Report Unlicensed Activity

CSLB Unlicensed Contractor stingThe Contractors State License Board (CSLB) states that unlicensed contracting is part of California’s estimated annual $60 to $140 billion dollar underground economy. These individuals and businesses do not pay taxes, have general liability insurance or license surety bonds. The CSLB also believes that it is not unusual for them to be involved in other illegal activities as well.

What can you do if believe that an individual or business is contracting without a license? And can I report unlicensed activity?

File a complaint using this CSLB Advertising Complaint for Unlicensed Contractors form.

What is illegal contractor activity?

It is illegal for an unlicensed person to perform contracting work on any project valued at $500 or more in combined labor and material costs. Besides being illegal, unlicensed contractors lack accountability and have a high rate of involvement in construction scams. Unlicensed contractors are also creating unfair competition for licensed contractors who operate with bonds, insurance, and other responsible business practices.

What should you do if you know that an individual or business is using someone else’s license number illegally?

File a complaint using this CSLB Advertising Complaint for Unlicensed Contractors form.

What happens if you don’t renew you license on time?

You will be considered unlicensed until your renewal is processed. During this period you may not enter into any new contracts.

How does CSLB process complaints against unlicensed contractors?

When the Board receives a complaint against an unlicensed contractor, it may issue an administrative citation or file a criminal action with the local district attorney’s office. In some cases, it may initiate injunction proceedings against the non-licensee through the Office of the Attorney General or the district attorney.

Citation

The Registrar may issue a citation to an unlicensed contractor when there is probable cause to believe that the person is acting in the capacity of a contractor or engaging in the business of contracting without a license that is in good standing with CSLB. The citation includes an order of abatement to cease and desist and a civil penalty of up to $15,000. Unless the board receives a written appeal within fifteen (15) working days after the citation is served, the citation becomes a final order of the Registrar. The civil penalty is paid to CSLB.

If the citation is appealed, a mandatory settlement conference may be held to resolve the citation. If the matter is not settled, the appeal will be heard before an administrative law judge. The administrative law judge submits a decision to uphold, modify, or dismiss the citation. The decision is sent to the Registrar for adoption. If the cited unlicensed contractor continues to contract without a license, the Registrar may refer the case to the local district attorney for criminal action.

Criminal Action

CSLB may refer investigations to the local prosecutor to file criminal charges. If criminal charges are filed, the unlicensed contractor appears in local court, which renders a final decision on the case. The court may order a fine, probation, restitution, a jail sentence, or all of these.

Injunction

The Registrar may apply for an injunction with the superior court of either the county in which an alleged practice or transaction took place or the county in which the unlicensed person maintains a business or residence. An injunction restrains an unlicensed person from acting in the capacity or engaging in the business of contracting without a license that is in good standing with CSLB.

If you are unlicensed and need help with your application or you need study materials, the License Guru is here to help.

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CSLB Spring 2015 Newsletter

The CSLB Spring 2015 Newsletter was sent out today.

Here are my highlights… or lowlights.

CSLBs Illegal Critical ClassificationsIn the Chair’s opening statement he said: “You can expect CSLB to continue its vigorous regulation of California’s construction industry, and to aggressively pursue unlicensed contractors and unscrupulous businesses through sting operations, construction site sweeps, and other strategies. We want to build more partnerships with licensees, industry groups, and government agencies to present a united front against individuals and businesses who try to hide from state laws or take advantage of consumers.”

Once again, they’re missing the bigger picture. Cause and effect, if you will. “…vigorous regulation of California’s construction industry, and to aggressively pursue unlicensed contractors…” The Contractors State License Board is playing a HUGE part in creating the large amount of unlicensed contractors with their “vigorous regulations.”

For over two years now they have been putting applicants through the wringer with their “profiling” of specific applications. They continue to quote the regulation that requires them to perform a secondary review of at least three percent of all apps received. What I’m hoping/praying will happen is that the State Legislature or an attorney will finally call the CSLB to the mat on this.

They are not randomly selecting applications as the law states, they specifically profiling and targeting these classifications. Last week I was told by a CSLB employee that they should no longer use the term “critical classifications.” I guess they realized that using this term was illegal. DUH!!! They can’t just decide on the whim of a single power hungry CSLB employee to profile specific individuals.

That’s all for now. More later.

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Lesson Not Learned for Repeat Offenders in CSLB Sting

Lesson Not Learned for Repeat Offenders Caught in CSLB Sting Operations.

Cited for illegal contracting in Chino, Lake Elsinore were cited previously, disregarded fines.

CSLB Undercover StingSACRAMENTO  –  One of the goals of the undercover sting operations conducted by the Contractors State License Board (CSLB) is to convince those caught for illegal contracting that they’re far better off getting their license and working as a legitimate contractor.

But, as a pair of Inland Empire stings showed last week, that message just doesn’t sink in for some.

Of the 13 persons cited April 24 on illegal contracting charges at stings in Chino and Lake Elsinore, three were repeat offenders, including one who had a $5,000 warrant hanging over his head for failing to appear in court on a previous contracting violation. Seven suspects who came to the Chino sting were issued Notices To Appear (NTA) in San Bernardino Superior Court; six from the Lake Elsinore sting have Riverside County Superior Court dates.

The suspect with the $5,000 warrant, Lazaro A. Garcia, of Riverside, is a very familiar figure to CSLB investigators. An unlicensed painter who operates under the business name “Professional Home Repairs,” Garcia has been issued three previous NTAs for misdemeanor charges related to illegal contracting, and has been cited twice by CSLB on administrative violations.

Twelve of the 13 suspects, including the previous offenders, received misdemeanor citations for contracting without a license (Business and Professions Code section 7028). First-conviction penalties for contracting without a license include up to six months in jail and/or up to $5,000 in fines. Penalties escalate with successive violations.

In addition, 12 of the 13 were cited on a misdemeanor charge of illegal advertising (Business and Professions Code section 7027.1). State law requires contractors to place their license number in all print, broadcast, and online advertisements. Those without a license can advertise for jobs valued at less than $500, but the ad must state that they are not a licensed contractor.

“We try to bring unlicensed contractors over to the legal side. We even give those caught in our stings an application to apply for a license,” CSLB Registrar Steve Sands said. “But we won’t tolerate these chronic offenders who think they can sidestep the law and endanger the public.”

My thoughts…

Steve Sands says they “try to bring unlicensed contractors over to the legal side”? What he doesn’t mention is that if those cited in a sting were to apply, the CSLB licensing investigation posse will put that applicant through the wringer. They will ask for everything to be documented…. in triplicate. That applicant will already have a huge red flag next to his name.

My feeling is, if a guy is contracting without a license, I doubt he’s keeping complete and accurate records. I also feel that unlicensed guy knows he’d get pulled through the wringer and has no way of “proving” his experience. Maybe that’s why these unlicensed contractors aren’t taking good ol’ Steve up on his generous offer to join the flock.

And it does appear as though the CSLB tolerates it if they are citing the same unlicensed contractors repeatedly. If the slap on the hand doesn’t hurt, the bad kid is going to continue doing bad stuff. Wake up SWIFT/CSLB, your stings are ineffective!

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New “Handyman License” issued by the Contractors State License Board!

That is what I would like to see on the CSLB’s web page. New Handyman License Issued!

Think about it, the current law permits “unlicensed contractors” the ability to perform jobs that are $500 or less for labor and materials.

By law, they have to advertise as “unlicensed contractors.” But, by law, they don’t have to have a written contract for the work they do.

Now the CSLB is asking these “unlicensed contractors” for copies of contracts when they apply for a contractor’s license, but the law does not require them to have contracts. That makes no sense, so let’s file this under “Things that make you go… Hmmmm.”

handyman license

 

My suggestion is that they institute a handyman license. This license will allow people the ability to do work at the current $500 limit (or, perhaps, they should increase it to $1000), and the experience will be more easily documented. The CSLB could require that they have a written contract, and when it comes time to apply for a full-fledged contractor’s license, they’ll have the documentation to prove their experience.

Here are the Pros:

  1. The CSLB could increase their revenues by collecting licensing fees, renewal fees, etc.
  2. The CSLB could possibly eliminate a lot of the unlicensed activity that they currently spend countless man hours and resources trying to eliminate.
  3. The CSLB would make it easier on the applicant to provide the necessary work experience when the handyman applies for a full license.
  4. The CSLB would make it easier on the application technicians who process these applications.
  5. The CSLB could require the handyman license to carry a, let’s say, $5,000 bond. This would protect consumers, which is the mandate of the CSLB after all.
  6. I’m sure there are more that I can’t think of at this moment.

Here are the Cons:

  1. I can’t think of a single con.

Who benefits?

  1. The CSLB
  2. The consumer
  3. The licensee
  4. The surety companies
  5. The CSLB Staff
  6. Those of us in the licensing industry!

handyman license

 

I realize this would take legislation to institute, and the CSLB would have to draft the legislation and get it sponsored by a legislator. So I have no delusions of this happening any time soon, especially when it makes a great deal of sense. But a handyman license would go a long way to fixing some of the issues that currently plague the construction industry.

 

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