CSLB Sweeps Up Four Suspected Workers' Comp Insurance Violators in "49 Fire" Burn Area
Investigators team with local prosecutors to crack down on the unlicensed and uninsured
SACRAMENTO —Investigators from the Contractors State License Board's Statewide Investigative Fraud Team (SWIFT) conducted a construction sweep and a sting operation on Wednesday, November 18, 2009, in Auburn's 49 Fire region. This is SWIFT's second enforcement activity for the 49 Fire, which was declared a state disaster area on August 31, 2009.
CSLB routinely conducts sweeps and stings after natural disasters to ensure that victims are not defrauded by unlicensed and uninsured contractors. This time, SWIFT investigators partnered with teams from the Placer and Amador County District Attorney's offices for the operation.
During the sweep, four contractors were referred to prosecutors for failure to secure workers' compensation insurance for their employees, as required by the California Labor Code. One person also received an administrative citation from CSLB for failing to provide coverage for an employee. California's Business & Professions Code (B&P) requires CSLB licensees to carry workers' compensation (comp) insurance for all employees, except themselves. Because of the high safety risk, C-39 roofing contractors must carry workers' comp insurance, even if they have no employees.
During the sting, investigators scheduled construction bids from area contractors who advertised in local publications. B&P Code requires contractor license numbers in all advertisements, or that those who are not licensed state that they are "not a licensed contractor." Anyone contracting for work valued at $500 or more for labor and materials must be state-licensed. One Notice to Appear (NTA) in court was issued to a non-licensee who bid for fencing work and an entire roof. Contracting without a license in a federal or state-declared disaster or emergency area can potentially result in felony charges, punishable by up to $10,000 in fines and/or 16 months in prison.
"Clearly, CSLB is proactive in disaster areas," said CSLB Registrar Steve Sands. "The last thing we want is for someone who's suffered losses or damages to have their problems compounded by unscrupulous scam artists."
The NTA issued to the non-licensee will require his appearance at the Placer County Court facility in Roseville on December 22, 2009. The four workers' comp cases referred for prosecution will be turned over to the Amador County District Attorney as part of that office's grant program, which specifically focuses on workers' compensation insurance compliance.
CSLB also took advantage of this operation to educate consumers about the importance of making sure their contractors have licenses and workers' comp insurance, and to let legitimate licensees doing work in the area know they can report suspected unlicensed activity to CSLB.
CSLB's free, online publication After a Disaster, Don't Get Scammed! includes some of the following tips for rebuilding or repairs:
- Don't rush into repairs, no matter how badly they are needed
- Get at least three bids
- Check out all licenses at www.cslb.ca.gov or www.CheckTheLicenseFirst.com
- Be cautious about door-to-door offers for repair services, and flyers or business cards that are left on your doorstep
- Ask friends, family, and associates for recommendations about contractors they have hired
- Don't pay in cash
- Get a written contract that details every aspect of the work plan
- Make sure the contractor has workers' compensation coverage if he is bringing work crews onto your property.
In 2009, CSLB, which operates under the umbrella of the Department of Consumer Affairs, marks its 80th anniversary of protecting consumers by regulating California's construction industry. Today CSLB licenses about 315,000 contractors. In any given year, complaints are filed against only 3% of licensed contractors. In fiscal year 2008-09, CSLB helped consumers recover nearly $36 million in ordered restitution. Learn more about CSLB at www.cslb.ca.gov or www.CheckTheLicenseFirst.com .
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