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• 12/05/2006

CSLB Press Release - 12/05/2006

Illegal Operators Get Wrapped Up in San Diego County Undercover Sting Operation

Contractors State License Board targets phony contractors

SACRAMENTO — Homeowners who're getting their property fixed up for the winter are easy targets for unlicensed phony contractors. The Contractors State License Board (CSLB) takes a proactive approach in educating both contractors and the public about the consequences by conducting undercover sting operations. The CSLB's latest was a two-day operation (November 29 & 30) in Northern San Diego County with support from the San Diego County Sheriff's Department and the San Diego Police Department.

CSLB's Statewide Investigative Fraud Team (SWIFT) members posed as homeowners and invited suspected unlicensed operators to locations in Encinitas and Del Mar to bid on various home improvement jobs ranging from tile to landscape, concrete, paint, drywall, and framing. The individuals targeted included those who advertise illegally in newspapers on the Internet and flyers. When their bids exceeded the legal limit of $500 (labor & materials) and they acted illegally "in the capacity as a contractor" they were arrested.

The phony contractors (13 Encinitas and 5 Del Mar) were given a Notice to Appear (NTA) before a San Diego County Superior Court judge January 24 to face misdemeanor charges. The NTA carries a maximum six months in jail and/or up to $1,000 fine for a first-time conviction. One man was arrested and booked for fraudulent use of a contractors license (7027.3 B&P). William Pitre was also wanted on outstanding warrants and faces charges for residential burglary (459 P.C.), residential robbery (211 P.C.) and grand theft (487 P.C.).

The CSLB teams with local law enforcement to conduct stings on an almost weekly basis all around the state. Not only are homeowners put at risk when they hire these phony contractors, the state's 304,000 licensed contractors have to compete against the lawbreakers, who underbid them on jobs. The unlicensed operators rarely pay payroll taxes, carry workers' compensation insurance on their employees and other costs that legitimate contractors pay. They are part of a $60 to $140 billion dollar underground economy that takes money away from roads, schools and law enforcement.

"The CSLB and our community partners are serious about going after people who break the law." said CSLB Registrar Steve Sands. "Homeowners face a high financial risk if something goes wrong with an unlicensed operator and legitimate business people have a hard time competing against people who are cheating."

The CSLB urges homeowners to be careful before inviting any contractor into their house or agreeing to have any work done. Ask to see their state contractor's license and go online or call CSLB's automated phone system to verify that the license is valid. They can also check out the contractor's license history and get bond and personnel information.

The CSLB urges consumers to follow these tips when dealing with a building contractor:

• 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 by checking online or via CSLB's automated phone service at 1-800-321-CSLB (2752)
• Never 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; and
• Get three bids, check references, and a written contract

The Contractors State License Board operates under the umbrella of the California Department of Consumer Affairs. The CSLB licenses and regulates California's 304,000 contractors, and investigates more than 20,000 complaints against contractors annually. In fiscal year 2005-06, the CSLB helped consumers get more than $36 million in restitution.