img

Unlicensed Contractor

Unlicensed Contractor Can Face Up To 16 Months In Jail & Restitution

Twenty years of consumer complaints caught up with Esteban Casillas in September 2004 when he received a 16-month jail sentence and was ordered to pay $57,316 in restitution to the San Diego County homeowners he victimized. Casillas learned the hard way that each subsequent conviction for contracting without a license often carries a more severe punishment than the one before.

Throughout the years, Casillas has misrepresented his brother’s license number to get landscape contracts. He would typically take money from his victims and perform minimal or no work before abandoning the projects. Casillas was first cited by CSLB enforcement staff in 1985. Then, between 1990 and 2002, the Board referred 14 subsequent investigations to local prosecutors for various violations, including contracting without a license and fraudulent use of a license number.

Despite his previous citations and criminal conviction, Casillas continued his illegal contracting activities. In May 2000, he pled guilty to contracting without a license and was sentenced to 180 days in jail and five years probation. Casillas was also ordered to pay fines and restitution. Three months later in a different court, he pled guilty to fraudulent use of a license number and was sentenced to additional jail time and ordered to pay additional fines and restitution.

What Do You See As The Main Goal Of The Board’s Enforcement Program?

Clearly, our role is to protect consumers. It’s in our legislative mandate and it drives the Board’s goals and objectives. Now, we define consumers broadly. Consumers can be homeowners who hire contractors or members of the public who live or work in buildings and drive on freeways and over bridges. Consumers are also our licensees who are victimized by unlicensed persons, and even taxpayers who are cheated by the underground economy.

How Do You Defitne The Goal Of The Board’s Enforcement Program?

Well, the Board has actually stated that the goal is to “Reduce, eliminate or prevent unlicensed activity and unprofessional conduct that poses a threat to public health, safety and welfare.” The Board does a number of things to meet that goal: First, we educate consumers to prevent problems from occurring in the first place. Next, the Board works with consumers and contractors to resolve complaints early in the process. If necessary, CSLB helps consumers with legitimate, unresolved complaints against contractors. Lastly, the Board takes serious criminal or administrative action against contractors who violate the law and cause serious harm to a consumer.

How Is Cslb’s Enforcement Program Unique?

The CSLB regulates California’s largest industry, employing one million people, generating $60 billion in permitted construction each year, with nearly 300,000 licensed contractors who initiate millions of transactions a year. It’s a complex profession that requires a similarly complex and comprehensive regulatory scheme with professional industry-specific expertise. The Legislature has given CSLB’s enforcement program a wide variety of responsibilities and tools. In addition to ensuring the people who enter the profession are competent and possess the requisite bonds and insurance, the Board also provides a number of consumer remedies that complement its investigative and disciplinary processes.

What Are Some Of Those Remedies?

Like all licensing Boards, CSLB needs to regulate the industry to help make sure the marketplace functions correctly. CSLB’s mandate includes innovative programs to help individuals. Sometimes honest, competent contractors make mistakes. When this happens, the consumer will often just want the project fixed or their money back. The Board has a number of programs to help both contractors and consumers resolve disputes quickly:

  • Our Consumer Service Representatives initially screen complaints to mediate a resolution.
  • If the complaint involves present or future damages of $7,500 or less, the Board has a mandatory arbitration program. This extremely successful program has a satisfaction rating over 90 percent.
  • For complaints involving financial injuries between $7,500 and $50,000, the Board has a voluntary arbitration program.
  • In addition, the Board has initiated a thriving on-site negotiation program that we hope to expand down the road.
  • If the complaint can’t be resolved at that level, the Board might provide information to the consumer about how to file a small claims court action. Last November the California Dispute Resolution Council recognized these alternative resolution programs developed by the Board.

Are There Any Other Unique Aspects To The Board’s Enforcement Program?

Yes, we work closely with local building officials, focusing on unlicensed activity, the underground economy, and workers’ compensation violations. We have partnerships with the Division of Labor Standard Enforcement, the Department of Insurance, the Employment Development Department and other state and federal agencies to work on enforcement activities involving workers’ compensation fraud, tax evasion, and illegal contracting. We’ve taken on the role of being the leader in combating the underground construction economy that cheats California consumers and taxpayers out of hundreds of millions of dollars year after year.

What Successes Can You Identify In The Board’s Enforcement Program?

Our staff is top-notch. They are dedicated to fulfilling the Board’s mission and helping consumers and honest contractors. Many of our investigators come from the industry. Despite losing 20 percent of our investigative team, we’ve shortened the time it takes us to investigate cases. We were able to get more than $14 million in restitution for homeowners in 2004. We referred more than 1,000 non-licensee cases to District Attorney’s offices last year, conducted 34 sting operations resulting in 329 misdemeanor and 21 felony arrests, and issued 1,487 non-licensee citations assessing nearly $2 million in civil penalties. The staff has done so much with so little that we owe them a big thanks for a job well done.

What About Challenges Or Weaknesses?

Like every state agency, we have had to prioritize our limited resources. While most of the state’s economy stagnated, the construction industry boomed! Since 2000, we have had a 60 percent increase in the number of applicants for contractor licenses.

As I mentioned a moment ago, our enforcement staff has been cut. We lost 58 people in 2001 and 2002, requiring us to cut back some of our unlicensed investigations. The good news is that the State Administration recognizes the needs to battle the underground economy and is allowing us to hire 11 investigators to address that need. Because our investigators are not paid as much as comparable employees in other state agencies, the Board struggles to recruit and keep them.

What’s In The Future?

Our Board is fully engaged and committed to meeting our mission. The Board will continue to expand our public outreach so we can educate consumers before they get into trouble. We will continue to work as a leader in the Underground Economy Task Force in enforcing State licensing, labor, and tax laws. We’re looking at new ways to partner with building departments, including providing training on unlicensed activity and workers’ compensation violations. With these new initiatives, we hope to impact and deter the underground economy.