Blog

Wyoming attempts to plug a shell company loophole

Posted by Clyde Hutchins | Jan 18, 2017 | 0 Comments

Wyoming attempts to plug a shell company loophole

The Wyoming legislature is in session for the next few weeks. One of the pending bills aims to plug a loophole that allows people to own or control Wyoming corporations and companies anonymously. As I have wrote about in the past, as the law is currently written, someone can setup a Wyoming business entity through a registered agent and hide the true owner of the entity from both the public and State government. This unique privacy function has contributed to Wyoming being known as a haven for corporate secrecy.

I think that this bill was enacted in response to last year's scandal involving the Panama Papers and Mossack Fonseca embarrassed the State of Wyoming and gave new energy to efforts by the State to rein in the loose regulation which sometimes allows Wyoming entities to be used for fraud. In furtherance of that effort, the pending bill seeks to change who qualifies as a communications contact for Wyoming companies and corporations. Existing law allows most anyone to be listed as a communications contact, including the registered agent. The pending bill would change that to require that the communications contact be someone legitimately connected to the entity, such as a director, office, member, manager, managing partner, trustee or employee. This will not remove all the problems with secrecy in Wyoming, but it would remove one layer of the deep anonymity allowed for Wyoming entity owners.

We will be watching the Wyoming legislative session to see how this bill progresses.

 UPDATE: HB 22 was passed as Enrolled Act 105 and became law, effective July 1, 2017.

About the Author

Clyde Hutchins

Clyde Hutchins is the founder of Harmony Law. Mr. Hutchins started his career as a lawyer in Cheyenne, Wyoming. First gaining experience as a law clerk for the district court judges, Mr. Hutchins entered private practice with a Cheyenne firm focused on civil litigation, business law and some general practice law. Later, Mr. Hutchins went to Alaska, where he was the chief litigator for a firm that engaged in bond law, corporate law, securities law, and the broad reach of municipal law. Mr. Hutchins returned to Cheyenne to represent the State of Wyoming in the national tobacco arbitration. While in that position, he developed the consumer protection unit for the Wyoming Attorney General's Office. He led over 120 investigations and enforcement actions in Wyoming and worked on numerous joint cases with the Federal Trade Commission and other states, including Colorado. Mr. Hutchins relocated to Colorado in 2016 and founded Harmony Law. Mr. Hutchins has established Harmony Law in three principal areas of law. First, it is a general practice firm in the areas of business law, estate planning and family law. Secondly, it is a civil litigation firm, practicing law in state and federal courts throughout Wyoming and Colorado. Finally, it is one of the few firms in Wyoming or Colorado that focuses on consumer protection law.

Comments

There are no comments for this post. Be the first and Add your Comment below.

Leave a Comment

Comments have been disabled.

Member of the National Association of Consumer Advocates

Naca badge medium blue grey 0

Harmony Law is one of the few law firms in Colorado and Wyoming that focuses on consumer law. Mr. Hutchins is a member of the National Association of Consumer Advocates and state chair for Wyoming. If you have a consumer law issue, please feel free to call 970-488-1857 and speak with Mr. Hutchins.

Explore your Options

It is difficult to make important decisions without knowing all your options. Explore your options with Harmony Law and you will be better equipped to make the right decision in your legal affairs.

Menu