More than Two Dozen Arrested in Contractors State License Board Undercover Sting Operation in Los Angeles
Illegal operators are threat to homeowners and legitimate licensed businesses
LOS ANGELES — There were no Halloween treats for the phony contractors who showed up at the door of a sting house in the Atwater Village area of Los Angeles looking for easy money. Instead, they ended up being arrested and now face charges of contracting without a license. The Contractors State License Board (CSLB) arrested a total of 27 people in a two-day undercover sting operation that ended Thursday.
Members of CSLB's Statewide Investigative Fraud Team (SWIFT) posed as homeowners at the sting house and invited suspected unlicensed operators to bid on a number of home improvement projects, including landscaping, painting, flooring, fencing, new windows, new doors and a bathroom remodel. When the suspects bid more than $500 for a job, they were arrested and given a Notice to Appear (NTA) in Los Angeles County Superior Court to answer misdemeanor charges of contracting without a license. In some cases, suspects will also face a charge of illegal advertising or not being registered as a Home Improvement Salesperson.
California law requires that anyone who performs home improvement jobs, valued at $500 or more in labor and materials, to have a CSLB license. There are more than 316,000 licensed contractors in California in 43 different classifications.
Sting targets were identified from consumer complaints, online and print advertisements and tips from the Plumbing-Heating-Cooling Contractors association, whose members face unfair competition from these individuals who work without bonds, workers' compensation insurance, and who don't pay taxes or other legally-required business expenses.
"Many homeowners don't realize the risk they take when they hire an unlicensed operator," said CSLB Registrar Steve Sands. "They think they're going to get a good deal, but usually end up paying twice for a job when they have to hire a professional to fix the problems the unlicensed operator left behind."
The sting also showed that contracting without a license isn't the only legal problem some suspects have. Several of the targets who showed up at this week's sting were driving without a valid driver's license. So, after being released, they had to walk from the sting site and arrange to have someone pick up their vehicle. One of those arrested was a parolee whose only identification was an I.D. card from the California Department of Corrections. Before getting a CSLB license, all new contractors must first pass a criminal background check.
Homeowners seldom realize other risks they take when hiring illegal operators. These phony contractors rarely, if ever, have workers' compensation or liability insurance. If a worker gets hurt on the job, they could come after the homeowner to pay their medical expenses. In addition, homeowners have little recourse when something goes wrong with the job. "Some unlicensed operators deliberately target trusting and vulnerable people," added Registrar Sands. "They can take your money and be gone before you realize what has happened."
The cases against those arrested will now be turned over to Los Angeles City Attorney Rocky Delgadillo's Office, which has partnered with CSLB to streamline prosecution of unlicensed contracting cases within the City of Los Angeles. Since the partnership was created in December 2005, 148 cases have been filed, with 83 convictions and more than $1.2 million in restitution ordered for victims. Sixty-five cases are currently pending.
The CSLB urges consumers to follow these tips when hiring a contractor:
- Be especially hesitant when approached by someone offering home improvement services door-to-door.
- Verify the contractor's license by checking online at www.cslb.ca.gov, or via CSLB's automated phone service at 1-800-321-CSLB (2752).
- Make sure all workers are covered by workers' compensation insurance.
- Don't pay more than 10% down or $1,000, whichever is less.
- Don't pay in cash, and don't let the payments get ahead of the work.
- Check references; get three bids and a written contract.
- 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 316,000 contractors, and investigates more than 20,000 complaints against contractors annually. In fiscal year 2007-08, the CSLB helped consumers get $35.2 million in ordered restitution.
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