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How to Vet a Business

Wednesday, August 21, 2019

60% of Sacramento’s Placement Agencies are operating illegally and/or violating Internal Revenue Service (IRS) laws and regulations.  How? First and foremost: By operating without a required and standard business license. This is ILLEGAL!! 

Assisted Living communities are regulated by multiple state agencies, but Placement Agencies have no governmental regulatory body.  This means Placement Agencies can do whatever they want. How do you eliminate potential companies operating illegally?

It starts with a simple vetting process. Properly vetting a business benefits both the customer, and anyone doing business with or referring business to the company in question.  Without proper vetting, seniors are at risk for abuse, human trafficking, improper placement, mistreatment, and poor care. 

Below, we will outline how to determine if the Placement Agency in question has a business license.  Without a business license, your loved one is at risk for physical, emotional, medical and financial abuse. 

What You Need:

Before you start to vet, gather the following info:

  • Company Name
  • Name of Owner
  • Address Company operates from
  • Phone Number

The Process:

There are 3 business license levels.  Since Placement Agencies are unregulated, the minimum business license legally required is a city business license. A county business license will suffice if the company is located in an unincorporated part of the county.

Step 1: Determine whether the company is in an incorporated or unincorporated area of Sacramento County by the address provided. 

Step 2: Locate the proper city or county from the list below. Click the link or call the Business Licensing Department to inquire if the company has a license, if it is active/ inactive, if it was suspended, or if it has never existed.  A city or county business license is MANDATORY to operate a business.

City of Citrus Heights: https://bit.ly/2Pd0jKJ

City of Roseville: https://bit.ly/2ZimEKS

City of Elk Grove: https://bit.ly/2ZlyuQa

City of Sacramento: https://bit.ly/33PpmHa

City of Galt Finance Department Business License Division:  209-366-7150

City of Folsom Business License Division: 866-240-3665

City of Rancho Cordova: (916) 851-8737 | businesslicense@cityofranchocordova.org

Sacramento County Finance Department—Business Licenses: 916-874-6644

California Secretary of State Business Search: https://businesssearch.sos.ca.gov/?Filing=False

If the business you are looking to report is not in these areas, go onto the county’s website and search under the Business section to locate a business search tool.  If unavailable, call the Finance Department and ask them to look up the business.

Step 3: Check with the Secretary of State website to see if the company has done their due diligence and also obtained a State Business License.  If they have, it is a general indicator that they have mitigated your risk and completed proper paperwork.  Note that currently, the State business license is not required.

Step 4: Independent Contractors.  If the company pays its staff as 1099 Independent Contractors, then every single independent contractor is required by law to have their own business license and home address on file for IRS purposes.  Vet the individual placement agents to know whether they are operating in compliance.

Step 5: Ask Questions.  Continue your vetting process by asking:

  • How long have you been operating?
  • Are your staff Employees or Independent Contractors?
  • How do you get paid?
  • Do you have insurance?
  • Review their Better Business Bureau ratings
  • Ask for, and check company references.  These can be other professionals and past clients.

Illegal businesses are the most likely to use shady and unethical business practices, which open many seniors to elder abuse.  As case managers and other healthcare professionals, it is our duty and responsibility to not perpetuate elder mistreatment or illegal business practices.  Before you refer a patient or client, VET the company!

Keep following A Senior Connection’s “Business Ethics Week” on Facebook and LinkedIn.  Tomorrow we will go into detail on the differences between an Independent Contractor and an Employee.

Leading the Way, the Right Way™


 

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