Secretary of the State Susan Bysiewicz and Attorney General Richard Blumenthal have started initiatives to crack down on out-of-state companies doing business illegally in Connecticut.
“In these tough economic times, it”™s important for businesses in Connecticut to have a level playing field,” said Bysiewicz.
The joint effort between the two officials recovered $1,035,873.60 in fiscal year 2008 in fines from 310 out-of-state companies that failed to register with the state before doing business in Connecticut.
“Any company that does business in our state must abide by the law, file the proper papers with my office, and list a qualified agent,” said Bysiewicz. “This ensures accountability for consumers and we will continue to pursue and seek restitution from those who violate the law.”
Bysiewicz and Blumenthal were also joined by Howard Schwartz, the Communications Director of the Connecticut Better Business Bureau, representing businesses, particularly contractors affected by the illegal practices.
“Under state law, corporations, limited liability partnerships, nonstock corporations, stock corporations, and statutory trusts doing business in Connecticut are required to register with the Secretary of the State”™s Office and pay the statutorily established fee before they can transact business here,” said Blumenthal in a written statement. “There are approximately 47,416 of these foreign entities which have filed with the Secretary of the State”™s Office.”
According to the pair, the requirement to obtain authority to do business exists to protect domestic organizations from unfair competition and place domestic and foreign organizations on an equal footing. The law also protects consumers with a grievance against an out-of-state business, by specifying where and in what manner the company can be served with legal papers.
Bysiewicz and Blumenthal launched their enforcement efforts last year, aggressively pursuing hundreds of delinquent out-of-state businesses and threatening legal action.
Fines and penalties collected from each business range from $165 to more than $20,000. The average fine for the 2008 fiscal year was $3,341.53, which represented a 22 percent increase from 2007.Â
The three largest settlements came from Florists’ Transworld Delivery for $22,380; Kemira Chemicals Inc.          for $17,805; and T & M Equipment Corp. for $16,913.
According to Bysiewicz and Blumenthal, their enforcement effort will continue to ensure that out-of-state businesses are held accountable.
 “This investigation is helpful for both Connecticut consumers and businesses,” said Paulette Hotton, president of the Connecticut Better Business Bureau. “Connecticut contractors are forced to compete with unlicensed companies that cross state borders, and often undercut local businesses by performing sub-standard work.”
