LIVINGSTON, NJ – Livingston based LSI Enterprises, Inc., was one of 68 home improvement contractors that were recently issued violation notices from the New Jersey Division of Consumer Affairs.
The total $1.3 million in civil penalties and consumer restitution is the result of the Division’s investigation, which was sparked from complaints and referrals by consumers across New Jersey. The Division also received a total 1,434 consumer complaints about home improvement contractors in 2013, making that the largest consumer complaint category last year.
“Home improvement disputes are consistently the number-one consumer complaint category the Division of Consumer Complaints receives year after year,” Acting Attorney General John J. Hoffman said. “With this action we are demanding more than $1 million in restitution for consumers who paid for work that allegedly was never finished. We also are giving these contractors the opportunity to come into compliance with the law, and reminding New Jersey consumers to protect themselves by conducting basic research before hiring a contractor.”
Sixty-two of the 68 contractors have been instructed to pay a total of $1,046,978 in consumer restitution, in amounts ranging from $378 to $185,000, for allegedly failing to complete work that their customers had paid for in advance, failing to refund deposits, or other issues.
The Division has also cited all 68 contractors for violations of New Jersey’s Contractor’s Registration Act for failing to provide consumers with detailed, written contracts for home improvement projects costing more than $500.
In addition, 44 of the companies have also been cited for operating without being registered (LSI Enterprises being one of them) as home improvement contractors in New Jersey. The State has assessed a total of $276,250 in civil penalties against the 68 contractors, for a combined total assessment, including civil penalties and consumer restitution, of more than $1.3 million.
“When contractors fail to comply with the law, or the terms of their contracts, consumers can be left with costs in the tens of thousands of dollars and a house full of unfinished improvements,” Division of Consumer Affairs Acting Director Steve Lee said. “Our registration laws help place consumers on equal footing with the contractors they hire, and help ensure that those contractors can be held accountable.”
State law requires that all individuals or businesses who solicit and/or perform home improvement work must obtain registration from the Division of Consumer Affairs. The registration application requires demonstration that the contractor has a legitimate street address and at least $500,000 in liability insurance.
In addition, projects which exceed $500 require a written contract, created by the contractor and given to the consumer that includes specific, detailed information such as: the project’s agreed-upon price; the starting and ending dates; the scope of work; and the contractor’s business name, address, and registration number.
Each of the contractors receiving a Notice of Violation has the opportunity to contest the assertion that he or she has violated the law, or the opportunity to correct the violation by desisting from any practices in violation of the law, paying a civil penalty and/or consumer restitution where required, and submitting an application for registration, if not registered. Each contractor also may contest the Division’s assessment of consumer restitution.
Violators of the Contractors’ Registration Act are subject to civil penalties of up to $10,000 for the first violation, and up to $20,000 for subsequent violations.
The following tips for hiring a contractor were issued:
· Learn about any contractor before deciding to hire them. It is ideal to work with a contractor who is recommended by people you know. It also is advisable to ask the contractor for references and speak with those references about the contractor’s work.
· Contact the Division of Consumer Affairs to learn if the contractor is duly registered to perform home improvement work in New Jersey, and learn whether the contractor has been the subject of consumer complaints and/or legal action by the Division. You can call the Division at (800) 242-5846 or use the Division’s website, www.NJConsumerAffairs.gov.
· Before hiring the contractor, demand a copy of the contractor’s liability insurance policy and contact the insurer to learn whether the policy is valid.
· Obtain a written contract. Contracts for home improvement projects costing $500 or more must be in writing. They must include the legal name, business address, and registration number of the contractor as well as a start date, completion date, description of the work to be done, and the total price.
· Make sure all warranties and guarantees are in writing, and that the contract states the name brands or quality/grades of the materials to be used.
· Ensure that all applicable construction permits are obtained from the appropriate municipality.
· Remember that it is customary not to pay for the entire project in advance. The general practice is to pay for one-third in advance, one-third halfway through, and one-third upon completion.
· Additional tips can be found in the Division’s Consumer Brief on “Hiring Home Improvement Contractors,” available in English at http://www.njconsumeraffairs.gov/brief/improve.pdf and in Spanish at http://www.njconsumeraffairs.gov/brief/improve.pdf .
The following information for Home Improvement Contractors were also issued:
To advertise and perform home improvement work legally in New Jersey, contractors must register with the New Jersey Division of Consumer Affairs. Registration materials and information are available at http://www.njconsumeraffairs.gov/HIC/ .
Investigators Joseph Iasso, Jared O'Cone, Donna Leslie, Juan Odio, Michelle Davis, Cullen Church, and Michael Meola, led by Supervising Investigator Jen Micco of the Division of Consumer Affairs’ Office of Consumer Protection, conducted these investigations.
Deputy attorneys general from the Consumer Fraud Prosecution Section within the Division of Law represented the State in these actions.
Consumers who believe they have been cheated or scammed by a business, or suspect any other form of consumer abuse, can file a complaint online with the State Division of Consumer Affairs or by calling 1 (800) 242-5846 (toll free within New Jersey) or (973) 504-6200.