Randy F: I was wondering what is the best way to report a company for fraud? They took over $42,000 from my wife and I to do work on my house then skipped out before the work was done. We paid cash in full, and even took out loan on the house.
JW: Randy, if you’ve been scammed by a contractor, obviously you need to notify your local police and file a report. Your next step is to report the scammers directly to the Federal Trade Commission, either online at ftc.gov, or by phone at 1-877 - FTC HELP. We got a few tips from the FTC on how to protect yourself from these con men, so they don’t get a chance to get your hard-earned money:
- Whenever you deal with a contractor, always check their identification and references. Try talking to a friend, a relative, a co-worker, neighbor or someone you trust to see who they’ve used in the past. References are a great way to help you find someone reliable.
- Make sure the contractor is licensed, and insured. You can also check with the local Better Business Bureau and Home Builders Association to see if the they have ever had any complaints filed against them.
- Always get a written estimate of costs.
- Never pay more than the minimum in advance.
- Use a check or a credit card to pay the cost, but only after work has been finished and you are happy with the job done.
2 Comments on "How Can I Avoid Contractor Fraud?"
MB
Is there somewhere I can look at a database of wanted criminals or fugitive pictures to ensure I’ve not already hired one of them. That could help prevent the crime from happening for sure.
Greenwich Homeowner
Be careful with neighbor references. A neighbor may not be all that reliable since their idea of a “good” job is far below your idea of an acceptable job.
But make certain you check their credit history with their local suppliers. This is a big key in the due diligence that is missing from so many advisory panels. If they don’t have several years of good history with the suppliers, then DO NOT HIRE THEM.
The bad guys don’t have long histories with anyone, and they don’t pay their bills.
Do a Dun and Bradstreet on the contractor to check out his rating, too.
Find out about his personal assets and see if this guy has a good credit standing in his own life. Often a criminal contractor has no credit, no history, and no track record.
Be very careful.
Please Leave a Comment!