Most contractor fraud convictions involve locals | #phishing | #scams


The destruction from Hurricane Ida has licensed contractors in high demand throughout southeast Louisiana, as well as in the southwestern corner of the state where the recovery continues from last year’s major storms.Homeowners, such as Hazene Demin in LaPlace, find themselves in a predicament. They can wait weeks — maybe months — for a qualified local contractor to handle their repair work or roll the dice with a transient construction crew that might not still be around if something goes wrong. “I got four or five (estimates) from Houston (contractors). Their prices are cheap, and they can start as soon as possible,” said Demin, who lives with his wife and two young daughters in a travel trailer parked in his driveway. His home needs roof work, and the interior has been gutted where floodwater ruined flooring and wallboard. Out-of-state contractors can obtain licenses to work in Louisiana, and many do so year-round according to Brad Hassert, compliance director for the state board that issues contractor licenses. Most are reputable and have helped meet the storm-driven demand for repairs, he said.”The out-of-state guys get a bad rap. Some of that is indeed deserved, and they’ve earned all that,” Hassert said. “But it’s our own citizens that sometime take advantage of their neighbors as well.”WDSU Investigates reached out to local district attorneys to see how often they have used a state law approved in 2016 that made contractor fraud illegal. Before then, the offense was prosecuted under broader theft laws. The new statute allows prosecutors and law enforcement to go after anyone who poses as a contractor to accept work they’re not licensed to perform as well as scammers who take money without doing the work.Records from the Jefferson Parish district attorney show prosecutors there have handled 29 contractor fraud cases since 2015. There were guilty pleas in 16 of those cases, with four defendants accepting a lesser theft charge and another admitting to the exploitation of the infirmed. Only one contractor fraud case has gone to trial in Jefferson Parish, and the defendant was convicted by a jury. One case was expunged, and another defendant had his charge dismissed after completing a diversion program. Ten contractor fraud cases remain open in Jefferson Parish. Jefferson DA Paul Connick’s office declined an interview request for this story.WDSU researched Jefferson Parish court records in 28 recent contractor theft and fraud prosecutions and found that the defendant in every case was from southeast Louisiana. Eighteen were from Jefferson Parish.Warren Montgomery, district attorney for St. Tammany and Washington parishes, said the same trend of local defendants holds true in his jurisdiction, but he explained why out-of-towners are seldom held accountable.”Many of these contractor fraud cases that are out of state are actually never even brought to my office to be prosecuted because we can’t find them,” Montgomery told WDSU.There have been 14 contractor fraud cases in St. Tammany and Washington since 2019, according to information from Montgomery’s staff. Half of those are still awaiting trial, and there have been three guilty verdicts in the past three years.WDSU also requested a recap of recent contractor fraud cases from the Orleans Parish district attorney’s office. No information was provided. Hassert, with the state licensing board, said there is still a learning curve for some law enforcement agencies when it comes to investigating contractor fraud cases. He attributes the relative lack of prosecutions to the need for more police investigators to familiarize themselves with the industry. “Contracting is not necessarily extremely complicated, but it is a little bit technical,” Hassert said.The Louisiana State Licensing Board for Contractors is not staffed or authorized to serve as “contractor police,” Hassert said, adding that they can and do provide the evidence authorities need for investigations and prosecutions.Louisiana law gives judges discretion in sentencing contractor fraud offenders, something Montgomery said state legislators should consider changing if they want to create a more effective deterrent.He cited two recent convictions from his office as examples. In February, Danielle Gaspard pleaded guilty to two counts of contractor fraud for scamming homeowners through a Mandeville interior decorating business. Her record included seven prior convictions, and she was sentenced to 30 years in prison.Christopher Waguespack admitted guilt last year in a contractor fraud case. He had five previous convictions on a variety of charges going back to the 1980s. The judge in that case suspended his 10-year prison sentence and placed him on probation. “There’s a lot of freedom, so to speak, for the judge and sentencing. Maybe an improvement of the statute would be to take away some of that freedom,” Montgomery said.Back in LaPlace, Demin said he is leaning toward working with a local, licensed and insured contractor for his home repairs even if it means his family will stay in the travel trailer for another month or so.”But it goes back to how much I’m going to pay and how much the insurance will pay,” Demin said.Officials say the best proactive approach to thwarting contractor fraud is educating the public on the steps they should take to avoid becoming a victim. Their top recommendations:Get it in writing: “Contract” is the root of the contractor, and everyone in the business should be willing to give a customer details of the work they will perform and the specific cost for that work in writing. A savvy homeowner should ensure that the price quoted covers materials as well as labor, and the contract should also include how long the job will take to complete to ensure that the agreed-upon timeframe is fair to both parties. Don’t pay cash: Experts recommend using a check to pay contractors, offering a way to claw back payment if the work isn’t done or done incorrectly. Be wary of anyone who demands substantial cash down payment, or a contractor who says they need money immediately in order to pay their work crew. Both should be huge red flags for homeowners.Take pictures: Use your phone to get photos before, during and after the repair work just in case you need to challenge your contractor. If a dispute arises, you will have more than just your word against theirs.Background research: The state licensing board has a website, LAContractor.org, where consumers can confirm whether a contractor holds an active state license. There’s also a record of whether the contractor has been sanctioned or fined. It’s also recommended that you ask your contractor for proof of insurance, but don’t simply accept that paperwork at face value. Call the insurance company to make sure the policy is current.

The destruction from Hurricane Ida has licensed contractors in high demand throughout southeast Louisiana, as well as in the southwestern corner of the state where the recovery continues from last year’s major storms.

Homeowners, such as Hazene Demin in LaPlace, find themselves in a predicament. They can wait weeks — maybe months — for a qualified local contractor to handle their repair work or roll the dice with a transient construction crew that might not still be around if something goes wrong.

“I got four or five (estimates) from Houston (contractors). Their prices are cheap, and they can start as soon as possible,” said Demin, who lives with his wife and two young daughters in a travel trailer parked in his driveway. His home needs roof work, and the interior has been gutted where floodwater ruined flooring and wallboard.

Out-of-state contractors can obtain licenses to work in Louisiana, and many do so year-round according to Brad Hassert, compliance director for the state board that issues contractor licenses. Most are reputable and have helped meet the storm-driven demand for repairs, he said.

“The out-of-state guys get a bad rap. Some of that is indeed deserved, and they’ve earned all that,” Hassert said. “But it’s our own citizens that sometime take advantage of their neighbors as well.”

WDSU Investigates reached out to local district attorneys to see how often they have used a state law approved in 2016 that made contractor fraud illegal. Before then, the offense was prosecuted under broader theft laws. The new statute allows prosecutors and law enforcement to go after anyone who poses as a contractor to accept work they’re not licensed to perform as well as scammers who take money without doing the work.

Records from the Jefferson Parish district attorney show prosecutors there have handled 29 contractor fraud cases since 2015. There were guilty pleas in 16 of those cases, with four defendants accepting a lesser theft charge and another admitting to the exploitation of the infirmed.

Only one contractor fraud case has gone to trial in Jefferson Parish, and the defendant was convicted by a jury. One case was expunged, and another defendant had his charge dismissed after completing a diversion program. Ten contractor fraud cases remain open in Jefferson Parish.

Jefferson DA Paul Connick’s office declined an interview request for this story.

WDSU researched Jefferson Parish court records in 28 recent contractor theft and fraud prosecutions and found that the defendant in every case was from southeast Louisiana. Eighteen were from Jefferson Parish.

Warren Montgomery, district attorney for St. Tammany and Washington parishes, said the same trend of local defendants holds true in his jurisdiction, but he explained why out-of-towners are seldom held accountable.

“Many of these contractor fraud cases that are out of state are actually never even brought to my office to be prosecuted because we can’t find them,” Montgomery told WDSU.

There have been 14 contractor fraud cases in St. Tammany and Washington since 2019, according to information from Montgomery’s staff. Half of those are still awaiting trial, and there have been three guilty verdicts in the past three years.

WDSU also requested a recap of recent contractor fraud cases from the Orleans Parish district attorney’s office. No information was provided.

Hassert, with the state licensing board, said there is still a learning curve for some law enforcement agencies when it comes to investigating contractor fraud cases. He attributes the relative lack of prosecutions to the need for more police investigators to familiarize themselves with the industry.

“Contracting is not necessarily extremely complicated, but it is a little bit technical,” Hassert said.

The Louisiana State Licensing Board for Contractors is not staffed or authorized to serve as “contractor police,” Hassert said, adding that they can and do provide the evidence authorities need for investigations and prosecutions.

Louisiana law gives judges discretion in sentencing contractor fraud offenders, something Montgomery said state legislators should consider changing if they want to create a more effective deterrent.

He cited two recent convictions from his office as examples. In February, Danielle Gaspard pleaded guilty to two counts of contractor fraud for scamming homeowners through a Mandeville interior decorating business. Her record included seven prior convictions, and she was sentenced to 30 years in prison.

Christopher Waguespack admitted guilt last year in a contractor fraud case. He had five previous convictions on a variety of charges going back to the 1980s. The judge in that case suspended his 10-year prison sentence and placed him on probation.

“There’s a lot of freedom, so to speak, for the judge and sentencing. Maybe an improvement of the statute would be to take away some of that freedom,” Montgomery said.

Back in LaPlace, Demin said he is leaning toward working with a local, licensed and insured contractor for his home repairs even if it means his family will stay in the travel trailer for another month or so.

“But it goes back to how much I’m going to pay and how much the insurance will pay,” Demin said.

Officials say the best proactive approach to thwarting contractor fraud is educating the public on the steps they should take to avoid becoming a victim. Their top recommendations:

  1. Get it in writing: “Contract” is the root of the contractor, and everyone in the business should be willing to give a customer details of the work they will perform and the specific cost for that work in writing. A savvy homeowner should ensure that the price quoted covers materials as well as labor, and the contract should also include how long the job will take to complete to ensure that the agreed-upon timeframe is fair to both parties.
  2. Don’t pay cash: Experts recommend using a check to pay contractors, offering a way to claw back payment if the work isn’t done or done incorrectly. Be wary of anyone who demands substantial cash down payment, or a contractor who says they need money immediately in order to pay their work crew. Both should be huge red flags for homeowners.
  3. Take pictures: Use your phone to get photos before, during and after the repair work just in case you need to challenge your contractor. If a dispute arises, you will have more than just your word against theirs.
  4. Background research: The state licensing board has a website, LAContractor.org, where consumers can confirm whether a contractor holds an active state license. There’s also a record of whether the contractor has been sanctioned or fined. It’s also recommended that you ask your contractor for proof of insurance, but don’t simply accept that paperwork at face value. Call the insurance company to make sure the policy is current.



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