Beware. Some Contractors Thrive on Scams: Tip-offs to a rip-off

A 'drive-by' contractor offers you a deal. He's in a hurry, but you shouldn't be.
By: John Morell: Los Angeles Times
GARY KIERNAN says he wasn't asking for anything fancy. The kitchen of his Culver City condo needed remodeling — new cabinets, a floor and some plastering work on the ceilings and walls.

Last summer, when an acquaintance told the 75-year-old retired Pan Am employee about a contractor who could do the job for a reasonable price, Kiernan was happy to get started. "The condo was built in the early 1970s and the cabinets and flooring were falling apart," he said.

After being paid $2,500, the contractor hastily plastered parts of the ceiling, disconnected a radiant heating system, removed one wall but failed to finish the new one and never touched the deteriorating floor. And then he left. After repeated calls, the contractor told Kiernan he'd finish the job after he was done with a big construction project, but he never returned.

His remodeling funds depleted, Kiernan has tried to do what he can himself.

"I sand the plaster a little at a time each day, but I can't get too much done," he said. "I wish I'd never started this. It's been a nightmare."

Such stories are common in the home-improvement industry, experts say. Although Southern California is home to many skilled and honest contractors and tradespeople, there are some who thrive by being dishonest and others who are simply incompetent.

"For almost as long as there have been homes, there have been bad or crooked contractors," said Pamela Mares, a spokeswoman for the California Contractors State License Board. State law requires anyone hired to do a home building or repair project with a value of more than $500 to have a contractor's license.

The board receives an annual average of 20,000 consumer complaints about contractors. Last year, the board suspended, cited or revoked the licenses of 1,672 contractors. It also gave citations to 1,774 contractors operating without a license and referred more than 1,300 of those cases to local prosecutors.

Victims can be found in all communities and own homes in all price ranges. And although having money doesn't exempt someone from being cheated by a contractor or scam artist, the elderly and immigrants tend to be frequent targets, consumer watchdogs say.

"These crooked contractors try to find people who will trust them and give them fast cash without a lot of questions," said Gary Almond of the Better Business Bureau of the Southland. "They thrive on the uninformed consumer."

"There are many horror stories," said Armando Abrego, a manager with the Culver City Senior Center. "Even my own mother got ripped off, spending $500 for a guy to spread some worthless paint on her driveway.

"We try to help our seniors the best we can," he said, "making calls for them, checking on licenses."

Bad contractors fall into two camps, according to Mares: those who may have some knowledge of their craft but for whatever reason are trying to fly under the radar and earn a living without getting a license, and those who just want to rip off people. "In either situation," Mares said, "the consumer is getting a bad deal."

Although he doesn't consider himself uninformed, Kiernan neglected to check the contractor's license status and felt that, because the contractor had been recommended by an acquaintance, he already had a reference. It turned out that the license had been expired for years.

And Kiernan trusted him enough not to require a written contract, which would have made it easier to sue for doing inferior and incomplete work. Calls to the contractor for this story were not returned. Kiernan did not report the contractor.

Many people don't know where to turn when something like this happens.

In addition to incompetent contractors, there are those who use the pretense of a legitimate business to steal.

"The technical term for them is 'transient criminals,' and they have honed their skills at ripping people off," Mares said. Also known as "travelers," these groups target homeowners, churches and small businesses with handyman and contracting schemes.

"The asphalt scam they pull has always been around, and it will never go away," said Roger Hays, a fraud investigator with the state contractors board. "It's very profitable."

Basically, the scam artists roll up to a home or establishment with an asphalt driveway that's in marginal condition and offer to resurface it for a great price. "They'll tell you they just finished a project a few streets over and have extra asphalt, so they'll resurface your driveway," Hays said.

Although the finished job looks nice, it doesn't last.

"They'll spread out a thin coat, just half an inch thick instead of 2 inches, which is standard," he said. "Or they'll simply spray it with used motor oil to make it look newer."

The West Valley Christian Center in Chatsworth was nearly victimized last year by a group that showed up and offered to repave the church parking lot. The Rev. Kenneth Walters thought the price, $6,000, sounded good and asked for the contractor's license number so he could check it.

"We looked him up online and he was a licensed paving contractor in good standing, so we assumed he was OK," Walters said.

Before the work was complete, however, the state board received a tip that a paving-scam ring was working in the area. Police and investigators moved in quickly and made several arrests, including the ringleader, who had made the deal with the church, for allegedly contracting without a license. "We felt we had done our due diligence checking on his license, but we still nearly got burned," Walters said. "In our case, the contractor was using the license of a relative who had the same name."

Homeowners also should be wary of roofers who press a wet sponge to an eave during the rainy season, to make it appear that water is getting past the shingles, and tell you about the repairs you need. Investigators also warn of another scam: painters who are "just finishing a job up the street and want to keep their crews working."

Such come-ons are sometimes a front for burglars.

"A couple of them will show up at your house offering some kind of deal, and while one walks around the outside of your house with you, the other sneaks in and grabs whatever valuables he can find," Hays said.

A variation is the "collateral" trick. "A guy shows up at your door with a good price to do some work on your house and says first he needs a few hundred dollars for supplies that he'll go get in his truck," he said. "To ensure his return, he jokingly tells you he'll leave his kids with you, and one or two children will sit on your step waiting for their father to return."

After a little while, though, the kids wander off, eventually meeting up with the adult down the block, never to return.

Catching such scam artists isn't easy.

"They move around frequently and quickly," Mares said, "and they work fast."

If they're caught in a sting, "you can charge them with felony grand theft," Hays said. "But these crimes aren't usually high on a prosecutor's list. They often end up paying a fine, then changing their name and moving. It's a very lucrative business."

The first line of defense is to check a contractor's license through the state board either online at http://www.cslb.ca.gov or by phone, (800) 321-2752. However, as Walters found out, that's not always foolproof.

One common trait among contractor scam artists is that they add a time element to the job. They're between projects and can do yours right away for an incredible price, but if you want to wait until the next day or ask to check up on their references, they won't have time. According to Mares, "Unless it's an emergency project like a plumbing problem or a hole in the roof, waiting to check on their references is never a bad choice."

Travelers often use new trucks and equipment, Hays added, so don't be taken in by appearances. Check for out-of-state license plates. "They drive where the business is," Mares said, "showing up in Southern California around the spring and then moving around from there."

If you suspect you've been scammed or are suspicious of the contractor at your job site, the board suggests either calling the police or the board's Statewide Investigative Fraud Team (SWIFT) at (800) 321-2752 to check it out. "SWIFT teams are able to move in quickly and investigate a situation to see if there's been a violation," Hays said.

And to guard against incompetent contractors and help educate the public, new state guidelines went into effect Jan. 1 that call for clearly written and understandable contracts for home improvement contractors.

Overall, it pays to be vigilant when dealing with an unfamiliar contractor or handyman. But even then, that may not be enough.

"You could say we were lucky not to have paid out a lot of money for a bad job," Walters said. "I also like to think it was a divine intervention."