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• 09/28/2007

CSLB Press Release - 09/28/2007

Contractors State License Board Issues its Results of West Sacramento Undercover Sting Operation

First multi-industry operation leads to arrests, citations and fines

WEST SACRAMENTO — The following are results from an undercover sting operation conducted by the Contractors State License Board (CSLB’s) Statewide Investigative Fraud Team (SWIFT). This was part of a multi-industry enforcement operation conducted by three Department of Consumer Affairs (DCA) regulatory programs. They were the CSLB, Bureau of Security and Investigative Services (BSIS) and Bureau of Electronic and Appliance Repair (BEAR).

Other partners in the operation were the Yolo Unlicensed Response Apprehension Team (YOU RAT), consisting of West Sacramento Police Department, West Sacramento Code Enforcement and the Yolo County District Attorney’s Office. The Department of Insurance and Department of Industrial Relations’ Division of Labor Standards Enforcement (DLSE) also participated. Industries targeted in the operation were construction, locksmith, and computer and appliance repair.

Members of SWIFT posed as homeowners during the two-day operation at a West Sacramento home and invited suspected illegal operators to bid on projects that included: fencing, painting, tree trimming, concrete and locksmith. When they bid over $500 on a job, they were arrested and cited. California law requires a state contractor’s license for home improvement jobs that are valued at more than $500 in supplies and labor. A total of 15 people were arrested and received Notices to Appear (NTA) in Yolo County Superior Court to answer misdemeanor charges of contracting without a license. Some of those will also face charges of illegal advertising; their court date is November 7, 2007.

In addition, a DLSE investigator issued citations to three individuals for minimum wage, cash pay or workers’ compensation violations. The fines associated with those citations totaled $50,900.

The sting also highlighted the importance of bringing various agencies together in partnerships. In one instance, a man who showed up to give a bid for appliance repair work (BEAR jurisdiction) had a business card that stated he also did heating and air conditioning work (CSLB) jurisdiction. He also had a worker who was being paid in cash and wasn’t covered by workers’ compensation insurance (DLSE jurisdiction). The man received a "Contact Report" from BEAR, a citation and $700 fine from CSLB for "Contracting without a License", and $48,500 in fines from DLSE.

"Homeowners may think they are saving money by hiring someone who is unlicensed," said CSLB Registrar Steve Sands. "But, you never know what kind of individuals you are inviting into your home and what their real motives are. You also don’t know if they can even do the job."

Unlicensed operators are part of a multi-billion dollar underground economy that takes jobs away from legitimate contractors, and tax dollars from schools, roads and law enforcement. Illegal operators rarely have workers’ compensation or liability insurance. Homeowners have little recourse if something goes wrong with an unlicensed operator.

"Unlicensed professionals compete unfairly against properly licensed businesses and professionals, most of whom do a good job of providing services to benefit consumers," said DCA Director Carrie Lopez. "The best way to stop unlicensed activity in California is for consumers to stop hiring them."

The CSLB urges consumers to follow these tips as well:

• Hire only licensed contractors and ask to see the license;
• Don't rush into decisions and don't hire the first contractor who comes along;
• Be especially hesitant when approached by someone offering home improvement services door-to-door, especially when they will use material they claim is left over from another job;
• Verify the contractor's license at www.cslb.ca.gov or via CSLB's automated phone service at 1-800-321-CSLB(2752);
• Don't pay more than 10% down or $1,000, whichever is less;
• Don't pay cash, and don't let the payments get ahead of the work;
• Get three bids, check references and a written contract; and
• Contact the CSLB if you have a complaint against a contractor.

The Contractors State License Board operates under the umbrella of the California Department of Consumer Affairs. The CSLB licenses and regulates California's 312,000 contractors, and investigates more than 21,000 complaints against contractors annually. In fiscal year 2006-07, the CSLB helped consumers get almost $45 million in restitution.