New Jersey Division of Consumer Affairs Files Action Against Ocean County Home Improvement Contractor for Allegedly Bilking Six Homeowners Out of Nearly $300,000 in Superstorm Sandy Relief Funds

NEWARK – (RealEstateRama) — Continuing the State’s crackdown on Superstorm Sandy fraud, Attorney General Christopher S. Porrino and the Division of Consumer Affairs have filed an action against a Manahawkin contractor and his home improvement company for allegedly bilking $280,750 in Sandy relief funds from six shore homeowners that hired him to renovate and elevate their storm-damaged homes.

George LaRosa and his company, GL Construction Limited Liability Company (“GL Construction”), took initial payments from consumers for home improvements and elevations and then failed to begin work, performed work in a substandard manner, and/or abandoned unfinished projects without returning for weeks, months, or at all, according to a Complaint filed by the State in Ocean County Superior Court.

The six homeowners named in the Complaint were all recipients of federal grants from the Department of Community Affairs’ Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) Program, the state’s largest rebuilding initiative in the wake of Superstorm Sandy in 2012.

“GL Construction advertised on its website that its work would exceed customers’ expectations. In reality, the defendants exceeded customers’ worst nightmares by allegedly walking off with their money, leaving behind unfinished projects, shoddy workmanship, and/or construction that was not up to code,” said Attorney General  Porrino. “What makes the defendants’ alleged actions all the more repugnant is that they preyed on people relying on federal grant money to help them recover from Superstorm Sandy.”

This is the third Complaint the Division of Consumer Affairs has filed against contractors who allegedly defrauded Sandy victims out of RREM funds.

“Superstorm Sandy left thousands of people homeless, wondering who to turn to for help rebuilding their homes and their lives,” said Steve Lee, Director of the Division of Consumer Affairs. “We intend to hold accountable each and every contractor found to have financially exploited consumers left vulnerable by this natural disaster.”

“Dishonest contractors not only hinder Sandy-impacted families from rebuilding their homes, they also impede the state’s overall recovery effort,” said Department of Community Affairs Commissioner Charles A. Richman. “We thank the Division of Consumer Affairs for diligently investigating Sandy contractor fraud claims and taking legal action against contractors when warranted. This important work shows the state is rooting out deceptive contractors and helping Sandy survivors get their rebuilding projects back on track.”

On its website, GL Construction alluded to new home elevation requirements mandated by the Federal Emergency Management Agency (“FEMA”) in the wake of Superstorm Sandy.

“When it is time to raise your home you want to make sure you are working with a company that is not only qualified but experienced in the process,” the website advertised.  “GL specializes in waterfront properties and has the experience and expertise you are looking for. We are experts in the current FEMA and local building requirements.”

In reality, GL Construction was not registered with the State as a home elevation contractor, as required, and at varying times, the defendants performed home elevation and renovation in a substandard manner including: failing to raise a house to the required level, installing a foundation that failed municipal inspection, incorrectly framing a house, failing to install the required fire-resistant sheetrock incorrectly framing a doorway so the door did not fit, and incorrectly installing flooring, necessitating reinstallation, and then failing to make the necessary corrective repairs, the Complaint alleges.

The Complaint alleges that LaRosa and GL Construction violated the Consumer Fraud Act, the Contractors’ Registration Act, the Home Elevation Regulations, the Home Improvement Regulations, and the Advertising Regulations, by actions that include:

• Failing to begin and/or complete the home improvement and/or home elevation work specified by the GL Home Elevation contract.
• Failing to respond to consumer calls, e-mails and/or texts inquiring into when defendants would continue home improvement work, home elevation work, and/or construction of a new home that had been commenced, but then had been abandoned.
• On at least one occasion, misrepresenting to a consumer that a building inspection had been conducted, when such was not the case.
• Failing to perform work they were paid to perform, thus requiring consumers to pay other home improvement contractors to perform the work.
• Failing to pay subcontractors who performed home improvement, home elevation or new home construction work, resulting in subcontractors seeking payment from consumers and/or threatening to place construction liens on the consumers’ homes.
• Advertising and/or performing home elevations without being registered as a Home Elevation Contractor.

The Complaint seeks consumer restitution, the disgorgement of unlawfully acquired or retained RREM funds to the Department of Community Affairs, reimbursement of attorneys’ fees and costs, and civil penalties. The state also seeks to cancel the Certificate of Formation in the State of GL Construction, Limited Liability Company, permanently revoke the Home Improvement Contractor and New Home Builders registrations issued to GL Construction, and permanently enjoin the defendants from owning or operating a home improvement business in New Jersey, and from advertising and or performing home improvements, including home elevation, and new home building, within the State.

Investigators Joseph Iasso and Brittany Kieran of the Division’s Office of Consumer Protection conducted the investigation.

Deputy Attorney General Alina Wells, of the Consumer Fraud Prosecution Section within the Division of Law, is representing the State in this action.

Matthew H. Sontz, Esq. is representing the defendants 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 an online complaint with the State Division of Consumer Affairs by visiting its website or by calling 1-800-242-5846 (toll free within New Jersey) or 973-504-6200.

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