The trap was set with an enticing bait, but in the end it proved to be poison for 19 unsuspecting contractors operating without a license.
The Contractor’s State Licensing Board Statewide Investigative Fraud Team (SWIFT) set up the sting operation at a Monterey home near the Monterey Bay Aquarium June 14-15.
Investigators posing as the homeowners contacted the contractors through Craigslist ads, social media sites and flyers or business cards found at building supply stores.
The investigators solicited bids for everything from fencing, painting, tree trimming, roofing, electrical and plumbing jobs. Some bids were as high as $13,000—well over the legal limit of $500, encompassing labor and materials—for anyone offering services without a contractor’s license.
All 19 suspects caught during the two-day sting were issued misdemeanor citations for working as contractors without a license. Penalties for first-time convictions include up to six months in jail and/or up to $5,000 in fines.
The suspects came from cities all over Monterey County, including Salinas, Seaside, Monterey, Pacific Grove, Prunedale and Greenfield. One contractor came from Aptos.
Eighteen of the suspects were cited for illegal advertising, since the law requires them to state in all advertising they are not licensed. They must also advertise for jobs less than $500. Two were also cited for not having workers comp insurance for anyone working with them.
SWIFT conducts sting operations regularly all over the state, using homes offered by homeowners interested in assisting the board in catching unlicensed contractors, according to a licensing board spokesperson.
A sting in Seaside in 2010 as part of a statewide crackdown nabbed nine unlicensed contractors, and in 2013 investigators arrested three men, including one who was a convicted sex offender previously cited for unlicensed activity.
Local law enforcement and representatives from the county District Attorney’s office are on hand during the operations, hiding in a room or garage within earshot of the exchange between investigators and contractors. Suspects are patted down for weapons, handcuffed, and checked for warrants.
During the Monterey sting, one man, Roberto Carlos Argueta of Seaside, admitted to possessing cocaine and was taken into custody. He was also cited for contracting without a license, illegal advertising and no workers comp insurance.
Argueta, who advertised himself as a painting and decorating contractor, was also cited for soliciting an excessive down payment. The law limits down payments to 10 percent of the contract price or $1,000, whichever is less.
All 19 suspects have been ordered to appear in Monterey County Superior Court on Sept. 6.
“Consumers who hire and allow unlicensed workers into their homes or businesses take unnecessary personal and financial risks,” CSLB Registrar David Fogt said in a statement.
He pointed out that licensed contractors not only pass trade and law exams, they also pass criminal background checks.
The State Licensing Board estimates that unlicensed contracting constitutes an underground economy between $60 billion and $140 billion a year, according to the agency’s website.
In 2015-16 the agency, which is part of the California Department of Consumer Affairs, helped recover about $41 million in ordered restitution for consumers who were on the receiving end of failed contracting jobs.
There are approximately 290,000 licensed contractors in California regulated by the licensing board.