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India IT company scam

billkang77
Active Member
Bill K Member Since: Dec 21, 2018
1 of 10

Hello,

 

I think another scam has contacted me. I recieved an invitation. The proposer is seeking a US citizen to help an Indian IT company set up their US presence. They need a US citizen to help them establish an EIN number with the IRS and help setup bank accounts. Sounds like a scam. Has anyone had experience with this?

mtngigi
Community Guru
Virginia F Member Since: Feb 15, 2016
2 of 10

Bill K wrote:

Hello,

 

I think another scam has contacted me. I recieved an invitation. The proposer is seeking a US citizen to help an Indian IT company set up their US presence. They need a US citizen to help them establish an EIN number with the IRS and help setup bank accounts. Sounds like a scam. Has anyone had experience with this?


You should report this immediately to Upwork. I'll flag your post to get a mod's attention.

gilbert-phyllis
Community Guru
Phyllis G Member Since: Sep 8, 2016
3 of 10

Threadjack alert...

 

Virginia, how do you flag a post to get a Mod's attention?

mtngigi
Community Guru
Virginia F Member Since: Feb 15, 2016
4 of 10

Phyllis G wrote:

Threadjack alert...

 

Virginia, how do you flag a post to get a Mod's attention?

 

 

You click on the three little dots in the upper right-hand corner of the OP's post - and then choose "report inappropriate content" at the bottom (there are other options there as well).


 

tinker_bell3
Moderator
Joanne Marie P Moderator Member Since: Nov 26, 2017
5 of 10

Hi Bill,

 

Thanks for bringing this to our attention. I've shared this with team for investigation. You can also report this to us by flagging the job and it will automatically send us a notification allowing our team to review and take appropriate actions. You may also want to check Tips to avoid questionable jobs.

~ Joanne
Upwork
2591126f
Community Guru
Vivek K Member Since: May 28, 2016
6 of 10

Although I may be wrong. I feel it may not be a Scam.

Many new entrepreneurs get attracted to the idea of opening a Foreign Company.This may be based on what a consultant (obviously a sales Person with intention of selling his service) told them or whatever they read on some of those website.
Apart from other  heavy word they throw like   large market, lower tax, low compliance, greater credibility to US consumer and to those overseas,One of the benefits that such consultants point out is 'increased chances of investment'. It is pointed out for example- A US based Angel/ VC may be interested in investing in a US company only. This gets validated by pointing out the cases of some sucessful enterprise that relocated on investment. 

It is perfectly legal for someone to open a US company and their is nothing sinister about it. For Example Some people may be serving US market and thus need a presence there
What many new entrepreneurs fail to understand is that while some of the investors may like to have the company in their preferred jurisdiction, they would not invest in just any company in that jurisdiction. The underlying business must justify the investment. Rest details can be sorted when needed.Restructuring/Relocation can happen when their is a reason or logic behind it. Last night dream of 1 billion investment is not a valid reason.
Any one who is desirous of opening a business/relocating their old business in a new country would need to do careful planning. If their no specific need then by opening a US company they are doing nothing but incurring unnecessary cost and headache of various compliances.

But Being Naive is not same as Being Scammer.


In OP's case it seems the client wants to open a US company but since they cannot open a bank account in US without physical presence (for which they do not want to undertake a trip), they have decided to to that by appointing a manager (whatever designation) or some sort of combination of Registered Agent and Manager.
I am sure they do not understand the implications of giving a stranger complete Access to their company bank account.

 

This is not to say Freelancers may not be exposing themselves to any obligations by taking this Job. They certainly need to be cautious and should not get into something they do not understand completely.

This may even be some sort of scam trying to social engineer freelancers to part with some docs and may be money.
But it does not look like one (atleast to me)from the details OP has posted.

browersr
Community Guru
Scott B Member Since: Nov 20, 2015
7 of 10

While I think Vivek is correct about legitimate needs for an EIN and bank account in the US, the reality is there is no reason to seek a freelancer for such services. 

 

People outside the US can obtain an EIN by calling the IRS. You cannot apply on-line but you can via phone. If looking for a US bank, one should be aware that many banks in the US are also located in other countries and they could help by going to them directly. Otherwise non-US folks can look to something like TransferWise which provides a "borderless" account. This includes US account and routing numbers (for other countries as well). 

 

A larger company I could certainly see obtaining the services of a US based business lawyer for assistance. However, at best it's misguided to use a freelancer (unless of course they are a freelance lawyer) and at worst they are a scam. For the most part I would make the assumption that it is a scam as MANY are known to be and they use sites just like this. Unless you actually are a lawyer, I wouldn't take the chance.

2591126f
Community Guru
Vivek K Member Since: May 28, 2016
8 of 10

 

Scott

 

Not to argue but Just wanted to point something which would not be very obvious to many people.

 

"In India a company cannot be registered without an accompnying  certification of 'CA/CS /CWA in full time practice.' CA are the Chartered Accountants, CS is the Company Secretary and  CWA refers to Cost and Work accountant. They are members of respective Professional Bodies ICAI, ICSI AND ICWAI.  

Even apart from the technical issue of certification,these professionals are go to person for all legal/ Tax issues for companies.

In practice,They are the ones (Mostly CA/ CS but sometimes CWA as well) that ususlly handle complete process of registration and subsequent compliances right from scratch.

The clients in question  may be drawing inference from that experience and inviting OP who seems to have mentioned being a cost accountant (they may have assumed they have same role as CWA in India), without realizing that the process may be different from that In India."

 

That said I completely agree to what you have said.

The client is definitely not a big corporation . Big corporations do not ask random strangers to act on their behalf.  Even much smaller Companies like mine would first  take services fo a lawyer, if we needed to plan a business in foreign jurisdiction.  

 

Company Formation is a serious issue but there are people who take it very lighly.

 

This particular client may be misguided (which I believe is the case) or may be a scammer .

There is no reason a freelancer should get into this or any other Job without fully understanding what the Job requires of them and if they are OK with it.

 

 

petra_r
Community Guru
Petra R Member Since: Aug 3, 2011
9 of 10

Vivek, the only reason the OP was contacted was to help some Indian freelancer / agency be able to operate as a US based entity and hence have access to US-only jobs.

 

 

2591126f
Community Guru
Vivek K Member Since: May 28, 2016
10 of 10
Petra
I feel you may be right. Definitely many freelancer have complained of being contacted by scammers for providing access to their upwork account. May be this is a version2.0 of same scam.
I do not however fully understand the modus operandi .
Are they trying to trick OP into helping them set up a US company and bank account by providing his address and other details which they will use for registration on upwork and falsify their physical location by VPN
or this whole EIN/Bank account is just a hogwash and the scammers would just ask for OP's account access down the line.
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