8 ms·

2000 shell companies at one address in Wyoming

113 points by hendler 15y ago

zach 15y ago
Wait until you hear about 2711 Centerville Road, Wilmington, Delaware. Such shady entities registered there include "Level 3 Communications", "California Pizza Kitchen", "The Walt Disney Company", "Dole Food" and "Qualcomm". Seriously, all those companies are Delaware corporations who maintain their registered office at that address, despite the fact that their CEO has probably never visited that address in their lives. This is such a common occurrence that it hardly merits notice. Even if you throw in the observation that dubious businesses favor incorporation in Wyoming (which has no corporate income tax, franchise tax or tax on corporate shares), that's still not saying much.
- Joakal 15y ago
  If you think that's bad, several major 'USA' companies are lobbying USA congress for a tax break as an incentive to return money back to USA from tax havens [0]. [0] http://www.bloomberg.com/news/2011-06-28/biggest-tax-avoiders-win-most-gaming-1-trillion-u-s-tax-break.html http://www.bloomberg.com/news/2011-06-28/biggest-tax-avoider...
  - OstiaAntica 15y ago
    Why should the U.S. tax capital, earned outside of the U.S., when it is invested back in America?
    - econgeeker 15y ago
      In fact, since repatriated capital will be deployed inside the US, likely to produce more profits which can then be taxed... taxing repatriated money is a drag on the economy and reduces future tax income. (I don't know if the effect is large or small, but I think it is large.)
    - runako 15y ago
      The current proposals don't require the money be invested in America. Most of it will likely be paid out to shareholders as dividends. The article the parent links to provides more discussion.
- ihodes 15y ago
  I'll be registering my company in Delaware. Why the hell wouldn't I?
  - georgieporgie 15y ago
    Because if you don't live in DE, it can be a pain if legal action ever comes up. I've read that the "home court advantage" is very real. Also, people often establish companies in tax-free states thinking that they'll avoid taxation. But nexus will bite you. By living in a state, or doing work in a state beyond sales, you establish nexus and are responsible for state income tax.
  - tzs 15y ago
    Why Delaware over the state you are in? (Assuming you aren't actually in Delaware).
    - dunham 15y ago
      They have a different legal system (a court of chancery) that businesses prefer when resolving disputes. See "Delaware Court of Chancery" on Wikipedia.
- jacques_chester 15y ago
  There's a nice golf course right behind that address. I imagine quite a few CEOs have stopped by.
semuelf 15y ago
I don't see the problem here. People are buying a shelf company for good credit score? it is the credit scoring that is defunct. fix it, and the problem will go away. People are using shell companies to hid assets? improve transparenty and book keeping rules. and so on.
joe42 15y ago
Business hackers.
- hendler 15y ago
  My favorite use of shell corporations in fiction so far is in Accelerando [1] - corporations start out as python scripts: [1] - http://www.amazon.com/Accelerando-Singularity-Charles-Stross/dp/0441014151/ref=sr_1_1?s=books&ie=UTF8&qid=1309324277&sr=1-1 http://www.amazon.com/Accelerando-Singularity-Charles-Stross...
  - JeremyBanks 15y ago
    Available for free on the author's website: http://www.antipope.org/charlie/blog-static/fiction/accelerando/accelerando-intro.html http://www.antipope.org/charlie/blog-static/fiction/accelera...
  - antihero 15y ago
    It would be good if one could do something along the lines of from legal.entities import Company jamestech = Company(address='2711 Wyoming Road') jamestech.register() That would be awesome.
- chopsueyar 15y ago
  If you consider somebody doing an auto-install of Wordpress on a managed host a hacker.
sdfjkl 15y ago
Such special purpose companies[1] are quite common and don't necessarily indicate any "shady" practices. [1] http://en.wikipedia.org/wiki/Special_purpose_entity http://en.wikipedia.org/wiki/Special_purpose_entity
cheez 15y ago
At some point, I hope people realize that the tax code is for the rich.
- chopsueyar 15y ago
  I think that is the problem the government has with these services. They are too affordable. Only $10k for an LLC from 1997, plus $2,500 to have attorney client privilege? Only the ultra-rich should be allowed to do stuff like this.
  - cheez 15y ago
    Pardon me but it only makes sense to do this if you are making mounds of cash. Otherwise the cost for compliance will easily eat up any excess profit. Even very profitable companies don't do this, so you should ask yourself why.
georgieporgie 15y ago
...and there are plenty of shared offices and pseudo-offices in the Embarcadero Center in San Francisco. Unexpected != shady. I started a Wyoming "close corporation" (unique to WY and awesome for small businesses) last spring, and used FreeRegisteredAgent.com aka Incorp.com as my registered agent. They do the first year free, $99/yr after that. They weren't the fastest responders, but when I dissolved the company a year later they did get back to me, and it didn't prove to be a scam. I don't have my numbers handy, but in the end I calculated that it would cost something like $1,000 per year to even begin to legitimize a presence in Wyoming. You'd need a mail forwarding service in the state, of which there are few. You'd also almost certainly want a state driver's license, and some of the mail forwarding and registered agent companies will let you use their address for that! Incidentally, I went with Wyoming because NV and DE have both started charging rather steep annual licensing fees. (the reason for all this, by the way, is because my plan was to live abroad and do some coding on the side, which puts me in a strange tax situation, and costs had to be extremely low.)
sivers 15y ago
I used Wyoming Corporate Services (the company at this address) to set up an LLC a couple years ago, and they were the most wonderful people to work with. (I would only contact them a few times a year, but when I did, the lady on the phone would remember me, "Oh hi Derek! How are things in the music biz?") Their service is 100% legit, they're prompt and friendly, and I recommend them highly. http://www.wyomingcompany.com/ http://www.wyomingcompany.com/ As most of us know here, there are many valid reasons to set up your corporation in a neutral place that is not your current residence. Maybe you're online-only and traveling the world. Maybe you're starting your business in one place for now, but you feel kinda "one foot out the door", and feel you're going to move it somewhere else some day. Or maybe just because you want to, it's legal, and you need no other reason than that.
- chopsueyar 15y ago
  As I was reading the article I thought about how trying to increase regulation of this type of activity would kill entrepreneurship in this country. The article had a negative slant to it, and there are legitimate benefits to this service. Perhaps some are upset because only the ultra-wealthy should be allowed such privilege? http://www.rollingstone.com/politics/news/the-real-housewives-of-wall-street-look-whos-cashing-in-on-the-bailout-20110411 http://www.rollingstone.com/politics/news/the-real-housewive...
  - davidw 15y ago
    In Italy, you have to have thousands of Euros available to start a limited liability company and it sucks. It's just a complete and total negative in my opinion. We can all argue about the ideal level of taxation, but don't tax companies until they're actually making money.
    - Blarat 15y ago
      And with some tax planning no company would pay any tax... It's pretty easy to hide profits in the books
rovar 15y ago
Seriously, how did this make the front page?
- Sukotto 15y ago
  I upvoted it based on the many extremely useful comments. Perhaps other people did too?
mynewcompany 15y ago
I think this article is inaccurate and overhyped. First of all, I run a similar company that does this in Nevada. We are the "Registered Agent" for thousands of companies. All it means is that we are the address the state can send their "Annual Report" paperwork to and a process server can deliver and have legal docs signed for. The Registered Agent must have an address in the state and be available during business hours. These aren't "shell" companies - every company in NV from Amazon to Zappos has to have an agent.

113 points by hendler 15y ago

zach 15y ago

Wait until you hear about 2711 Centerville Road, Wilmington, Delaware. Such shady entities registered there include "Level 3 Communications", "California Pizza Kitchen", "The Walt Disney Company", "Dole Food" and "Qualcomm". Seriously, all those companies are Delaware corporations who maintain their registered office at that address, despite the fact that their CEO has probably never visited that address in their lives. This is such a common occurrence that it hardly merits notice. Even if you throw in the observation that dubious businesses favor incorporation in Wyoming (which has no corporate income tax, franchise tax or tax on corporate shares), that's still not saying much.

Joakal 15y ago
If you think that's bad, several major 'USA' companies are lobbying USA congress for a tax break as an incentive to return money back to USA from tax havens [0]. [0] http://www.bloomberg.com/news/2011-06-28/biggest-tax-avoiders-win-most-gaming-1-trillion-u-s-tax-break.html http://www.bloomberg.com/news/2011-06-28/biggest-tax-avoider...
- OstiaAntica 15y ago
  Why should the U.S. tax capital, earned outside of the U.S., when it is invested back in America?
  - econgeeker 15y ago
    In fact, since repatriated capital will be deployed inside the US, likely to produce more profits which can then be taxed... taxing repatriated money is a drag on the economy and reduces future tax income. (I don't know if the effect is large or small, but I think it is large.)
  - runako 15y ago
    The current proposals don't require the money be invested in America. Most of it will likely be paid out to shareholders as dividends. The article the parent links to provides more discussion.
ihodes 15y ago
I'll be registering my company in Delaware. Why the hell wouldn't I?
- georgieporgie 15y ago
  Because if you don't live in DE, it can be a pain if legal action ever comes up. I've read that the "home court advantage" is very real. Also, people often establish companies in tax-free states thinking that they'll avoid taxation. But nexus will bite you. By living in a state, or doing work in a state beyond sales, you establish nexus and are responsible for state income tax.
- tzs 15y ago
  Why Delaware over the state you are in? (Assuming you aren't actually in Delaware).
  - dunham 15y ago
    They have a different legal system (a court of chancery) that businesses prefer when resolving disputes. See "Delaware Court of Chancery" on Wikipedia.
jacques_chester 15y ago
There's a nice golf course right behind that address. I imagine quite a few CEOs have stopped by.

semuelf 15y ago

I don't see the problem here. People are buying a shelf company for good credit score? it is the credit scoring that is defunct. fix it, and the problem will go away. People are using shell companies to hid assets? improve transparenty and book keeping rules. and so on.

joe42 15y ago

Business hackers.

hendler 15y ago
My favorite use of shell corporations in fiction so far is in Accelerando [1] - corporations start out as python scripts: [1] - http://www.amazon.com/Accelerando-Singularity-Charles-Stross/dp/0441014151/ref=sr_1_1?s=books&ie=UTF8&qid=1309324277&sr=1-1 http://www.amazon.com/Accelerando-Singularity-Charles-Stross...
- JeremyBanks 15y ago
  Available for free on the author's website: http://www.antipope.org/charlie/blog-static/fiction/accelerando/accelerando-intro.html http://www.antipope.org/charlie/blog-static/fiction/accelera...
- antihero 15y ago
  It would be good if one could do something along the lines of from legal.entities import Company jamestech = Company(address='2711 Wyoming Road') jamestech.register() That would be awesome.
chopsueyar 15y ago
If you consider somebody doing an auto-install of Wordpress on a managed host a hacker.

sdfjkl 15y ago

Such special purpose companies[1] are quite common and don't necessarily indicate any "shady" practices. [1] http://en.wikipedia.org/wiki/Special_purpose_entity http://en.wikipedia.org/wiki/Special_purpose_entity

cheez 15y ago

At some point, I hope people realize that the tax code is for the rich.

chopsueyar 15y ago
I think that is the problem the government has with these services. They are too affordable. Only $10k for an LLC from 1997, plus $2,500 to have attorney client privilege? Only the ultra-rich should be allowed to do stuff like this.
- cheez 15y ago
  Pardon me but it only makes sense to do this if you are making mounds of cash. Otherwise the cost for compliance will easily eat up any excess profit. Even very profitable companies don't do this, so you should ask yourself why.

georgieporgie 15y ago

...and there are plenty of shared offices and pseudo-offices in the Embarcadero Center in San Francisco. Unexpected != shady. I started a Wyoming "close corporation" (unique to WY and awesome for small businesses) last spring, and used FreeRegisteredAgent.com aka Incorp.com as my registered agent. They do the first year free, $99/yr after that. They weren't the fastest responders, but when I dissolved the company a year later they did get back to me, and it didn't prove to be a scam. I don't have my numbers handy, but in the end I calculated that it would cost something like $1,000 per year to even begin to legitimize a presence in Wyoming. You'd need a mail forwarding service in the state, of which there are few. You'd also almost certainly want a state driver's license, and some of the mail forwarding and registered agent companies will let you use their address for that! Incidentally, I went with Wyoming because NV and DE have both started charging rather steep annual licensing fees. (the reason for all this, by the way, is because my plan was to live abroad and do some coding on the side, which puts me in a strange tax situation, and costs had to be extremely low.)

sivers 15y ago

I used Wyoming Corporate Services (the company at this address) to set up an LLC a couple years ago, and they were the most wonderful people to work with. (I would only contact them a few times a year, but when I did, the lady on the phone would remember me, "Oh hi Derek! How are things in the music biz?") Their service is 100% legit, they're prompt and friendly, and I recommend them highly. http://www.wyomingcompany.com/ http://www.wyomingcompany.com/ As most of us know here, there are many valid reasons to set up your corporation in a neutral place that is not your current residence. Maybe you're online-only and traveling the world. Maybe you're starting your business in one place for now, but you feel kinda "one foot out the door", and feel you're going to move it somewhere else some day. Or maybe just because you want to, it's legal, and you need no other reason than that.

chopsueyar 15y ago
As I was reading the article I thought about how trying to increase regulation of this type of activity would kill entrepreneurship in this country. The article had a negative slant to it, and there are legitimate benefits to this service. Perhaps some are upset because only the ultra-wealthy should be allowed such privilege? http://www.rollingstone.com/politics/news/the-real-housewives-of-wall-street-look-whos-cashing-in-on-the-bailout-20110411 http://www.rollingstone.com/politics/news/the-real-housewive...
- davidw 15y ago
  In Italy, you have to have thousands of Euros available to start a limited liability company and it sucks. It's just a complete and total negative in my opinion. We can all argue about the ideal level of taxation, but don't tax companies until they're actually making money.
  - Blarat 15y ago
    And with some tax planning no company would pay any tax... It's pretty easy to hide profits in the books

rovar 15y ago

Seriously, how did this make the front page?

Sukotto 15y ago
I upvoted it based on the many extremely useful comments. Perhaps other people did too?

mynewcompany 15y ago

I think this article is inaccurate and overhyped. First of all, I run a similar company that does this in Nevada. We are the "Registered Agent" for thousands of companies. All it means is that we are the address the state can send their "Annual Report" paperwork to and a process server can deliver and have legal docs signed for. The Registered Agent must have an address in the state and be available during business hours. These aren't "shell" companies - every company in NV from Amazon to Zappos has to have an agent.