Legally, there isn't much they have to do. The Registered Agent is just the person or company of record to which anyone can serve papers or formal notices meant for the corporation represented. Being available for such service and passing on such communications, are basically all the R.A. has to do by statute. Most charge the fee and barely provide any service at all. Recently, some have become less than useless. They've begun running a scam.
There are approximately 322,000 corporations resident in the State of Nevada, each paying fees to the various service providers. Apparently, some R.A. firms have decided they needed a bigger slice of that pie - whether they are actually asked to do it, or not. Their methods are bold and simple.
1. The Clawback
Usually when you incorporate in Nevada, you might use a service which does little else. They tend to charge much less than attorneys, and their focus on the single activity of incorporation often makes them better and more efficient at the task than is a typical law firm. Incorporation firms also act as resident agent for the companies they start, which is the real source of profits and ongoing income. Because a company has to pay a state fee to change its registered agent, the R.A. firm can count on continued business once they have it.
The claw back comes when you have replaced the R.A. firm with your own R.A, as is often the case with people who live in Nevada. Some firms are using the credit card on file for the original incorporation, and charging a registered agent fee and registered agent change fee. They are even filing the forms without any further consent of the corporation. They usually point to their original agreement to act as R.A, typically for the first year or six months, as cover for the scam.
By keeping the credit cards on file, they 'claw back' the R.A. position by billing you later without your consent. Try to cancel, and your bank will likely not believe you, as they see that the firm is in fact the R.A. for the corporation after the billing.
2. The Renewal Hustle
Some firms are enjoying a tremendous business by calling on corporate officers when their company is close to, or past its due date for filing of the annual list of officers required by the state. These R.A. firms take advantage of the situation by knowing that most of the corporations are small, closely held companies and LLC's controlled by one or two people. They call from a boiler room and use official-sounding names, often with the name of the State or County in the name of their private firm. They tell you that you are "in default" or "in violation" and that you will be fined an additional fee by the state of Nevada unless you renew right away. They quote you a price which includes the renewal (list of officers filing fee) and their own fee. You provide your credit card information, and they have you.
Once they have attain the position of R.A, you can't get away from them without paying another fee to the State of Nevada. This helps keep them in the game. Unless you have someone to perform the service in Nevada for less, why would you change once they've already grabbed your cash? They bank on the confusion, misdirection, state fee structure and inept credit card administration companies.
Please comment with your own experiences regarding registered agent scams, whether in Nevada or any other state or country. We want to hear about it.
