Arizona to require selfie verification to stop fake LLC filings

The Arizona Corporation Commission will begin requiring online users to submit a photo ID and a selfie when forming a limited liability company. The new verification process is scheduled to go live by July 1, 2027. This measure aims to stop fraudsters from using random residents' names and addresses to create businesses they do not actually own.

Morgan Johnson, a Phoenix resident, discovered the issue after receiving mail about credit accounts she never opened. She found that three separate LLCs had been registered in her name at her home address over the past year. One of these entities was a furniture store, and another was a toy wholesaler. Johnson said the discovery felt intrusive because she had no involvement in either business.

Tanya Gibson, director of the Corporations Division, stated that the current system allows anyone to file an LLC online using only a name and address. No government-issued identification is currently required. Gibson explained that the division has no method to verify if a filer has the right to use a specific address. She described the problem as a huge issue for the agency.

Complaint data from the Arizona Corporation Commission shows the scale of the problem. The division received 208 complaints regarding fake LLCs in September 2025. Although complaints dropped after a new system launched in early 2026, the number rose again to 180 by May 2026. Gibson noted that fraudsters often target clusters of addresses, suggesting they use random lists of names and locations.

The upcoming verification software will run the submitted information against multiple databases. If the data matches, the user receives a verified stamp and can file immediately. If the data does not match, the user must visit an office in person to complete the filing. Gibson said the state cannot prevent all fraud but is adding hurdles to make the process harder for bad actors.

When the state receives a complaint about a fake LLC, it can take months to dissolve the entity. During that time, the division marks the status as pending inactive and not in good standing. They also flag the record as undeliverable to alert banks and credit agencies. Gibson said she wants the law changed to give the division more authority to validate information and deny filings when fraud is suspected.

Johnson said that flagging fake LLCs after they are created is not enough. She urged officials to do more to protect residents. Gibson advised residents to check their own addresses for unauthorized LLCs and file a complaint with the secretary of state's office if they find any.