Nominee Directors, Officers, and Managers
Nominee directors, officers, and managers have been used in Nevada for over 75 years to take advantage of the financial privacy provided by the favorable corporate laws in Nevada. Nevada does not require disclosure of information about company ownership, stock, or capital. Only the director, the president, the treasurer, and the secretary of corporations and managers of LLCs are required to be listed on any public record in Nevada. And, of course, one person can simultaneously fulfill director and officer responsibilities in a Nevada corporation.
However, over the years, government restrictions and fiduciary liability have limited how nominees can be used. Due to IRS restrictions, nominee directors, officers, and managers can no longer obtain Federal Employer Identification Numbers or sign Federal Income Tax Returns. As for banking, the bank will hold the nominee directors, officers, and managers to a fiduciary duty should there be any problems; therefore, nominee directors, officers, and managers can no longer open bank accounts. Finally, legislators severely limited nominee directors, officers, and managers service in the last legislative session by adding the following language to the bottom of every Initial/Annual List:
None of the officers or directors identified in the list of officers has been identified with the fraudulent intent of concealing the identity of any person or persons exercising the power or authority of an officer or director in furtherance of any unlawful conduct.
I declare, to the best of my knowledge under penalty of perjury, that the information contained herein is correct and acknowledge that pursuant to NRS 239.330, it is a category C felony to knowingly offer any false or forged instrument for filing in the Office of the Secretary of State.
Of course, the key phrases are, “fraudulent intent of concealing the identity of any person,” and, “in furtherance of any unlawful conduct.”
Prosecutors take the position that anyone who does not want to be identified is probably involved in “the fraudulent intent of concealing the identity of an officer, director, or manager.” This puts everyone, including the nominee directors, officers, and managers, in the very uncomfortable and expensive position of having to prove their innocence.
Will your business entity be the target of an aggressive prosecutor? I don’t know. The real question, in this day of envy, is: Are you willing to take the risk?
We serve many valued clients that need their companies to be private. They pay their taxes, run their businesses legally, and are upstanding members of society. They desire privacy to prevent their assets from being searched and found. If we determine that a client is abusing the system or trying to hide from the law behind their Nevada company, we will resign as their registered agent.
We do not offer nominee directors, officers, and manager services or shelf companies. If a registered agent providing your business formation services is offering nominee directors, officers, and managers services , what kind of companies will be associated with the address you are about to use? We maintain a “pure” address out of respect for our clients and their business’ reputation and safety.