Following “Undercover House” Initiative, New Jersey Division of Consumer Affairs Cites 10 Unregistered Home Improvement Contractors; Investigation Serves as a Warning to Avoid Home Repair Scams After Hurricane Sandy

NEWARK – November 15, 2012 – (RealEstateRama) — Governor Chris Christie, Attorney General Jeffrey S. Chiesa and the State Division of Consumer Affairs are citing 10 unregistered home improvement contractors, and assessing civil penalties of $2,500 each, resulting from an “Undercover House” operation conducted in partnership with the Mercer County Office of Consumer Affairs.

The undercover initiative was held before Hurricane Sandy struck New Jersey. But Attorney General Chiesa noted it stands as a warning to those whose homes were damaged by the historic storm, and who are seeking to hire contractors as they recover from the damage, that they should check the credentials of any contractor they consider hiring.

“In the wake of Sandy, we’re working hard to help and protect New Jersey residents on all levels,” said Governor Christie. “We want to make sure that those who sustained damage from the storm don’t suffer further at the hands of unscrupulous contractors.”

Attorney General Chiesa said, “New Jerseyans whose homes were damaged by Sandy should be on alert. Now is the time when fly-by-night, unregistered contractors will descend on storm-damaged areas, seeking to make a quick profit at the expense of homeowners. New Jersey has 42,000 duly registered home improvement contractors; there is no shortage of good, professional help. If you don’t do your homework and hire a registered contractor with a good track record, you may spend thousands of dollars on a project, only to find yourself stuck with substandard, shoddy, and unsafe work.”

The Attorney General noted that consumers seeking to hire a contractor should contact the Division of Consumer Affairs at 800-242-5846 to learn whether the contractor has a current, valid state registration; and to learn whether the contractor has been the subject of consumer complaints. Consumers can also download the Division’s free New Jersey “Professional License Lookup” smartphone app, to check the registration or licensing status of home improvement contractors and licensed professionals.

The Division offers additional tips on “How to Avoid Disaster-Related Scams” in English at www.njconsumeraffairs.gov/disaster/floodtipsflyer_1.pdf and Spanish at www.njconsumeraffairs.gov/disaster/floodtipsflyerSP_1.pdf

The undercover operation in Mercer County took place in July, during the height of the home improvement season. In its initial phase, investigators from the State Division of Consumer Affairs and Mercer County Office of Consumer Affairs posed as consumers seeking to hire contractors for the renovation of a home in Titusville. The investigators booked appointments with unregistered contractors, some of whom who had commercial listings on Craigslist and other websites, in “home improvement guide” publications that were placed at convenience and grocery stores, and in local yellow pages.

During the operation’s second phase, the unregistered contractors came out to the Titusville home. The unregistered contractors spoke with the undercover investigators, who posed as the home’s owners. The investigators noted that, though the home had been empty for a few years and sustained minor damage, it could become beautiful again with the right work. The contractors examined the home and made estimates ranging from $2,500 to $50,000 for repairs such as painting, flooring, roofing, sheetrock work, and masonry work.

“One of the contractors showed up without a tape measure, ruler, meter, or any measuring device, and without even a notebook – and then made an estimate of $50,000, apparently based on what the investigators said they could afford,” Eric T. Kanefsky, Acting Director of the Division of Consumer Affairs, said. “Consumers should never hire a contractor without learning everything they can about the company’s reputation and abilities, and making sure they are duly registered with the state.”

The following contractors received notices of violation, each including a $2,500 civil penalty, as a result of the operation. It should be noted that two of the companies have since applied for registration and are now actively registered; and applications submitted by two more are currently pending.

• AA Construction, of Piscataway.
• Amidas Painting and Construction, LLC, of Chesterfield. (This company has since applied for reinstatement of its lapsed registration, and is now actively registered to perform home improvement work in New Jersey).
• First Choice Flooring, Inc., d/b/a/ Frank White Floors, of Fairless Hills, Pennsylvania. (This company has since applied for reinstatement of its lapsed registration, and its application is pending).
• Get it Done Painting, of Trenton.
• Home Code, LLC, of Highland Park. (This company has since applied for reinstatement of its lapsed registration, and is now actively registered to perform home improvement work in New Jersey).
• MLA Home Improvements, aka Mr. Yard & Home, of Somerville.
• Mudry Construction, LLC, of Mercerville. (This company has since applied for reinstatement of its lapsed registration, and its application is pending).
• NE Home Improvements, of Philadelphia.
• Sonny Signo & Sons Home Repair & Remodeling, of Elizabeth.
• Tara Construction, of Lawrenceville.

All 10 contractors were cited for advertising and/or offering to perform home improvement work despite lacking State registration, in violation of New Jersey’s Contractors’ Registration Act and regulations. Each contractor has the opportunity to request a hearing before the Director of the Division of Consumer Affairs, if they dispute the allegations. Violators of the Contractors Registration Act are subject to civil penalties of up to $10,000 for the first violation, and up to $20,000 for second and subsequent violations.

“The Mercer County Division of Consumer Affairs diligently protects on a daily basis all consumers of Mercer County against unscrupulous home improvement contractors and will assist in prosecuting where appropriate to the fullest extent of the law any violations of the NJ Contractor’s Registration Act,” said Mercer County Executive Brian M. Hughes. “While the majority of contractors are in compliance with the appropriate laws, those who are not should know that we are ever vigilant and will continue our fight for all consumers. I urge any Mercer County homeowner who has questions involving any contractor to call our County Consumer Affairs office at 609-989-6671 with any questions.”

Since 2006, New Jersey law requires anyone advertising or performing home improvement work to register with the Division of Consumer Affairs. New Jersey’s Contractors’ Registration Act and regulations protect consumers by helping ensure the accountability of those performing residential improvements. The Act and regulations require contractors to demonstrate they have a legitimate business address that is a street address, and at least $500,000 in liability insurance, before they can become registered. The Act also requires that all home improvement contracts in excess of $500 contain clear language, including the project’s agreed-upon price, starting and ending dates, and scope of work.

Tips for Consumers, When Hiring a Contractor:

• Beware of fly-by-night opportunists who may have come in from out of state — or those who may live locally but lack the skills and honesty you need for a significant repair job. In addition, learn whether the contractor is properly registered with the Division of Consumer Affairs.
• Call the Division at 800-242-5846 to learn whether the contractor is duly registered, and whether the business has been the subject of consumer complaints. You can also check the Division’s online listing of legal filings to learn whether the business has been the subject of legal action by the Division.
• Consumers can also utilize the New Jersey “Professional License Lookup” app, available free of charge from the Division of Consumer Affairs, to check the registration or licensing status of home improvement contractors and licensed professionals.
• Before hiring a contractor, demand a copy of the contractor’s liability insurance policy, and contact the insurer to make sure the policy is valid.
• It is customary not to pay for the entire home improvement project in advance. The general rule of thumb is to pay no more than one-third beforehand, one-third halfway through, and one-third upon completion.
• Never give your credit card number or financial information to strangers over the phone or on the Internet.
• The law requires a written contract for home improvement work in excess of $500. The contract should include detailed information, such as start and completion dates, all work to be performed and the specific products to be used.

Attorney General Chiesa noted that the Division of Consumer Affairs conducted a similar undercover operation in the wake of Tropical Storm Irene, in partnership with the Bergen County Prosecutor’s Office and Lyndhurst Police Department. The initiative, based in a Lyndhurst home that was damaged by Irene, resulted in criminal and civil charges against a total of 11 allegedly unregistered contractors who advertised through flyers posted in the grocery stores of storm affected areas, or through online listings (Further details: www.nj.gov/oag/ca/press/01042012.htm).

Investigator Ron Regen, Investigator Ray Yee, and Ken Oh, of the Division of Consumer Affairs’ Office of Consumer Protection, and Donna Giovanetti, Chief of the Mercer County Office of Consumer Affairs, conducted the investigation. Deputy Attorney General Patricia Schiripo, of the Consumer Fraud Prosecution Section within the Division of Law, represented the State in this action.

Consumers who believe they have been cheated or scammed by a business, or suspect any other form of consumer abuse, can file a complaint with the New Jersey Division of Consumer Affairs by visiting its website or by calling 1-800-242-5846 (toll free within New Jersey) or 973-504-6200.

Follow the Division of Consumer Affairs on Facebook, and check our online calendar of upcoming Consumer Outreach events.

Media Inquiries-
Jeff Lamm or
Neal Buccino
973-504-6327

Citizen Inquiries-
609-984-5828