HAMMOND – Tangipahoa Parish Sheriff Daniel Edwards warns citizens against contractor fraud and offers 10 tips on how to spot fraud.
"Fraudulent contractors are a blight on the contractor industry. Unfortunately, home improvement lends itself to contractor scams and fraud. To protect yourself from these unscrupulous members of the building community, there are several practices to look out for and several steps you can take to ensure you don't become a victim," the sheriff said in a statement. "Most contractors are honest, upstanding members of society."
--Watch out for "Travelers.” The most common contractor fraud involves "travelers" who go door-to-door soliciting work they never plan to provide. Be it roofing, repaving the driveway or remodeling, these scam artists posing as contractors offer cut rate prices with a sales pitch that often includes reduced prices due to leftover supplies from a job purportedly done in the area. The best way to avoid being a victim of this scam is to hit the phone book.
Don't accept offers from any door-to-door salesmen, ever. Instead call at least three reputable contractors in your directory to get bids on your job. If they post a listing in the yellow pages, at the very least you'll know where to find them, and where to send your lawyer, if something goes wrong along the way.
--Avoid fraudulent contractors by never paying cash up front. An easy way to spot contractor fraud is the payment schedule. A reputable contractor will never ask for cash, and will never require that the entire job be paid "up front." If a contractor asks for such provisions, your red flag should go up immediately. A good contractor rarely seeks payment until the job is done. Anyone who asks otherwise is probably looking to take your money and run. It's a tried-and-true tactic of fraudulent contractors, especially the aforementioned "travelers."
--Building permits and contractor fraud. Another way to spot a contractor who doesn't know the business is if they ask you to obtain your own building permits. A good contractor should do all this work themselves. It's part of what you're paying for. If they ask you to do permit legwork yourself, it's time to sever your ties and look for somebody who is willing to do the job you're paying for.
10 contractor fraud warning signs.
Here are a few things to watch for when you first come in contact with contractors.
1: Scare tactics
If a contractor tries to literally "scare up" your business, avoid him.
Sign 2: The hasty quote on a big job
When making a bid for your business, legitimate contractors do not scribble on scraps of paper or offer verbal quotes. They provide detailed written quotes. A repair contractor should thoroughly examine the problem and provide a written breakdown of the cost for labor and parts.
3: No identification
Legitimate contractors present themselves in a professional manner. They have business cards and an established street address -- not a post office box -- where they conduct their business. In an industry of many small independents, that street address might also be their home. That's OK. What's important is that you know where to locate them if anything goes wrong. Be cautious of anyone who cannot produce identification. They could be transient operators--people who work over an area, then disappear.
4: Refusal to provide referrals
Avoid contractors who refuse to provide referrals. Legitimate contractors are happy to name satisfied customers.
5: Pressure tactics
Pressure tactics for an immediate decision are intended to prevent you from shopping around or finding out that the deal is bad before it's too late. Be very cautious about a price that is "so good that it can only be offered today." Legitimate contractors offer quotes that are valid for a specific time period--usually 30 days.
6: 'We're in the neighborhood'
“We're in the neighborhood" lines are a warning. First, a legitimate contractor does not overbuy materials for a job and expect to unload them on the job site's neighbor. Second, a legitimate contractor will not take on a job to get rid of excess materials.
7: Up front payment
Requests for up-front payment before work begins should trigger a warning bell. Many people pay up front for work and then never see the contractor again. You should pay in advance of work only when it is a large job, you have already properly screened the contractor (checked references, performed a background check, etc.), and you have a proper contract.
8: Refusal to provide a written guarantee
No matter how sincere the assurance might sound, never accept a verbal guarantee. If anything really goes wrong, you'll quickly find out how worthless words can be. Legitimate contractors provide written guarantees that specify what is covered and for how long.
9: Under the table deals
Under the table cash deals usually mean that the contractor is not paying taxes, and therefore can cut his or her price. The catch is that you will have no paper record of the work--no receipt and no written guarantee. If a problem occurs, you'll have no recourse. Legitimate contractors do not indulge in this kind of practice.
10: Referral selling
If a contractor or "company representative" offers to give you a discount or rebate to refer customers or become a "model" home, be cautious. At best, this is a marketing gimmick. At its worst, it's an outright scam.