Flood Victims Should Be Alert to Possible Contractor Fraud 

Release Date: December 20, 2007
Release Number: 1734-013

» More Information on Washington Severe Storms, Flooding, Landslides, and Mudslides

Lacey, Wash. -- State and federal disaster officials warn that every disaster has its share of con artists trying to take advantage of disaster victims. Washington residents whose homes have suffered damage from the recent storms should be careful who they let into their homes or hire to make repairs.

Officials urge residents affected by the recent storms to be alert and report potential fraud as they clean up after the flooding and during rebuilding efforts. Some people may show up at the door and recommend expensive or unnecessary repairs. Others may offer to process disaster applications for a fee. Residents should know that federal or state disaster inspectors do not recommend repairs and NEVER charge a fee for any inspection of a home. If someone appears at the door claiming to be a FEMA or federal disaster official, residents should ask for photo identification.

Those who suspect anyone - a contractor, inspector, disaster victim or someone posing as any of these - of committing fraudulent activities should make a report to their local law enforcement office. They may also call the FEMA Fraud Hotline at 1-800-323-8603. Individuals reporting suspicious activity do not have to give their names.

Use care when hiring contractors:

Do research on contractors. Contact the local building inspector's office for information on local contractors. Check with the local Better Business Bureau, homebuilders' association, or trade council to see if the contracting firm has any unanswered complaints against it. Be suspicious of anyone who offers to increase the amount of your disaster damage assessment. Call former customers who had similar work done to see if they were satisfied with the job.

Ask for proof of insurance. If a contractor is uninsured, you may be liable for accidents on the property. Make sure the contractor has both disability and workers' compensation insurance.

Get it in writing. Ask for a written estimate, and check to make sure it includes all the work expected to be done, as well as taxes and other fees. Keep in mind that some contractors charge for an estimate. Once a contractor is chosen, ask that the written contract include all tasks to be performed as well as associated costs, a timeline and payment schedule and who is responsible for applying for necessary permits and licenses. Never sign a blank contract. Canceling a contract should be done within three business days of signing.

Get permits. Make sure the contract clearly states who will obtain the necessary permits. Have a lawyer review the contract if substantial costs are involved. Keep a copy of the signed contract.

Ask for a written guarantee. It should state what is guaranteed, who is responsible and how long the guarantee is valid.

Do not make advance payment in cash. Pay by check in order to keep a record and to avoid double charges. Legitimate contractors normally do not require more than one-third of the total charges as a down payment.

Make final payments only when work is completed. Do not sign completion papers or make the final payment until the work is completed satisfactorily. A reputable contractor will not threaten you or pressure a resident to sign if the job is not finished properly.

For more information on hiring contractors go to: www.Lni.wa.gov and look for hiring a contractor

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: Wednesday, 26-Dec-2007 11:35:19