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Highlands Today

Vigilance, Proper Checks Can Prevent Contractor Fraud

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By BRAD DICKERSON

Highlands Today

Published: February 12, 2009

SEBRING - James Selke says it should have been a warning sign when Jabos Marine Construction owner John Clement reportedly required a $2,000 deposit before starting construction of a new seawall at a Lake Placid man's home recently.

The total cost of the project, including labor and materials, was $4,000.

Many area contractors do not require any deposit up front before starting a job, and if they do, it is usually between 15 to 25 percent, said Selke, who is a code enforcement official with the Highlands County Building Department.

"That would not be an unreasonable amount," he said. A contractor can always put a mechanic's lien on a home to ensure payment, he added.

Clement was arrested Jan. 30 on warrants charging scheming to defraud property under $20,000 and contracting without a license.

On Oct. 1, 2008, the victim said he met with Clement to sign a contract and discuss the details of the seawall construction, according to a sheriff's office report. He then wrote the defendant a check for the first $1,000 of the deposit, with the balance coming about a week-and-a-half later.

At the beginning of November, the victim contacted Clement, who said he was behind on another job and had not started the construction in Lake Placid. The suspect allegedly said he would start the work "promptly." On Nov. 20, the victim said construction on the seawall had still not begun. He told investigators he had called Clement roughly 25 to 30 times and left messages.

When Selke got involved in the investigation, he told authorities he was aware of other cases where Clement received money from customers and did not finish the work, the report stated. Because of those complaints, the suspect's contracting license was placed on hold on Sept. 23, 2008, before expiring on Sept. 30.

There is also the case of 35-year-old Eric Young, a contractor arrested Jan. 17 in Galveston, Texas, and charged with several counts of writing bad checks and doing incomplete work for victims of Tropical Storm Fay in DeBary, according to www.cfnews13.com.

Several homeowners alleged they paid for a majority of the work in advance, but Young never finished the jobs. He also reportedly wrote checks, which eventually bounced, as partial refunds.

If criminal complaints are levied against contractors, then law enforcement will become involved, as was the case with both Clement and Young.

Lt. Tim Lethbridge, with the Highlands County Sheriff's Office's Criminal Investigations Unit, has worked cases of contractor fraud over the years, but has not seen a recent spike in the number of criminal complaints he's been receiving.

His office, however, will not get involved if the complainer is simply unhappy with the work that was done.

"If a builder takes money and does not break ground or is unlicensed and is taking a contract, we do get involved," Lethbridge said.

How Not To Be A Victim

In tough economic times like these, no one can afford to be swindled out of thousands of dollars. When it comes to contract work, Selke has a number of suggestions to make sure others don't fall victim.

First, take the time to get information and bids from several contractors.

"If the contractor knows that others may be looking at your project, they may be a little more careful when giving a price," Selke said.

He advised that residents should also call the building department after they have spoken with contractors and get information on them, such as any complaints.

Helen McKinney, administrator for the Highlands County Building Department, said customers should also ask to see a contractor's local or state competency card.

McKinney also advises residents to call the building department to verify that a contractor has insurance.

Permit Required

In 90 percent of construction jobs, a permit is a necessity before work can begin.

No legitimate contractor would ever ask the property owner to pull a permit, according to Selke. If this happened, the customer would now be responsible for the workers doing the job, including any injuries.

"There's no reason that the contractor doesn't pull the permit," Selke said.

McKinney said there is a Web site, permits.hcbcc.org/egovplus, that would have information on local contractors.

In addition to a permit, customers should also have a contract with the person they are hiring to handle any and all construction.

"Have the contractor spell out what he's going to do," Selke said. "Have him put down a start date and an estimated end date. Most contractors don't even put that in."

Above all else, Selke advises potential customers to always remember that they call the shots as long as no money has exchanged hands with a contractor.

"They're (customers) in control of the money, so they're in control of the project," he said.

Highlands Today reporter Brad Dickerson can be reached at (863) 386-5838 or bdickerson@highlandstoday.com

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