“Hiring a contractor for home improvement projects can be intimidating. The undercover work that CSLB does to identify those contracting without a license helps to protect unsuspecting consumers. Licensed contractors have had background checks and have proven they know how to perform the work.” – CSLEA President Alan Barcelona
ROSEVILE – During the last week of March 2023, the Contractors State License Board (CSLB) went undercover in Roseville and caught more than a dozen people contracting without a license. The suspects are now facing fines and potential jail time for allegedly violating California contractor laws.
CSLB’s Statewide Investigative Fraud Team (SWIFT) partnered with the California Department of Insurance (CDI) and the Placer County District Attorney’s Office to issue Notice to Appear in criminal court citations to unlicensed contractors. Individuals were invited to place bids for residential construction projects at a single-family home. Of the suspects who came to the sting, 13 were caught for placing bids over the legal limit.
The bids ranged from $2,500 for carpet removal and installation to as much as $7,100 for concrete work, all above the legal $500 threshold for contracting without a license. In California, contracting without a license is a misdemeanor and punishable by a fine of up to $15,000.
Additionally, 11 of the suspects could face additional charges for advertising their construction services without having the mandatory license. In California, it is a misdemeanor for any person to advertise for construction or home improvement work unless they hold a valid license in the classification being advertised.
“There is little recourse for homeowners who have been victimized by an unlicensed contractor,” said David Fogt, CSLB Registrar. “That’s why CSLB educates consumers on how to protect themselves by hiring a licensed contractor – it takes just a few minutes to find a licensed contractor in California.”
During the sting, two individuals also asked for an excessive down payment ahead of starting the work. Contractors can only ask for 10% or $1,000, whichever is less. This is a misdemeanor that could result in charges of up to $5,000, or up to a one-year county jail sentence, or both the fine and imprisonment.
One individual was issued an order to cease all work until a workers’ compensation insurance policy is obtained for their workers. CSLB investigators can halt jobsite activity when any person, with or without a contractor license, does not have workers' compensation insurance coverage for employees. Failure to comply with a stop order can result in misdemeanor charges and penalties, including 60 days in jail and/or up to $10,000 in fines.
Penalties for not carrying workers’ compensation insurance can be severe. For a first-time offense, suspects could be sentenced to one year in county jail and/or pay a fine of up to $10,000. They may also be fined $1,000 per employee on the payroll at that time – up to $100,000. There are additional penalties if an injured worker files a workers' compensation claim, and the employer doesn't have the proper insurance. That employee can also file a civil action against the employer.