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DA’s Office warns homeowners about contractor fraud

Published: Aug. 27, 2021 at 4:17 PM MDT
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COLORADO SPRINGS, Colo. (KKTV) - As part of the ‘Financial Friday’ initiative at the 4th Judicial District Attorney’s Office, prosecutors want to make sure the community doesn’t fall for contractor scams.

Senior Deputy District Attorney Rachael Powell said it can be hard to prosecute this type of crime.

“There is no charge for contractor fraud,” she said. “It’s not a crime in and of itself. The charge that they would be charged with is theft.”

To be able to prosecute this charge, Powell said you have to prove that a suspect is taking something of value -- like money or supplies -- with the intent to ‘permanently deprive.’

“That’s the part where there’s a little bit of gray area with civil versus criminal,” Powell said.

In order to prevent people falling victim to this type of fraud, Powell provided six things everyone should do if they’re planning to hire a contractor to work on their home, lawn, or business.

1. Ask for recent references

“The more personal contact you can have, direct contact with that referral, the better because they can tell you if the job was completed on time, up to their standards, all of the things you would want to know before you enter into a contract with this person,” Powell said.

If someone tells you they don’t have any references, that’s a red flag.

Powell also recommends looking up the contractor on the Better Business Bureau. You can also check the Pikes Peak Regional Building Department.

2. Sign a contract

“So that means not an email exchange, not a text message exchange, definitely not just a handshake or a phone call,” Powell said. “This is a written contract that’s dated by you, signed by you, dated by the contractor and signed by the contractor.”

Within that contract, Powell said you should outline each thing you’re paying for, including labor and supplies.

“Are you able to use the toilet that you currently have in your bathroom, or are you asking them to purchase one and bill you for it? And that’s what’s included in your contract,” she said.

Anything you can get in writing will only help you if something goes wrong.

“Within that listing or that contract, have as many adjectives as possible,” Powell said. “So granite countertop, rather than just countertop. Any descriptors that let you know that you have a particular quality preference or requirement for your house or yard that maybe is unspoken or would be unspoken if it’s not in the written contract.”

Even if you know the person who’s doing work for you, Powell said you should still put it in writing.

3. Only pay half up front

In most of the cases the DA’s Office ends up prosecuting, Powell said the victim usually pays the total amount at the start of the project.

“I wouldn’t say that that is a normal business practice,” she said. “We have seen in cases that are not criminal, in people that are running their businesses well, that they’re asking for about half up front.”

4. Have a set schedule

Before getting to work, make sure you and your contractor are on the same page.

“Have them lay out when they believe the bathroom will be done, the landscaping will be done, the roof will be completed,” Powell said. “That just allows you to hold them a little bit more accountable for the progress of the job.”

If supplies are delayed and the timeline is pushed back, make sure to update the schedule.

5. Reach out to contractor first

If you start getting upset with your contractor, Powell said to address it with the person first before going to anyone else.

“Open that line of communication,” she said. “I think when there’s allegations of criminal activity or lawsuits -- some sort of civil lawsuit -- that usually creates a breakdown in communication.”

6. Know how to get ahold of your contractor

In order to keep the line of communication open, make sure you have good contact information for your contractor and any subcontractors working on your project.

“The contractor should also be able to get ahold of the property owner if there are questions while the work is being done,” Powell said.

When possible, Powell recommended communicating via email or text, so everything is in writing.

“People remember phone conversations differently,” she said. “If you have a text message, you can have documentation of changes that are being made or explanations for things.”

Powell said you should also keep track if your contractor stops responding to you.

“Things like missed calls, sent text messages, sent emails are just more records and written documentation you can use later on,” she said. “An example would be if you do continue to call, text, and email this contractor, and you continue not to hear from them, I’m sure you can see that just is more and more evidence of that intent to permanently deprive.”

Powell said if you’ve given money to a contractor, and the work isn’t being done according to the contract, that’s when you should contact police.

If you’re not comfortable calling police and would rather stay anonymous, you can always call Pikes Peak Crime Stoppers at 719-634-STOP.

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