Contractors Prey on Hurricane, Wildfire Victims After Disasters

October 9, 2018

The news that Florida’s Disaster Fraud Action Strike Team (DFAST) has been activated in response to Hurricane Michael is a reminder that after a devastating hurricane or wildfire, homeowners may be victimized a second time – by unscrupulous contractors. Recent press releases by government agencies and insurance associations after Hurricane Florence highlight the ways contractors may deceive unsuspecting homeowners.

Just last month the Coalition Against Insurance Fraud reported on a Louisiana contractor who skipped out on flood repairs. Matthew Morris with Complete Construction Contractors llc (CCC), was indicted on 51 counts of contractor and insurance fraud, theft, extortion, and more just in Livingston Parish in 2017. He was indicted on another 84 counts in Ascension Parish. He was also charged with several counts in East Baton Rouge, St. John the Baptist, and Terrebonne parishes.

Morris would sign contracts with victims from the August 2016 flood and either leave the work in between or never show up, according to victims. When the victims would not pay, Morris put liens on their properties.

“We worked on about 40 some projects, the demolition, through a lot of failed promises, failed to get paid on the work we did. Right now, I think he still owes me $270,000 and probably another $100,000 in attorney fees,” said Jameson Chauvin, a subcontractor who owned the company doing demolition work for CCC.

Of his 51 counts he was indicted on, 50 charges were dropped as long as Morris plead to one count which included restitution for all victims and jail time.

Several victims of Morris were in the courthouse as Morris took his first plea since the August 2016 flood. Victims in the courtroom refused to give any victims’ impact statements, saying they simply wanted closure and to move on.

“It’s just closure for us and we can move on,” said Lee Weber, one of Morris’ victims.

Morriswas sentenced to credit for time served. The total amount of restitution is $85,434.30, which will be divided among 11 victims in Livingston Parish.

After a series of wildfiresthis year, California Insurance Commissioner Dave Jones warned of contractor scams in an August 2018 press release.

According to the state’s department of insurance, the most common fraud schemes that occur in the aftermath of a disaster generally involve price gouging, offers of debris removal, and fraudulent charitable solicitations.

“A wildfire leaves more than burned homes and uprooted lives in its wake,” said Insurance Commissioner Dave Jones. “These catastrophes also can blow in fly-by-night unlicensed contractors and door-to-door scam artists eager to capitalize on the misfortunes of innocent and traumatized wildfire survivors.”

The Insurance Institute for Business & Home Safety (IBHS) recommends that homeowners stay vigilant against being victimized by fraudulent contractors. the IBHS points to a recent conviction in the Houston area of a fraudulent contractor taking advantage of homeowners following Hurricane Harvey.

“Unfortunately, severe storms can bring out the worst in people, especially crooked roofing contractors who take advantage of homeowners’ needs to repair or replace their storm-damaged roofs,” said Fred Malik, vice president of IBHS’ FORTIFIED programs. “These bad actors often make false promises, insist on full payment before work begins or is completed, and even create damage where none existed. Remember, price is only one element of the criteria for selecting a roofing contractor. Professionalism and quality workmanship also should weigh heavily on your decision.”

According to the International Code Council (ICC), following Hurricane Katrina in 2005, more than 1,300 people were prosecuted for contractor fraud, according to U.S. Department of Justice information.

“As homeowners begin seeking help to clean up and repair storm damage, it’s really important that they
be cautious about the contractors they hire,” said Chris Hacke PCI senior director. “Unfortunately, there
are instances of unscrupulous, unlicensed contractors who try to take advantage of storm victims. After suffering storm damage, the last thing homeowners need is to be ripped off by a fraudulent contractor.”

The ICC recommends that homeowners remain vigilant when searching for contractors when they start rebuilding their homes. After a natural disaster, many cities experience an influx of out-of-town contractors, or so-called “storm chasers.” Some are shady crews looking to take advantage of local residents desperate to restore their homes quickly.

Government agencies and industry associations offer several tips to avoid contractor fraud. These include getting contractor recommendations from insurers or neighbors, checking state licensing agencies and online resources for reviews.

In addition, homeowners are urged to avoid paperless contractors who have no business card or company fliers and remain wary of contractors who have no permanent street address or local phone number. Estimates, materials, prices and completion dates should all be communicated in writing and contractors should be able to provide proof of a contractor’s license and workers compensation insurance or builder’s risk insurance certificate. Lastly, homeowners are cautioned to never sign a blank contract. The ICC says some dishonest contractors will ask a homeowner to sign a contract for repairs on a digital tablet. However, when printed out, the bid is thousands of dollars higher, or the survivor may have unwittingly assigned FEMA disaster aid over to the scammer.

Working with the Federal Emergency Management Agency (FEMA) and local legal aid offices, the Disaster Legal Services Program of the ABA Young Lawyers Division (ABA YLD) has been offering legal assistance to disaster victims after Hurricane Florence on disaster-related legal issues that include landlord/tenant problems, insurance claims, FEMA claims and consumer issues such as contractor fraud.

Since September 2007, the ABA YLD has responded to more than 178 declared disasters in 44 states and four U.S. territories. In the last year, hundreds of lawyers volunteered to provide legal assistance to those affected by hurricanes Harvey, Irma and Maria, as well as wildfires in the West and other natural disasters.

Was this article valuable?

Here are more articles you may enjoy.