 businesses paid the poster cost, which amount to more than $25,000.
Anyone who receives a suspicious letter asking for money should research the company first. To file a complaint, head to the attorney general’s website or call 1-800-551-4636.
Ferguson’s office has already received more than 90 complaints about these particular letters.
On March 17, Ferguson filed consumer protection lawsuits against the two companies, saying that every letter violated the Consumer Protection Act. In addition to the lawsuits, Ferguson also filed for a preliminary injunction to shut down the companies in Washington and prevent further letters in the state while the lawsuits are ongoing.
Ferguson said in a statement, “My office is seeking to put a stop to these scammers and get Washington business owners their money back — with interest.”