Secretary’s working group proposes multiple options on registered‑agent fraud and BOI; stakeholders urge care on data custody

The legislature’s fraud and corporations working group presented a menu of approaches to reduce fraudulent entity filings tied to commercial registered agents. Secretary of State staff and outside advisors outlined measures ranging from targeted statutory clarifications (administrative dissolution for repeated fraud) to a comprehensive filing‑system upgrade and identity‑proofing requirements.

David Pope and other working‑group members said their recommendations fall into three buckets: (1) requirements on filers (natural‑person execution or proofing), (2) expanded Secretary of State enforcement and administrative‑dissolution powers when fraud is alleged or litigated, and (3) a modernized filing system with additional enforcement staffing. "The secretary of state's office should at least have a staff of 5 people for enforcement," Pope said while outlining estimated system upgrade costs.

Commercial registered‑agent providers cautioned against requiring agents to collect and store sensitive beneficial‑ownership information because data custody and cybersecurity obligations would substantially increase vendor liabilities and risks. "We are not equipped to hold that information safely," Lucinda Wood, general counsel for a corporate filing service, testified. Working‑group technical advisers proposed a custody model that encrypts identifying data and allows controlled disclosure to authorized authorities under court process rather than wide civil discovery.