(Phoenix, Ariz. - April 7, 2010) Attorney General Terry Goddard has today announced a lawsuit alleging deceptive business practices against Vahe Zakaryan, 45, of Glendale, Calif., whose business operated under the name of Board of Business Compliance. The lawsuit is the latest action in the Attorney General’s crackdown on deceptive businesses.
The lawsuit alleges that from July to November in 2008, the Board of Business Compliance led corporations to believe that its mailed solicitations “required response and payment or the shareholders would not be in compliance with Arizona law, and could be held liable for corporate debts and obligations.”
The solicitations stated that each business needed to pay fees in the amount of $125 for the preparation of annual minutes. The form enclosed with the solicitation looked official and included the “Corporation Number” assigned to the business by the Corporation Commission. However, the address was a private mail box located at a Phoenix UPS store and not the address of the Arizona Corporation Commission.
Over a five-month period, Zakaryan collected $68,000 from 552 Arizona corporations.
“I am committed to fighting scam artists who target legitimate Arizona businesses,” Goddard stated. “Business owners completed the Board of Business Compliance form and paid the fee in good faith, believing it was required by law, only to end up lining the pockets of an individual who provided no service whatsoever.”
The lawsuit alleges that the actions of the Board of Business Compliance violated the Arizona Consumer Fraud Act by:
- Operating under a fictitious business name which was designed to resemble the name of a government entity.
- Misleading businesses into filing a form and submitting $125 payment for annual minutes to comply with a non-existent Arizona law.
In the lawsuit, Goddard asks the court to order Vahe Zakaryan to:
- Refrain from violating the Arizona Consumer Fraud Act.
- Refrain from operating or soliciting any future business services in Arizona.
- Pay full restitution to all Arizona businesses that paid the fee.
- Pay the State of Arizona a civil penalty of up to $10,000 for each violation of the Consumer Fraud Act.
- Reimburse the Attorney General’s Office for its costs of investigation and legal fees incurred in this matter.
Assistant Attorney General Rebecca Salisbury is prosecuting this case.
The Attorney General’s Office filed a similar lawsuit last September against Y.M.S., Inc., a Nevada corporation doing business as “Arizona Corporate Headquarters,” its president and vice president. The defendants are accused of collecting more than $350,000 in fraudulent $125 fees from some 2,800 Arizona businesses. That suit is still in discovery.
If you believe you have been a victim of fraud, please contact the Attorney General’s Office in Phoenix at 602.542.5763, in Tucson at 520.628.6504 or outside the Phoenix and Tucson metro areas at 1.800.352.8431. To file a complaint in person, the Attorney General’s Office has satellite offices throughout Arizona with volunteers available to help. Locations and hours are posted on the Attorney General’s Web site, www.azag.gov. An online complaint form is also posted on the Attorney General’s Web site.
A copy of the lawsuit is attached. For additional information, contact Molly Edwards at 602-542-8019.