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Illegal contractors arrested

Sting reveals problem on the rise as recession continues to take its toll

Posted: September 24, 2009 10:37 p.m.
Updated: September 25, 2009 7:00 a.m.
 
Twenty-nine unlicensed contractors showed at a Saugus home last week for what they thought were potential work bids.

Instead, they got handcuffs.

Los Angeles County sheriff’s deputies arrested them and gave them notices to appear in court in November for misdemeanor charges.

The sting operation comes as the recession has driven up the demand for cheaper, unlicensed contractors and worsened problems for legitimate contractors, who have already lost much of their work in the economic crisis.

“These illegal contractors really hurt the legitimately licensed contractors,” said sheriff’s Sgt. John Bomben, who said many of the people arrested were chosen for the sting because of complaints by local citizens and contractors.

Santa Clarita Valley Sheriff’s Station deputies teamed with Contractors State License Board investigators to conduct the two-day fall “California Blitz” on Sept. 15 and Sept. 16, Bomben said. It was Santa Clarita Valley’s second sting after one that occurred in the spring.

The unlicensed contractors may face misdemeanor charges of illegal advertising, contracting without a license and charging excessive down payments, according to a report from the CSLB.

In the undercover operation, deputies and other officials pose as potential clients. They invite unlicensed contractors to do make a bid on a construction or landscaping project, and arrest whoever shows up without proper licensing.

It is illegal in California do more than $500 of contracting work without a license.

The board’s Statewide Investigative Fraud Team, or S.W.I.F.T., teams have issued 1,371 notices to appear in court and citations to unlicensed contractors in the Los Angeles area from 2006 to 2009, said the board’s spokeswoman Venus Stromberg.

Of the 29 people arrested in the sting, only three were from the Santa Clarita Valley — one each from Saugus, Newhall and Valencia.

The local contractors arrested were Chris Roy Rostad, 48 of Valencia, Cesar I. Rodriguez, 33 of Saugus, and John Rubalcava, 57 of Newhall, according to the board's report.

The rest were mostly from Los Angeles, while others came from the San Gabriel Valley, the Antelope Valley and the South Bay.

With the downturn of the economy, more licensed contractors are taking action against their illegal competitors, Stromberg said.

“Contractors might have been booked for weeks at a time when the economy was good and when people were contracting more,” she said. “Without much building going on, there’s not as much work for licensed legitimate contractors ... (Trade associations) have noticed it more and their members are complaining more.”

Meanwhile, the economy may also be leading clients to encourage the practice of illegal contracting, Stromberg said.

“In many instances, people are trying to save a buck, so people tend to go with the lowest bidder,” she said, explaining that illegal contractors usually have lower fees because they do not pay licensing fees, worker compensation, bonds or other liabilities.

However, those instances can lead to higher payments if something is broken or someone is injured, Stromberg said.

“You might end up paying for it,” she said.

The California State License Board encourages clients to use its online service that allows customers to verify licenses and complaints against contractors.

They also advise people to never give a down payment of more than 10 percent of the job’s value or of $1,000, whichever is less.

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