How Can You Protect Yourself and Your Business? What Is A Fraudulent Business Filing?
The phrase is relatively self-explanatory: any business filing obtained, changed, or filed without authorization and/or involving deception, dishonesty, or illegal intentions. In Colorado, fraudulent filings are made when there is unfair or deceptive trade practices as defined under the 'Colorado Consumer Protection Act.'
Two Types of Business Identity Theft
- Fraudulent Use of Existing Business Records
- Unauthorized changes to business information with the state registering body, often the Secretary of State. These deceptive filings are often referred to as "Business Identity Theft."
- Fraudulent Use of An Address or Name
- Business registered with the state using an unauthorized address.
- Business registered with the state with unauthorized use of the name of an individual or entity.
The Consequences
If your business records, name, or address have been used for nefarious purposes, the results can be dire, including unauthorized debts and fraudulent tax return filings. In March, the Federal Trade Commission (FTC) reported a 25% increase in fraud in 2024, underscoring the urgency of this issue. In addition to monetary losses, you could lose access to your state accounts, important mail, and customer trust.
Prevention of Theft
To prevent theft when registering your business, check if your Secretary of State (or other registering body) offers secure filing. This often requires a secure login to proceed with filings. Utilize a registered agent service to maintain the privacy of your personal information.
In the digital age, it is challenging to keep your information off the internet. Keeping software on critical components of your technology up to date, as well as using anti-virus and malware software. The Social Security Administration (SSA) has recently updated a post with tips on how to protect your personal information online.
Remedies For Theft
In light of recent reports, several states, including Arizona, Colorado, Ohio, and Mississippi, have provided information and methods for consumers and business owners to report fraudulent activity. In recent months, Colorado has become very active in the fight against theft.
Effective July 1, 2025, Colorado is taking a proactive stance against fraudsters with new requirements for registered agents in the state. The new requirements make it more difficult for fraudsters to steal information from unsuspecting businesses and citizens by requiring residency verification.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
