Be Vigilant For The Disaster Scam Artists
Release Date: July 3, 2008
Release Number: 1769-011
» More Information on West Virginia Severe Storms, Tornadoes, Flooding, Mudslides, and Landslides
BRIDGEPORT, W.Va. -- Like moths to a candle, disasters seem to attract slippery predators skilled at preying on the pain and misfortune of others.
That is a warning by officials of Federal Emergency Management Agency (FEMA) and the West Virginia Division of Homeland Security and Emergency Management (DHSEM) to residents affected by the storms, tornadoes, flooding and other severe weather of June 3-7.
"In disaster situations, there are often those who are ready to take advantage of such situations," said State Coordinating Officer Jimmy Gianato. "Be especially alert for phone or door-to-door solicitors who hand out flyers and promise to speed up the insurance or building permit process, and those who ask for large cash deposits or advance payments in full."
Consumers should also be aware that some scam artists may pretend to be employed by FEMA or other agencies. Some traits of such predators can include:
- Lack of proper identification - A FEMA or U.S. Small Business Administration (SBA) shirt or jacket is not absolute proof of someone's affiliation with an agency. Ask to see the laminated photo identification card; if they don't have it, don't deal with them.
- Going door-to-door - Persons going door-to-door to damaged homes or phoning victims claiming to be building contractors could be frauds. If callers solicit personal information such as Social Security or bank account numbers, they are not official. FEMA inspectors may come to your neighborhood, but all FEMA inspectors will have proper photo identification. Remember: FEMA and U.S. Small Business inspectors never charge applicants for disaster assistance or for inspections. If in doubt, do not give out information.
- Charging fees to be put on a list or fees to have forms filled out - Some scammers have asked for upfront money to be put on a list or demanded fees to fill out the disaster loan application.
- Offers to increase the amount of your disaster damage assessment - This is not wise and is a sure sign of a scam.
- Asking for cash upfront - Under no circumstances are FEMA and other agency representatives allowed to accept money. FEMA inspectors assess damage but do not hire or endorse specific contractors or determine eligibility.
"Whether they are architectural, engineering, electrical, or general contractors, most service providers in the building industry are honest," said Ed Smith, federal officer in charge of recovery. "Sadly, disasters attract scam artists. Some claim to be 'FEMA certified' when, in fact, FEMA neither certifies nor endorses any contractor."
Tips for hiring contractors include:
- Get a written estimate. Compare services and prices before making a final decision. Also, read the fine print. Some contractors charge a fee for a written estimate, which is often applied to the cost of subsequent repairs they make.
- Check references. Contractors should be willing to provide names of previous customers. Call several former customers who had similar work done to make sure they were satisfied with the job.
- Ask for proof of insurance. Make sure the contractor carries general liability insurance and workers' compensation. If the contractor is not insured, the homeowner may be liable for accidents that occur on the property.
- Use reliable, licensed contractors. Call your local Better Business Bureau to inquire about a business before signing a contract.
- Insist on a written contract. A complete contract should clearly state all tasks to be performed, all associated costs and the payment schedule. Never sign a blank contract or one with blank spaces. Make sure the contract clearly states who will apply for the necessary permits or licenses. Have a lawyer review the contract if substantial costs are involved, and keep a copy for your records.
- Get guarantees in writing. Any guarantees made by the contractor should be written into the contract. The guarantee should clearly state what is guaranteed, who is responsible for the guarantee and how long the guarantee is valid.
- Obtain a local building permit, if required. Permits may be required for site work, other than demolition, and for reconstruction. Contact your local government for permit information.
- Make final payments when the work is completed. Do not sign completion papers or make the final payment until the work is completed to your satisfaction. A reputable contractor will not threaten you or pressure you to sign if the job is not finished properly.
- Pay by check. Avoid on-the-spot cash payments. The safest route is to write a check to the contracting company. A reasonable down payment is 30 percent of the total cost of the project, to be paid upon initial delivery of materials. Federal law gives consumers a three-day "cooling off" period for unsolicited door-to-door sales of more than $25.
- If necessary, cancel a contract in the proper manner. This should be done within three business days of signing. Be sure to follow the procedures for cancellation that are set out in the contract. Send the notification by registered mail with a return receipt to be signed by the contractor.
If you suspect fraud, waste or abuse, call FEMA's Inspector General's Office, 800-323-8603.
FEMA coordinates the federal government's role in preparing for, preventing, mitigating the effects of, responding to, and recovering from all domestic disasters, whether natural or man-made, including acts of terror.
Last Modified: Thursday, 03-Jul-2008 17:55:39