NBC 10 I-Team: Contractor complaints in Rhode Island rise 30%
The NBC 10 I-Team found the issue of contractors scamming consumers out of money has jumped significantly since the start of the pandemic. (WJAR)
Spring is a big construction season in Southern New England, but before you hire a contractor you may want to do your research.
The NBC 10 I-Team found the issue of contractors scamming consumers out of money has jumped significantly since the start of the pandemic.
According to the state Department of Business Regulation, there has been a 30% increase in complaints from 2019 to 2021, most of them involving contractors who take a consumer’s money, but never finish the work. It’s a story the I-Team has been covering for years.
In 2021, we spoke to a Massachusetts man who lost $5,000 after hiring a contractor to fix his roof.
A Woonsocket family called the I-Team in 2018 after a contractor allegedly took more than $23,000, then disappeared.
Those complaints just scratch the surface. Between 2009 and 2019, DBR averaged about 300 consumer complaints over contractors per year, but that number is rising. In 2021, 420 consumers issued complaints about contractors.
Department of Business Regulation Deputy Director Julietta Georgakis said she believes the increase is related to a growing number of home improvement projects during the pandemic.
“We’re just having a lot more construction in the state, coupled with the fact that real estate is booming,” Georgakis said. “People want to sell, so they’re hiring contractors to do a little renovation hoping they can get that in the market. I think that’s what’s going on.”
There are over 10,000 registered contractors in Rhode Island, but state Building Code Commissioner James Cambio said they're typically not the problem.
"It’s a very small percentage," he said. "We see the claims come in. We have a lot of repeat offenders."
The I-Team learned most of the repeat offenders are non-registered contractors working illegally in Rhode Island, which means pulling their license isn’t an option.
"Being a small state as we are, a lot of contractors come in from Connecticut and Massachusetts and aren’t registered to work here," Georgakis said. "We can’t serve them across state lines, so they just come in, they do a money grab, and they leave."
Cambio said they can go after them in a different state if it’s over a certain amount of money, but first they have to find them.
"If we don’t catch them while they are here and get enough of information, once they’re out of state we won’t find them,” he said.
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How do you protect your money?
Georgakis says there are several warning signs consumers should watch out for, including contractors who ask for cash or ask for more money after a down payment is given.
"f you give a deposit and your contractor was supposed to start work on a day specified and they don’t, you are not going to lure them in faster if you keep giving them money," Georgakis said. "This is one of the things that we are finding particularly in the pandemic.”
Per DBR, some other red flags include:
- Refusal to provide registration and insurance information.
- Refusal to provide reference information
- Refusal to enter into a written contract. In RI, a written contract is required when the cost of the work exceeds $1,000.00.
- Refusal to pull permits.
- For most renovation projects, a building permit is required. If you are unsure whether your project would require a permit, you should contact your local building department.
- Lack of experience with your type of project.
- Request for an excessive deposit.
While Rhode Island law does not cap the percentage of the total contract price that a contractor can ask for as a deposit, in some other states, contractors are prohibited from asking for more than 10-30% of the total contract price as a down-payment before work begins.
Cambio said the bottom line is consumers need to do their homework before hiring anyone.
"Do your due diligence. Ask them if they are registered, call us to confirm they’re registered," he said. "Are they reluctant to pull permits? That’s a big red flag. If they don’t pull permit that probably means they’re not registered."
Contractors who are registered in Rhode Island can face hefty fines for not completing work, including up to $5,000 for a first offense and $10,000 for a second offense.
They can also lose their registration.
DBR pulls an average of 10 to 15 registrations per month, following consumer complaints.
A contractor can also be disciplined by the Registration and Licensing Board.
If the contractor fails to comply with the disciplinary action, the case can be handed over to the state Attorney General’s Office.
Forty-six contractors in Rhode Island have been prosecuted by the Attorney General's Office since 2019.