Letter wants money for state certificate, nonprofit founder sees through fine print

Investigations

KNOXVILLE, Tenn. (WATE) – A just-opened nonprofit in Pigeon Forge received a letter requesting money to get a state certificate.

The notice looked like it came from the state – but upon reading the fine print, turns out – it didn’t.

The operator of the nonprofit called WATE 6 On Your Side to investigate and to warn others about the letter’s contents.

The letter deals with what’s called a certificate of existence. A certificate of good standing in Tennessee is also called a certificate of existence, according to the Secretary of Stat’s office.

It’s used by a registered business or nonprofit to prove that they are legally authorized to transact business.

A certificate of existence is not like a business license, which must be obtained to legally conduct business.

The letter sent to the newly opened nonprofit in Pigeon Forge looked a little shy.

Justin Johnson works at First Baptist Church in Pigeon Forge. In mid-August, Justin established a nonprofit missionary group called Hope 3:16. He paid a fee and registered it with the state. Then within a few weeks, he received a Certificate of Existence request form which looked like it could have been from the state.

To receive the certificate, there’s a fee of $83.50 – but the form didn’t look right to Johnson.

“I didn’t expect it at all because it was not in the steps we were trying to follow. My initial thought was, ‘I can’t believe I’m getting hit with yet another invoice,'” he said. “But I noticed some things about it that were off. First of all, the seal on the top left hand corner was something like it was pulled off Microsoft Office or something. The email address was not something familiar that I had seen from the Secretary of State. Then of course, they contradicted themselves in the letter saying this is issued by the Secretary of State, but then at the bottom it says it’s not a government agency, so..”

Tony Binkley, the President/CEO of the Better Business Bureau of Greater East Tennessee was contacted by Johnson. Binkley noticed even more errors in the letter sent to Johnson and shared.

“You have Secretary of State here non-capitalized, then Secretary of State here and it’s capitalized. So there is just inconsistencies,” Binkley said.

Last December we reported another letter that was brought to the bureau’s attention, it was an annual business report sent to a store in Gatlinburg.

“They’re making this look like an Annual Report and are asking the businesses to file this and send a fee of $95,” Binkley said.

Binkley also adding that there’s no $95 fee for an Annual Report if you go to the Secretary of State’s Website. The business in Gatlinburg did not send any money to this UPS store on West End Avenue in Nashville — it’s listed as the address for both the Certificate of Existence and the Annual Report.

“Where that particular scam was targeting any business in the state this one seems to be targeting newly registered businesses,” Binkley said.

At First Baptist Pigeon Forge, Johnson pulled up the Secretary of State’s website where you can request a Certificate of Existence for a fee of only $20. Johnson is glad he didn’t waste the $83 by sending money to that for-profit business in Nashville.

“It’s unfair for someone who doesn’t know what they’re doing and they’ll going to fall for it. They’re going to be out money they can’t get back,” Johnson said.

Obtaining a certificate of existence is not necessarily required by all Tennessee businesses. Instead, it’s an elective certificate and only necessary when opening a bank account or setting up a debit or credit card processing payment system, according to the state.

Through the Secretary of State’s office, the cost of a certificate is normally $20 for normal processing, plus a $2.25 convenience fee when ordering online.

Copyright 2019 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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