Illegal Contractors may Face Felony Charges following Contractors State License Board Undercover Investigation in Southland Fire Zone
Sting operation targets felony violators in declared disaster area
LOS ANGELES — The Contractors State License Board (CSLB) is keeping its pressure on phony contractors who try to profit from the recent Southern California wildfires. CSLB teamed with the Department of Insurance, the Los Angeles District Attorney’s Office and the Los Angeles Police Department to conduct an undercover sting operation on Wednesday. The operation targeted illegal operators advertising for construction work in the fire.
Investigators from CSLB’s Statewide Investigative Fraud Team (SWIFT) posed as fire victims at two different homes in Sylmar, not far from Veteran’s Memorial Park. Investigators requested written bids on projects that included landscaping, tree removal, painting and other fire-related damage. Evidence was collected for possible prosecution of the suspects for acting in the capacity of a contractor, without a license, in a declared disaster area, (Business & Professions Code 7028.16).
Suspects were singled out because of business cards and flyers left in the fire zone, newspaper ads, and for potentially being repeat offenders. A total of 10 people were detained, but not arrested. Investigators informed them that they committed what could be a felony and educated them on how to get a state contractor’s license. Eight of cases will now be turned over to the Los Angeles County District Attorney’s Office. That office will determine what charges will be filed. One unlicensed operator was given an administrative citation, with a civil penalty of $2,250. One person was licensed, and may receive an administrative citation. Two arrests were made: 82-year-old Albert Prizant was taken to jail on a $50,000 warrant for contracting without a license. Prizant, who was targeted for his ad in a local newspaper, has a long history with CSLB for his work as a phony contractor, including more than one dozen criminal cases and a current open complaint. The other arrested man carried no identification, except for an expired Israeli Visa. He is identified as Tzchi Leon, 38.
CSLB staff has been an active and visible presence in the Southern California disaster areas since last month’s wildfires, meeting with fire victims and posting hundreds of warning signs. "The idea is to discourage rip-off artists before they even consider taking advantage of fire victims," said CSLB Registrar Steve Sands. "We will continue to be aggressive in going after phony contractors even after the rebuilding is well underway." The reason for ongoing enforcement stings is to heighten the awareness that homeowners need to have when they hire people to rebuild their homes, and to let illegal operators know that violators will be pursued, jailed and prosecuted.
"After people have had their homes damaged or destroyed, it's despicable that scam artists are out there trying to steal from the fire survivors," said Insurance Commissioner Steve Poizner. "We won't let them be victimized twice. I'm proud of our Department's collaboration with local law enforcement and the Contractors State License Board to crack down on these criminals."
Contractors working on any job – from debris removal to roof repair to rebuilding – totaling $500 or more for labor and materials must be licensed by CSLB. It is illegal and punishable as a felony to perform contracting work in a state or federally declared disaster area without a valid California contractor’s license. Punishment may include a fine of up to $10,000 and/or up to 16 months in state prison.
To become licensed, a contractor must have at least four years of journey-level experience and pass two licensing exams. California contractors must carry a license bond, and provide workers’ compensation insurance for their employees. A homeowner could be at risk if workers who aren’t covered have an accident while on their property.
Homeowners should look closely at any paperwork or contracts they are handed. A standard home repair contract is required to have a three-day "Right-To-Cancel" notification. However, there is a provision called a Service and Repair Contract that waives the consumer’s right to cancel the moment paperwork is signed and the job gets underway. Consumers should take time to make the right choice.
Consumers can verify a contractor’s license status through CSLB’s Web site at
www.cslb.ca.gov
or through its toll-free automated telephone system at 1-800-321-CSLB (2752). Find out if the contractor’s license is active and in the right classification for the work to be done. Consumers can also see if there are any legal complaints against the contractor, if the business name and address are correct, and if there is workers’ compensation insurance coverage for employees. Consumers can download tips and publications on topics like disaster scams, hiring a contractor, and home improvement contracts from the CSLB Web site. The Web site also has a location for people to report unlicensed activity.
Homeowners can find contractor license information and tips on how to protect themselves by using CSLB’s online resources at
www.cslb.ca.gov
. Information is also available from the California Department of Insurance on how to work with adjusters and other rebuilding steps at
www.insurance.ca.gov
. CSLB has also activated its Disaster Hotline for fire victims. It is available Monday through Friday, 8 a.m.-5 p.m. at 1-800-962-1125.
The CSLB urges consumers to follow these tips when dealing with a building contractor:
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Hire only licensed contractors and ask to see the license.
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Don’t hire the first contractor who comes along.
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Don’t rush into repairs, no matter how badly they’re needed.
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Verify the contractor’s license at
www.cslb.ca.gov
or 1-800-321-CSLB (2752).
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Don’t pay more than 10 percent or $1,000, whichever is less, as a down payment.
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Don’t pay in cash, and don’t let the payments get ahead of the work.
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Get three bids, check references, and get 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 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
