§ 1108 — Violations and Penalties

* § 1108. Violations and Penalties. (a) (1) A reporting company which\nhas failed to file its beneficial ownership disclosure, attestation of\nexemption, or annual statement as required by this article for a period\nexceeding thirty days shall be shown to be past due on the records of\nthe department of state.\n (2) The attorney general may assess a fine of up to five hundred\ndollars for each day the company has been past due.\n (3) In addition to any action brought seeking relief under paragraph\ntwo of this subdivision, such past due status shall be removed from the\nrecords of the department of state upon the filing of the current\nstatement required by section 1107 of this article, the payment of a\nfine of two hundred fifty dollars, and verification from the attorney\ngeneral that any penalties imposed pursuant to paragraph two of this\nsubdivision have been paid.\n (b) (1) A reporting company which has failed to file its beneficial\nownership disclosure, attestation of exemption, or annual statement as\nrequired by this section for a period exceeding two years shall be shown\nto be delinquent on the records of the department of state.\n (2) The attorney general may assess a fine of up to five hundred\ndollars for each day the company has been delinquent.\n (3) In addition to any action brought seeking relief under paragraph\ntwo of this subdivision, such delinquency shall be removed from the\nrecords of the department of state upon the filing of the current\nstatement required by section 1107 of this article, the payment of a\nfine of two hundred fifty dollars, and verification from the attorney\ngeneral that any penalties imposed pursuant to paragraph two of this\nsubdivision have been paid.\n (c) It shall be unlawful for any person to knowingly provide, or\nattempt to provide, false or fraudulent beneficial ownership\ninformation, including a false or fraudulent identifying photograph or\ndocument, to the department of state in accordance with this article. A\nperson shall not be in violation of this subdivision if such person\nvoluntarily and promptly, and in no case later than ninety days after\nthe date after the submission of beneficial ownership information,\nprovides the corrected information in the form and manner prescribed by\nthe department of state, unless the false or fraudulent information was\nwillfully submitted for the purpose of evading the requirements of this\narticle.\n (d) In addition to any existing authority, the New York state attorney\ngeneral may investigate any violation of subdivision (c) of this section\nand any limited liability company that fails to file its beneficial\nownership disclosure, annual statements, or attestation of exemption as\nrequired by section eleven hundred seven of this article. The department\nof state may refer, for an investigation, to the attorney general any\nlimited liability company for any violation of the provisions of this\narticle. The New York state attorney general may seek a fine of up to\nfive hundred dollars for each day the company has been past due in\nfiling its beneficial ownership disclosure or attestation of exemption.\n (e) (1) The New York state attorney general may bring an action under\nthis section to dissolve or cancel any entity that is delinquent in\nfiling it's beneficial ownership disclosure or attestation of exemption\nor has violated provisions of subdivision (c) of this section. If in the\ncourt's discretion it shall appear that the limited liability company\nshould be dissolved and cancelled or the foreign limited liability\ncompany's authority to do business in this state should be annulled, it\nshall make a judgment or final order dissolving the limited liability\ncompany or annulling the authority of the foreign limited liability\ncompany.\n (2) If the judgment or final order shall provide for a dissolution and\ncancellation of the limited liability company or the annulment of\nauthority of the foreign limited liability company, the court may, in\nits discretion, provide therein for the distribution of the property of\nthe limited liability company to those entitled thereto according to\ntheir respective rights.\n (3) The clerk of the court or such other person as the court may\ndirect shall transmit certified copies of the judgment or final order of\ndissolution to the department of state.\n (4) Upon filing by the department of state, the limited liability\ncompany shall be dissolved and its articles of organization cancelled or\nthe authority of the foreign limited liability company shall be\nannulled.\n (f) Any penalties provided for in this section shall be in addition to\nand may be imposed concurrently with any other remedy or penalty\notherwise provided for in law.\n (g) Any reporting or exempt company that fails to file its beneficial\nownership disclosure or attestation of exemption in accordance with\nsection 1107 of this article shall be deemed suspended. Any reporting or\nexempt company that fails to file its beneficial ownership disclosure or\nattestation of exemption in accordance with section 1107 of this article\nshall be given notice by the department of state of such suspension, at\nleast thirty days prior to any change of status. A reporting company or\nexempt company that is suspended by operation of this subdivision shall\nnot conduct business in New York state until its beneficial ownership\ndisclosure or attestation of exemption has been filed, at which point\nthe suspension shall be deemed annulled and all corporate powers,\nrights, privileges, immunities, duties and liabilities shall be restored\nretroactively. The suspension of a reporting or exempt company shall not\nlimit or impair the validity of any contract or act of such reporting or\nexempt company, or any right or remedy of any other party under or by\nvirtue of any contract, act or omission of such reporting or exempt\ncompany, or the right of any other party to maintain any action or\nspecial proceeding on any such contract, act or omission, or right of\nsuch reporting or exempt company to defend any action or special\nproceeding in this state, or result in any member, manager or agent of\nsuch reporting or exempt company becoming liable for the contractual\nobligations or other liabilities of the limited liability company.\n (h) The secretary of state may promulgate regulations necessary to\neffectuate the provisions of this article.\n * NB Effective January 1, 2026\n