Business Talk: Ripped off
Protect yourself from fraudulent tradesmen, contractors
By Anthony Lombardi
As chiropractic health professionals we are very educated and we know how to differentiate things like a sacroiliac dysfunction from a disc injury – but very few of us know how to differentiate a con from a contractor.
Unfortunately, I learned this the hard way when I was defrauded during a home renovation. Thankfully, I’m now able to pass this information to you.
I was one of the lucky ones though. I was able to press charges against the offending party and collect some restitution. But as we tell our patients, the best way to solve a problem is to prevent it. I hope this piece provides you with some insight on how not to get ripped off.
Do your homework
It is important to do your own research before meeting contractors or tradesmen for a quote. In total, these steps take about 10 minutes but could save you thousands of dollars in the long run.
Check for bankruptcy. Call the Office of Superintendent of Bankruptcy (OSB) to see if the company is under bankruptcy protection. The phone number is 613-952-1133. If a company is under bankruptcy protection it is obligated to tell you or it could face federal charges. Also, bankrupt contractors cannot ask you for anything more than $1000 up front under their protection terms with the OSB.
Most professional contractors have their expenses come out of a bank-approved line of credit so that they do not have cash flow problems. So, if a contractor is asking you for an incredible sum of money up front, it’s likely because they cannot obtain financing due to bad credit, bankruptcy or both.
Check online. Check the company for any online reviews on Google, Houzz, TrustedPros and/or Facebook – but do not always trust these reviews. Con artists will stage reviews so they appear to have an impeccable reputation. Be wary of a total averages of five out of five stars on their reviews as even the best companies sometimes have unhappy customers.
It’s important to read the unhappy reviews and see if the company made a response. Reputable companies will confront their bad reviews with appropriate responses designed to help their client and improve their own product.
Know your rights
Under the Consumer Protection Act (CPA), you must get a written contract for transactions that cost more than
- you hire a business or individual, like a general contractor, mover or snow removal services;
- you purchase any product or service at home from a door-to-door salesperson;
- you sign up for a membership (e.g. from a fitness club or buying club).
If the contract is signed in your home you have a ‘cooling-off’ period of 10 to 14 days (depending on the service) to change your mind and void the contract without penalty. Consult the CPA website for more details.
The contract must contain all the details of the purchase and any credit terms you’ve agreed to. Always remember to read and understand the terms and conditions before signing.
The final price cannot be more than 10 per cent above the estimate unless you agree to a new price and sign a change to the contract. If you are charged more than 10 per cent above a written estimate without agreeing to it, you can demand that the final price be adjusted.
Make sure the contract contains a timeline and end date of when work will be completed. Under the Consumer Protection Act, when you order a product or service, it must be delivered within 30 days of the promised delivery date or you can ask for a refund. Under the CPA, you cannot be charged for receiving an item or service that you did
What contractors must provide: licences, accreditation or certification, and WSIB insurances needed to start and finish the work; references of their work upon request – although be aware that some cons stage good references to make a sale; proof of all necessary permits required before proceeding. When dealing with electricians make sure to call the Electrical Safety Authority to see if they are licensed in your province.
- Never give more than 10 per cent upfront and the rest only upon completion, and never pay the full amount of the contract before the work is all done. Remember, legitimate home renovation companies have enough credit to buy the materials they need to start and finish the job.
- Set, review, and adhere to timelines of the work to be done. Remember if the work is not completed within 30 days of the due date then the contract is void if a revised contract is not agreed upon.
- If you are ‘ripped off’ go to the local police and report the crime as a fraud. Frauds command more serious attention and investigation. If police are not taking your complaint seriously then ask to speak to the staff sergeant on duty to accelerate the wheels of justice.
- If the person you hired is under bankruptcy protection but took greater than $1,000 from you as down payment, you can contact the RCMP as it is a federal crime.
- In addition to all of this you may file a complaint with the Ministry of Government and Consumer Services Misrepresentation: 1-877-376-9902. It is illegal for businesses or individuals to give you false information about themselves or the product/service they offer.
- If law enforcement gets involved and presses charges, one option at recouping the lost monies is by ordered restitution where the judge orders the defendant to pay you to avoid a more serious sentence. Alternatively, you may also proceed with a civil case through small claims court to sue for the return of what was taken from you.
Dr. Anthony Lombardi, DC, is consultant to athletes in the NFL, CFL and NHL, and founder of the Hamilton Back Clinic in Hamilton, Ont. He teaches his fundamental EXSTORE Assessment System and conducts practice-building workshops to health professionals. Visit exstore.ca for information.