Bad actors and abuse spur Wyoming lawmakers to consider tighter business regulations – WyoFile

Several years after an international spotlight illuminated the vulnerabilities of Wyoming’s business regulations and privacy laws, state lawmakers will consider a slate of bills in the 2025 general session aimed at preventing fraud and deterring bad actors. 

Between the state’s low filing fees, lenient regulations and high degree of privacy, Wyoming now outcompetes Delaware for the most corporate registrations per capita. But whether that legal framework enables abuse or unlawful activity has divided lawmakers in recent years, effectively thwarting legislative action. 

This spring, however, the Legislature’s Joint Corporations, Elections and Political Subdivisions Committee formed a business fraud working group which then drafted four pieces of legislation that will be up for consideration later this month. 

Part of the newfound push came from Secretary of State Chuck Gray, who urged the committee in March to take the topic up in the off-season months between sessions. Gray reiterated his concerns in May when his office dissolved three Wyoming entities flagged as instruments of North Korea by the Federal Bureau of Investigation.

“I am grateful for the collaborative effort from the business fraud working group,” Gray said in an October press release. “We were able to put forward and suggest several committee-sponsored bills aimed at preventing fraud and ensuring the integrity of businesses filed with our office.”

Fremont County Assessor Tara Berg also rang the alarm for the committee. In April, Berg told lawmakers about the various ways her office has identified fraudulent filings. In a few instances, local property owners discovered their addresses were being used without their knowledge or permission in business filings unrelated to them. 

“I spend a lot of time in my office trying to calm people down,” Berg told the committee, adding that she’s one of the only assessors with the staff and time to investigate suspicious business filings. 

“Just think about this,” Committee Chairman Sen. Cale Case (R-Lander) said. “One assessor in one county in the state. Maybe other assessors do the same thing, but this could be pretty big.”

Registered agent bills

Out-of-state entities are required by law to register with the secretary of state’s office before transacting business in Wyoming. Many use what’s called a registered agent — a person or company who acts as a representative for the company — to complete the requisite filings on their behalf. It is common in such instances for the registered agent to be the only individual identified in the paperwork, and thus be the only point of contact available to the state or any entity relying on the state’s documents.

This arrangement can shield the identity of the business owner or owners, even from the registered agents. In fact, it’s not unusual for registered agents to know very little about the companies they represent. 

Previous reporting by the Washington Post linked several registered agents in Wyoming to companies facing accusations of wrongdoing in international court cases. 

Three of the four committee bills up for consideration by lawmakers are aimed at registered agents. 

Senate File 55 – Third party filers would require third-party filers, such as registered agents, to register with the secretary of state’s office if they file more than 10 documents with the secretary of state in one calendar year.

The registration application would require a third-party filer’s legal name, home address, phone number, email address and a copy of a valid driver’s license or identification card. The application would also need to be notarized, executed and sworn under penalty of perjury. 

The bill has an exception for attorneys who are members of the Wyoming State Bar and certified public accountants — both of which commonly act as registered agents for their clients. 

Some committee members, however, questioned the value of the bill since state law already requires registered agents who represent 10 or more businesses to register as commercial registered agents with the state. 

“It seems like a lot of redundancy to me. Is this actually going to catch something, or is this just another fee and a little more green book action?”

Rep. Jeremy Haroldson (R-Wheatland) said at a November committee meeting.  

Requiring third-party filers — whether they’re already registered agents or not — to confirm with the secretary of state’s office “that they are who they say they are,” Gray said, will have “a deterrent effect.”

The committee voted 9-4 with one excused to adopt the legislation. 

Senate File 56 – Providing false information to registered agents would empower the state to administratively dissolve an entity that provides false or fraudulent information to a registered agent. 

Scott Meier, an attorney and commercial registered agent, spoke against the bill, arguing it should be up to the registered agent to confirm they are getting accurate information from their client. 

The secretary of state’s office seems “to be overworked and underpaid as it is,” Meier said. 

The committee unanimously voted to adopt the bill. 

Senate File 59 – Registered agents-release of records would allow a county assessor to request from the secretary of state’s office a copy of confidential records maintained by registered agents. 

In April, Berg told the committee she’d encountered resistance from registered agents when trying to get further information about a business filing. 

From late 2022 to early 2023, Berg said her office began noticing a significant increase in the number of businesses being registered at a single address in Lander. Her office soon learned there was a registered agent at the address, but didn’t get much further than that. 

“Upon contacting the registered agent we were told he could not provide us with any information about any of the businesses in question, none of the businesses were his, none were physically located at his property despite the fact that this address is listed as the principal office, he is only providing a WY address for the agency,” Berg wrote in a presentation for lawmakers. 

As of April 2024, there were 551 businesses registered at the address, Berg said. 

Meier, the attorney, told lawmakers there’s a reason for privacy in such matters. 

“The reason that things are confidential is because there is a business reason for confidentiality,” Meier said. “And despite what I hear from some of my favorite assessors and treasurers, it is not illegal to run a business in Wyoming when you have no assets and no location in Wyoming.” 

The legislation would require the assessor to keep the records confidential, but the committee also amended the bill to allow the release of those records to law enforcement for use in a criminal investigation or in the event of a court order. 

The committee voted 10-3 with one excused to adopt the legislation. 

Foreign adversaries 

Based on the information and affidavit provided by the FBI, Gray announced in May that his office dissolved three entities registered with the state — Culture Box LLC, Next Nets LLC and Blackish Tech, LLC. 

The three LLCs had provided false and fraudulent information on documents filed with the secretary of state’s office and were flagged as instruments of North Korea. 

“The communist, authoritarian Kim Jong Un regime has no place in Wyoming,” Gray said in a press release. 

In that process, Gray said, his office discovered that they could only administratively dissolve an entity owned by a foreign adversary if it had provided false or fraudulent information. 

House Bill 69 – Foreign adversary ownership or control of business entities would amend the grounds for dissolution to include foreign adversary ownership or control. 

The committee unanimously voted to adopt the bill. 

The general session starts Jan. 14.