Showing posts with label California. Show all posts

Beginning January 1, 2012, several legislative changes to Statement of Information (SOI) filings in California will go into effect as a result of AB 657.  The California Secretary of State (CA SOS) is currently revising its filing forms and sample packets in order to reflect the new requirements, and expect that the updated documents will be available on their website during the first week of January. The CA SOS has plans to phase in additional system changes over the coming months, and we'll be sure to notify our clients as we become aware of the changes being implemented.

Currently processing documents submitted back in August, the CA SOS points out that only expedite documents and some documents submitted electronically will be affected immediately. The office will continue to accept mailed in SOIs submitted on the old forms after January 1st; however, customers are encouraged to use the new forms as soon as they are available to ensure documents are not rejected for using outdated forms.

The below text, taken from an email from the CA SOS, highlights some of the changes that will be implemented:


Corporate Statements of Information:

• The entity number will be required in addition to the entity name.
• Foreign corporations must now file a 90-day initial Statement of Information (the same as other corporation types and LLC's).
• Filers will have the option of providing an email address only for the purpose of us sending them notifications (reminders, delinquency notices, etc.).
• Nonprofit corporations formed to manage a common interest development (CID) will no longer be required to provide any CID related information on the Statement of Information, other than having to check the box stating they are a common interest development; all CID information will still be required on the Statement by Common Interest Development Association that accompanies the Statement of Information, as applicable.

Statements by Common Interest Development Association:

• The street address of the business or association's corporate office, if any, must be included.

Limited Liability Company (LLC) Statements of Information:

• LLC's are to include a mailing address, if different from the street address of the principle executive office. 
• Filers will have the option of providing an email address only for the purpose of us sending them notifications (reminders, delinquency notices, etc.)

Articles of Incorporation for Nonprofit (Common Interest Development) Corporations:

• Filers no longer have to provide the nine-digit zip code associated with the association's location in the articles of incorporation.

If you have questions about any of these changes, feel free to call and speak to one of our knowledgeable account executives. We can be reached at 1.800.533.7272.

About the author: Ian Sierchio came to Parasec with over seven years experience in the medical and advertising industries. After his years in the advertising industry, on both the state and national levels, he decided to transition into the legal field as a way of satisfying his insatiable thirst for knowledge. Parasec and the wide breadth of its covered service areas have not disappointed. With Parasec’s many departments, covering work in many states, Ian has a never-ending area in which to learn and grow. In addition, spearheading our research and development allows him to uncover new service areas moving forward.


On January 1, 2009, a bill (SB 133) regulating the marketing of title insurance went into effect in California. As a result, solicitation of title business from real estate brokers and agents has been restricted heavily in the hopes of limiting activities which would induce referrals. There are arguments for and against this law, and the trickle-down effect it has had on the real-estate industry. Other states are taking notice of the changes and it is likely that similar bills will be introduced across the nation.


The summary statement from the bill reads as follows: “Would establish procedures for obtaining and renewing a certificate of registration as a title marketing representative, as specified; prohibit a person from marketing, offering, soliciting, negotiating, or selling title insurance in California without a valid certificate of registration as a title marketing representative; and place limits on the value of items that title marketing representatives are allowed to provide to those in a position to refer business to the title insurers they represent.”

This means that all title company sales or title representatives are now required to be licensed with the California Department of Insurance (CDI). The reps as well as the title companies themselves are now subject to fines. Additionally, the reps are also subject to suspensions/revocations if found in violation of the law. If a rep’s license is revoked, the offender cannot reapply for five years from the date of revocation.

Prior to SB 133, the CDI had no enforcement authority over the individual title marketing representatives who engaged in illegal rebating activities. While these practices were still technically illegal, the department only had the ability to fine the title insurers. The CDI is now authorized to bring administrative actions against the sales reps and title insurers who engage in these practices.

One fear was that this type of activity could be viewed in some cases as commercial bribery, which is a crime under the California Penal Code. Another fear is how expensive these “crimes” can be for a title company, which can be fined up to five times the amount of the expense. The law establishes zero tolerance for enticing realtors and lenders with anything that can be construed as an inducement to refer title business. This includes:

· Providing meals
· Purchasing tickets to sporting events
· Purchasing advertising on behalf of an agent or broker
· Creating/providing marketing materials on behalf of an agent or broker
· Distributing any item with monetary value (gift cards, event tickets, car washes, etc)
· Providing unlawful rebates (quote or charge under their filed rate with state of CA)

Many title companies, which have provided “accommodation” work in the past at no charge to law firms, lenders and other real estate-related companies; are now afraid these services could be a violation of the law. Not willing to expose themselves to the potential risks involved, they’re turning to Parasec and other public records filing and retrieval companies, which are then supplying companies with these types of documents.

With the filing and retrieval of deeds no longer being performed gratis, our industry is seeing an influx of outside referrals from our title company clientele. The title companies want to help, but to do so directly exposes them in a way they are not willing to risk. Real estate law firms, lenders and others are now left to fend for themselves while attempting to deal directly with other counties and even states in certain situations They’re spending precious time, money and manpower on a service they’ve been handed for years.

Parasec offers a variety of commercial title support and real-estate-related services to a wide range of businesses, including title companies, developers, lenders, asset managers, pension advisors, real estate attorneys, investors and banks. Title companies certainly offer many of the services Parasec specializes in, but we find that even title companies choose to outsource this “accommodation” work to us.

With the enactment of this law, we are finding new services we can assist with on a regular basis. Parasec is not a title company and this type of accommodation work is what we specialize in. We do not insure or underwrite projects in any way—we simply provide the accurate and timely information needed for the job at hand. From a standard Chain of Title report to a Full Commercial Search to simple Mechanics Lien searches, Parasec is happy to assist you in California and every other state.

Throughout the years, the California Secretary of State (CA SOS) has issued many customer alerts regarding deceptive solicitations aimed at those doing business in the Golden State. In fact, the attorney general has received upwards of 1,000 complaints regarding these fraudulent solicitations. Most of the scams have involved similar tactics, including the mailing of official-looking documents warning that if the forms are not returned with payment by a certain date, the companies will risk loss of their status with the state of California. The fees requested in the scams have sometimes been as high as $495.

There is currently a bill (AB 75) making its way through the legislature that would require third-party vendors to include more obvious disclaimers on their solicitations. The disclaimers would make it clear that the documents received are not government documents—hopefully preventing more businesses from falling prey to these types of scams.

Secretary of State Debra Bowen is requesting support to ensure AB 75 makes it to the Governor's desk and is signed into law. Bowen is urging Californians to submit support letters to their legislative representatives. To view several sample letters urging your chamber to support this legislation, go here.

Parasec has been working for at least the past couple of years to get the word out about these ongoing scams and will continue to try to warn our clients about the potential for being deceived by these clever scam artists. Please feel free to give us a call at 1.800.533.7272 if you have any questions about documents you have received.

The California Secretary of State (CA SOS) recently issued an alert regarding a private company claiming to offer online notarization. The company has sent misleading information and made false claims that its new web-based platform allows a person to submit copies of identification using a webcam in lieu of appearing in person. The CA SOS wants to stress that appearance via webcam is not a permissible option and that online notarization services are not legal in California. Read the complete customer alert here.

According to a blurb in a recent issue of the California State License Board’s (CSLB) newsletter, recent changes to the California mechanic’s lien law will soon require contractors, subcontractors and suppliers to provide property owners with a Notice of Mechanic’s Lien. In addition, a Proof of Service Affidavit must also be completed, signed and delivered to the property owner. The new requirements will take effect January 1, 2011, and failure to comply with them will render the mechanic’s lien unenforceable.

The changes come about as a result of Assembly Bill 457, which can be read in its entirety here.