@@no-one-qd1li Then send them to prison. Right? We need a bigger gov to handle contractor prisons. I am sure we can find some contractors to build it.... wait....
@davidbeppler3032 .....so your stupid or just dramatic 🙄 I was referring to con artist and scammers never did I refer to the mentioned of prison. R E T A R D
@davidbeppler3032 ....you clearly lack reading comprehension .....I was referring to con artist and scammers... nothing I said fits as a reference to the mentioned prison. Room temperature IQ at best
The state needs to seize his assets and those of his father and brother. They used the money for upgrades to their own houses, new cars and a podcast scheme.
@@samhavoc1066 Not if company funds were used for personal gain. Once that corporate veil is pierced, it doesn't really matter how limited they believe their liability is. If the fraudulent withdrawals were done by or at the direction of an individual they could be directly and criminally liable as well.
We do a %60 up front, %30 when the rest of the equipment is delivered on site and the remaining %10 upon completion (for reference we're a Arizona Low voltage AV integrator / automation company)
Nope. Simply declares bankruptcy, then opens a new company under a different name. Creating a Limited Liability Corporation (LLC) means the liability dies with the company. This guy knows exactly what he was doing.
@@samhavoc1066 When you have your license revoked at the contractors board it is hard to get back. He can open an LLC but with no CL license. They won't give it to him.
People need to start killing people. If all of the customers got together in a large group of hundreds of people. And killed Colton. The government would not be able to do anything about it.
If you're paying over $300,000 to build a damn lousy ADU, you done lost your damn mind even before finding out you've been scammed months down the road into ground breaking.
Just FYI, under California law contractors can’t ask for more that $1000 or 10% whichever is lowest for a deposit. They are also required to give a payment schedule and customers don’t have to pay until work is done. Dont ever pay in full upfront.
Its illegal to take a down payment of more than 1000, they should have never been asked to "prepay" for the whole thing, the owner of the company needs to be in jail, period. He's broken so many rules set by the CSLB.
@@davidbeppler3032 It depends, what if the contractor has to buy stuff that cost $10K. What if it is lengthy construction process ? I do agree that these people made mistakes of over paying them may be. I pay contractors on installments.
My heart goes out to these people. Having been in the industry for several years, there is no reason what-so-ever for this to happen. Only way this can happen is from the builder himself stealing money from his own business and not accounting for it. Financing a build is usually a payout in 3 installments as the build progresses to the contractor showing proof of of the build itself. Colton is a scammer and knew exactly what he was doing. Too bad I'm retired...would love to help some of these people out
Welcome to California. Home builders are required to have a $25k bond? When you do business with anyone, best to know what you're doing. I would insist on using an escrow account. If the builder doesn't want that. There's your sign to find another builder.
@MrShanester117 policy worth 35k! you have never had a car, huh? I also drive a corvette C7, which is 2200 a year for that 35k policy. I think you are flying straight now, right ✅️ 🤔
The guy is a crook, but no one should pay for work in advance, that's on them for being that naive. You pay an opening percentage, then the remaining in increments as it is completed, with a final payment when complete.
This structure of a bond makes no sense. Theoretically, you want the contractor to have as much money in bond as they have current business. They are doing so that if they do go belly up, all of their customers can be made whole. It’s a simple solution. If you are business is doing millions of dollars of work your bond needs to be for millions of dollars so as you tell banks, your business is getting bigger and you are earning more income you should have to show proof of your newly increased bond.
The easy fix is to agree upon a written payment schedule cl, pay a percentage for work completed per milestone or when they get inspections passed to the next phase .
Most contractors have top quality tools, and trucks. While using the cheapest building materials, cutting corners, and making excuses for everything built today.
If you raise the bond requirements, the cost to build a home will go up too. Don’t pay that much upfront, but pay as things get completed. They not suppose to take more then 10% or 1000 usd up front, whatever is less.
@@gund89123because they make the laws that allow this behavior!!! Like allowing squatters to take over peoples homes. Criminals being released over and over. Allowing criminals to steal with no repercussions. Shame on you for blaming these people. You are part of the problem and probably vote as a democrat.
The guy that got scammed said and I quote "I was relieved to find out I wasn't the only one that got scammed". 😂😂😂😂 Hey, whatever helps you sleep at night.
Well, it's embarrassing to get scammed. So to know that you aren't the only one to get scammed by that same company makes you feel a little less lonely and sometimes feel less stupid about yourself. More and more scammers are becoming better at portraying legit companies as technology gets more advanced. And with rising costs of everything, you will have more people falling for those that offer cheaper deals.
The state's laughable bond requirement works for small operators working in good faith. No major competently administered commercial contract runs under such skimpy bond protection. State law also prohibits deposits over 1000.00 or front loading contracts so that the builder is billing over the value of the work performed. If these rules were strictly enforced, the ridiculously low bond requirement would be less of a problem. It seems here that the company did not properly handle cash flow, relied on creditors to fund operations with loans secured against personal assets, and failed to pay subcontractors.
paying full price upfront for a build that has not happened yet ......thats a scam period. even the car mechanic doesn't charge until your car is fixed.
You're referring to a "proportional bond" or "variable bond," which is a type of surety bond that adjusts its coverage amount based on the potential liability. This means that the bond's coverage limit changes in proportion to the level of risk or exposure. Proportional bonds are often used in situations where the potential liability may fluctuate over time, such as in construction projects or contracts with varying scopes of work. The bond's coverage amount may increase or decrease as the project's value or risk level changes.
As a contractor myself, let me explain. $15k for sole proprietorship and $25k for LLC. The LLC part is important. While the bond is small scammers can only do these things due to LLC rules. If the LLC folds then the customer can't go against the contractor. That is the purpose of an LLC. Raising the bond rate wouldn't do much as this LLC could have hundreds of customers fighting over it. The only thing you can do is keep it business. Do you background research on the contractor and really get a feel for them. Anyone who comes over as a slime ball salesman isn't to be trusted.
Bond is not the issue don't raise it on all 50+ trades over human error. People must perform due diligence. State law prohibits contractors from accepting over 10% or $1,000 deposit. Buyers beware if they take more.
@@keepitclean1237 of course, it is, but at the end of the day it is fueled by greed, building ADU faster, and getting income faster, and people lose the guards.
All of CA is 25k it's up 66 percent from prior year. What people need to pay attention to is the down payment 10% or $1000 bucks. They just gave him an extra 199k 🫣
@@redbloodedbutterfly Except you are able to pay in increments as the work is completed. These buyers paid nearly the full amount up front, if not the actual full amount. This was truly a naïve choice. There is a reason it is good practice to NOT pay anymore than is required and you should do your own due diligence to know if the builder is asking for too much up front.
Company rakes in tens of millions in dollars and then suddenly files for bankrupcy, CEO and his family walks away with tens of millions without legal consequence. Just opens the door for more scammers like them to do the same if the law doesn't change.
You can request a project specific bond from a contractor. Contractors are not allowed to request a down payment of more than 10% of the project cost or $1,000 whichever is LESS. You as a customer need to monitor the project and not pay for more than what is installed . You also need to be sure to require lien waivers from the contractor for the subs to ensure that they are being paid. This information is required to be included in the contract document for the consumer to see. So you have to be responsible for yourself to a large degree.
Why prepay 100% 😢 Never! PS I needed some emergency roofing work done last year. The guys at the breakfast table next to me told me they were roofers and I should give them a call. They gave me an astronomical quote. When I went to research them, I couldn't find any Company property. The professional licenses were not for roofing. One was for hazmat. 😮 The address was an apartment.
A much higher bond will likely reduce the amount of general contractors available in CA, people will have to pay more for works because of less competition.
Or more legitimate businessmen will step into the void they leave. If there’s not a significant ratio of money in the bond, compared to the amount invested by the consumers, this problem isn’t likely to just go away. They’ve (scammers) established that this is a cash grab and without some legal remedy it’s an open invitation to prey on the unsuspecting.
@@DaveP-uv1ml Rasing it will effect all 50+ trades we already have a shortage this would potentially be the nail in the coffin for smaller earning trades. More government isn't the answer people need to read up.
@@DaveP-uv1ml Operate a business in California is much harder than other states. California is already have a great shortage of contractors and builders, otherwise why would many people chose the prepay for ADU with this questionable builder in the first place. The truth is: more you regulate, the more likely price will increase or contractors have to cut corners and become fraud. Have any builder under current California laws chose to build true affordable single house?
This has always been the case, it is Buyer Beware when it comes to builders, you never give them access to your bank accounts, you pay in draws after the work is completed and inspected, you never give large up front deposits, the reasons for this are hard learned lessons. Builders can grab the money, and run, or just go bankrupt leaving you with nothing. One can not over look that these home owners had a responsibility to protect themselves, and they did so very badly, there were alarm bells all over this builders actions, they just were not paying attention.
Sorry but these homeowners are part to blame. You don't have to be a rocket scientist to figure out how to address work progress payments. It's pretty simple.
Yes, You never ever hand over all the money at the front. I normally do three splits. If it's a project that has a lot of material costs then maybe 50% up front to buy the stuff but that other half comes when things are complete
All the "ADU experts" were backing this company and anytime someone would share some criticism they'd be labeled a hater. These homeowners should file a case against the people that recommended this company and this owner should be in prison for fraud.
We bought in 2021, we got an extremely poorly built tiny house. Sued but nothing happened. Lawsuit is still active but Colton and his lawyer refuse to show. Seize all assets, homes, cars, boats, dogs and anything else he and his father have and split up between those scammed. Why is it people like this are allowed to just walk away.Lock him and his father up.
There’s a difference between a license bond and a performance bond. The best protection, considering the disconnect with the state, is to require a performance bond before signing a contract. That’s a bond that assures the completion of a contracted project. However most small contractors would probably bulk at the demand. Contract law is something of a hodgepodge with sometimes strict and sometimes lax enforcement. There are several violations of contract law in these cases. Asking for an excessive down payment is one of them. I believe the law limits a down payment to 10% of the total and limits progress payments to amount equal to the progress demonstrated. There are several legal avenues the state could follow if they would.
A true misunderstanding of information. The contractors license bond is for the State of California to have enough money to sue the contractor to put him out of business for violation the contractors license law. That’s all it’s there for. It’s not for the customer. If you want a bond to assure the completion of your project you have to ask and pay the contractor for that surety.
totally! I’m currently in court with one of the bond companies for a contractor. Unfinished projects are not protected!!! A total scam! and the 1st judge who sit on my case supported the contractor’s bond and assumed it’s fine to not pass city inspection and the contractor doesn’t have to pass city inspection. My project is basically half way through. The judge says she is not into contractor’s not passing city inspection..
Just lost the court case where I experienced illegal subcontracting, refused to pass inspection and refused to provide invoice. Jusge ruled a “plaintiff to take nothing” order and it’s a case where contractor went to my property and trespassed to cut off my hvac system to extort payment. It’s impossible to fight against the surety bond since they are the professional scammers.
Make the contractor post a performance bond or get course of completion insurance before works begins. Also retain 50% of the contract value of the scope of work to guarantee work is completed otherwise you lose control. Finally pay in increments as stages of work are completed. For added protection, don't hire a contractor who is doing business as a corporation, since their personal assets cant be taken in a lawsuit...dont forget the initial down payment per california law is 10% or $1,000 whichever is less
Bond amount should a sizable set percentage of the total of all quarterly invoices. If that can’t be implemented then bonding amount and percentage of coverage per customer should be front and center of all transactions.
Has a small business owner, I agree but at the same time it adds to another cost if the Bond is raise then the cost is pass on to me, between the bond, insurance, workers comp then taxes it strained me and other small business. Sometimes I feel like giving up and working a 8 to 5.
People complaining about why the government needs to implement laws to protect the general public. Well this is a prime example of companies screwing people over
Forget the bond, Contractor Law says the Contractor cannot take any more than 10% of contract amount or $1,000 , whichever is less. Their contract is supposed to explain this as well. The Contractor should be in big Civil trouble for this and the State should be all over them. This should be treated as a felony. The homeowner should know better than to give so much up front as well.
Not just ADU, any contractor can leave customers high & dry. The state is not at fault, other than to do a better job informing the public of the coverage & payout of a bond. To provide ways to easily see the bond amount. Because we need housing and cost to work and build here is high, not sure much else will really be done. Sadly this means, it might be better to ignore a new biz and go with a biz with a long track record of finished projects. Yes prosecute and claw back assets. Do not approve Bankruptcy for this guy and his company.
The bond isn't really for that, even if the law technically allows for collecting on bankruptcy. The bond is Iike a pre insurance claim, for mishaps, accidents that caused damage to property or faulty work. It's not for a business lying and not finishing the work. For that you'd have to file a civil suit.
An informed buyer follows the industry standard, and demands that the bidding contractors include the cost of an individual project performance bond, which bond meets or exceeds the total cost of the project. The government is not your babysitter .
As a CA licensed contractor since 1976, I’ve seen a lot. In these Tiny Homes cases, it looks like the CSLB requirement that a contractor is to not receive more from a client than they’ve delivered in services has been violated hugely. If the CSLB is desirous of mitigating these situations, they should require “completion bonds” for projects that exceed a certain amount, so those who do smaller projects aren’t asked to have huge licensing bond requirements put on them. Completion bonds aren’t a “perfect solution” to the problem, but would make far less harmful situations than this one. Bobby McGee for Bobby McGee Construction
Look into ITH, Incredible Tiny Homes in Tennessee. They make fully contained homes, and can transport them to your location. I believe they're built to code but ask about CA codes, and may even be insurable. Theyre a lot smaller than what was shown on screen though. Since theyre built on trailers with wheels. Need water and electric hookups
![[LIVE] : ONE ลุมพินี 84 วันนี้!! คู่เอก "ก้องศึก vs เมืองไทย"](http://i.ytimg.com/vi/3kuzsAIDf1c/mqdefault.jpg)
He’s a con artist & a scammer. He needs to go to prison.
I'd say most contractors are
@@no-one-qd1li Then send them to prison. Right?
We need a bigger gov to handle contractor prisons.
I am sure we can find some contractors to build it.... wait....
@@no-one-qd1liyou’re an idiot.
@davidbeppler3032 .....so your stupid or just dramatic 🙄 I was referring to con artist and scammers never did I refer to the mentioned of prison. R E T A R D
@davidbeppler3032 ....you clearly lack reading comprehension .....I was referring to con artist and scammers... nothing I said fits as a reference to the mentioned prison. Room temperature IQ at best
The state needs to seize his assets and those of his father and brother. They used the money for upgrades to their own houses, new cars and a podcast scheme.
They can't legally as the company was in an LLC. You can only sue for, or seize, the company assets.
@@samhavoc1066yup. Be smart and dont pay more than what materials cost.
The state of California has stopped prosecuting property crimes, so head on over to their house and start recouping property.
california voters wanted this.. legalize theft
@@samhavoc1066 Not if company funds were used for personal gain. Once that corporate veil is pierced, it doesn't really matter how limited they believe their liability is. If the fraudulent withdrawals were done by or at the direction of an individual they could be directly and criminally liable as well.
Putting contractors in jail for knowingly taking money when they were not going to finish the project might help.
Not exactly easy to prove in a court of law.
Follow the money. And yes criminal charges!!!
That has been our solution to every problem for forty years. We’ve got a lot of people in jail and how many problems have we solved?
Don't EVER pay a contractor more than 30% the full cost of the project up front. And NEVER set up an automatic payment.....EVER!
In CA, the down payment is $1000 or 10%, whichever is less. These people are fools.
@@MariaJuarez-oc7zq Yes they are. The bond is not a performance bond. C-10 of 20 years here.
We do a %60 up front, %30 when the rest of the equipment is delivered on site and the remaining %10 upon completion (for reference we're a Arizona Low voltage AV integrator / automation company)
@@Ethan1193 Nice. I partnered a C-7 back in the day. We did a lot of tract homes until 2008 then QUICKLY went commercial! You know why.
@@MariaJuarez-oc7zq You are right. That is the law in California. Been that for 50 years.
Put the guy who ran the scheme in jail, very clearly he’s a financial danger to the community.
That guy probably created a LLC.
He won’t be responsible for anything 😂
What next? Are we going to Donald Trump in jail for scamming people?
He knew what he was doing. He is in another country enjoying their money
Nope. Simply declares bankruptcy, then opens a new company under a different name. Creating a Limited Liability Corporation (LLC) means the liability dies with the company. This guy knows exactly what he was doing.
@@samhavoc1066 When you have your license revoked at the contractors board it is hard to get back. He can open an LLC but with no CL license. They won't give it to him.
@@samhavoc1066 Yep there's no need to flee elsewhere. What he did was perfectly legal. Not agreeing with it one bit. It's just sad we allow this.
People need to start killing people. If all of the customers got together in a large group of hundreds of people. And killed Colton. The government would not be able to do anything about it.
@@DefinitelyNotRinno need to flee? If he ripped me off he couldn’t flee fast enough. I guarantee that he’d come up with my money.
They were robbed. The business owners took draws and have all their money.
All could've been avoided with a little research.
@@keepitclean1237 captain hindsight to the rescue. Nobody asked you
@@didamnesia3575 Same lol
If you're paying over $300,000 to build a damn lousy ADU, you done lost your damn mind even before finding out you've been scammed months down the road into ground breaking.
THIS
Just FYI, under California law contractors can’t ask for more that $1000 or 10% whichever is lowest for a deposit. They are also required to give a payment schedule and customers don’t have to pay until work is done.
Dont ever pay in full upfront.
Criminals rewarded
california of course they are
Don’t file a lawsuit. Follow them home and go postal. That’s the only way to fix problems.
Spending the rest of your life in prison doesn’t fix anything
$200,000 x 400 = $80,000,000 and thats the low end of "profits" from creating a cheating business. wow
Its illegal to take a down payment of more than 1000, they should have never been asked to "prepay" for the whole thing, the owner of the company needs to be in jail, period. He's broken so many rules set by the CSLB.
What are you talking about? I install windows. When I order $10,000 of windows I am certainly going to get a down payment.
I believe its 10%
@@DuffyGabi Full or nothing. Put the money, the full amount, in Escrow and collect once the job is done and inspected. Not one second before.
@@davidbeppler3032
It depends, what if the contractor has to buy stuff that cost $10K.
What if it is lengthy construction process ?
I do agree that these people made mistakes of over paying them may be.
I pay contractors on installments.
@@gund89123,
That's why businesses, esp. such as contractors, have credit agreements with suppliers. 😋
My heart goes out to these people. Having been in the industry for several years, there is no reason what-so-ever for this to happen. Only way this can happen is from the builder himself stealing money from his own business and not accounting for it. Financing a build is usually a payout in 3 installments as the build progresses to the contractor showing proof of of the build itself. Colton is a scammer and knew exactly what he was doing. Too bad I'm retired...would love to help some of these people out
Welcome to California. Home builders are required to have a $25k bond? When you do business with anyone, best to know what you're doing. I would insist on using an escrow account. If the builder doesn't want that. There's your sign to find another builder.
@@davidbell4986 That is a very good idea
The owner of ADU looks like a scammer.
Well he was a scammer
I gotta have 35k insurance to drive my car in california.
You can afford a car?! Are you rich?
@davidbeppler3032 C7 corvette people may think I might be. But I'm homeless lol
@@obsidian1109
You’re claiming you pay 3k a month for car insurance?
@MrShanester117 policy worth 35k! you have never had a car, huh? I also drive a corvette C7, which is 2200 a year for that 35k policy. I think you are flying straight now, right ✅️ 🤔
The guy is a crook, but no one should pay for work in advance, that's on them for being that naive. You pay an opening percentage, then the remaining in increments as it is completed, with a final payment when complete.
In CA, it's 10% or $1000, whichever is less, up front.
Licensed, Bonded and Insured.... What about the insured part. Usually that part has the higher limits.
300k for that little shed size backyard home was already a massive scam. These people need to take things into their own hands.
Not in California
This structure of a bond makes no sense. Theoretically, you want the contractor to have as much money in bond as they have current business. They are doing so that if they do go belly up, all of their customers can be made whole. It’s a simple solution. If you are business is doing millions of dollars of work your bond needs to be for millions of dollars so as you tell banks, your business is getting bigger and you are earning more income you should have to show proof of your newly increased bond.
The easy fix is to agree upon a written payment schedule cl, pay a percentage for work completed per milestone or when they get inspections passed to the next phase .
Hire a general contractor that builds locally, not a business that subs out every thing.
Are we surprised that California law makers are incapable of protecting law abiding citizens and home owners?
Progress payment only. Don’t sign an upfront payment contract, with any contractor. And bonds need be project specific.
Strange how fraud becomes legal if you have a state license..should be criminal not civil.
Every payment received should partly be paid into the bond.
That sucks for the victims but more costly regulations usually means more cost for the builder which leads to more cost for the customer.
Asinine... California needs new government.
On the positive side, it is good to start a home-building business in CA.
Most contractors have top quality tools, and trucks. While using the cheapest building materials, cutting corners, and making excuses for everything built today.
The contractor is really gambling that out of 400+ scammed people, one isn't gonna snap.
From what I've read on Reddit a scammed customer has already easily found the CEO's home address. So it might only be a matter of time. 😅
It's California everyone's already crazy.
As likely as a capsized yacht off Sicily.
@@garycallihan4206too soon! 😅😂😅
@tenacietripeam-og7vc In CA it just depends on who has the best legal team and political connections.
I'm sure all the neighbors of those adu builds are thrilled those projects crapped out. They need to revert the adu laws back to the before 2021
its like they skipped all the red flags to just hand the guy money
he stole the money and sue the owner
You never pre-pay for services like this
This is surprising for heavily regulated California. Looks like it was a remodeler law passed fifty years ago based on the number.
The Bond should should state,
"Total refund to unfinished project"...
If you raise the bond requirements, the cost to build a home will go up too. Don’t pay that much upfront, but pay as things get completed. They not suppose to take more then 10% or 1000 usd up front, whatever is less.
I love California and their lawmakers.
@@ebeyslough they alll need to go. Thx
How is this lawmakers problem?
Why did these people pay before work was completed?
District Attorney has to file charges, not politician or governor.
@@gund89123 You won't get an answer from this soy pronoun. 🤣
@@gund89123because they make the laws that allow this behavior!!! Like allowing squatters to take over peoples homes. Criminals being released over and over. Allowing criminals to steal with no repercussions.
Shame on you for blaming these people. You are part of the problem and probably vote as a democrat.
This is a good example of how so many laws not just in California but around the country are out of dated.
That CEO needs to watch out
Yep, pay back will be a bitch.
The guy that got scammed said and I quote
"I was relieved to find out I wasn't the only one that got scammed". 😂😂😂😂 Hey, whatever helps you sleep at night.
Well, it's embarrassing to get scammed. So to know that you aren't the only one to get scammed by that same company makes you feel a little less lonely and sometimes feel less stupid about yourself. More and more scammers are becoming better at portraying legit companies as technology gets more advanced. And with rising costs of everything, you will have more people falling for those that offer cheaper deals.
The state's laughable bond requirement works for small operators working in good faith. No major competently administered commercial contract runs under such skimpy bond protection. State law also prohibits deposits over 1000.00 or front loading contracts so that the builder is billing over the value of the work performed. If these rules were strictly enforced, the ridiculously low bond requirement would be less of a problem. It seems here that the company did not properly handle cash flow, relied on creditors to fund operations with loans secured against personal assets, and failed to pay subcontractors.
If the rules were strictly followed but people just want to give their money away
paying full price upfront for a build that has not happened yet ......thats a scam period. even the car mechanic doesn't charge until your car is fixed.
Big or small. The only way to be safe in doing anything is doing it yourself. Dont rely on the state-corporations etc
And he’ll get away with it too!
He already has. He's working on his campaign for 2028. 🤪😂🤣
He voted for Newsome and now he is free.
@@meangene98 No.. ! 🤣🤣🤣
He has many years of litigation ahead of him
@@smoothoperator1083I can almost guarantee he’s a democrat
@@smoothoperator1083 Yep, years & years & years, meanwhile that money is disappearing beyond recovery.
You're referring to a "proportional bond" or "variable bond," which is a type of surety bond that adjusts its coverage amount based on the potential liability. This means that the bond's coverage limit changes in proportion to the level of risk or exposure.
Proportional bonds are often used in situations where the potential liability may fluctuate over time, such as in construction projects or contracts with varying scopes of work. The bond's coverage amount may increase or decrease as the project's value or risk level changes.
(ONE ONE SEVEN) JOHNSTON CT.
FOLSOM, CA 95630
Act accordingly
I say don’t ever accept a contractor’s bid unless they have both a valid license and at least a two million dollar surety bond before any work begins.
Better off buying a nice tool shed from Home Depot
Wow, just WOW. Is my state ALWAYS going to punish the Homeowners??
As a contractor myself, let me explain. $15k for sole proprietorship and $25k for LLC. The LLC part is important. While the bond is small scammers can only do these things due to LLC rules. If the LLC folds then the customer can't go against the contractor. That is the purpose of an LLC. Raising the bond rate wouldn't do much as this LLC could have hundreds of customers fighting over it.
The only thing you can do is keep it business. Do you background research on the contractor and really get a feel for them. Anyone who comes over as a slime ball salesman isn't to be trusted.
Damn…..
Put leans on the properties and assets of the company, and if their is fraud, sue the owner himself.
Virginia only requires $50K. Thank you for waking me up to how little that is, in context.
its a shame to see them smiling on video knowing they have ruined some peoples lives who trusted them
Bond is not the issue don't raise it on all 50+ trades over human error. People must perform due diligence. State law prohibits contractors from accepting over 10% or $1,000 deposit. Buyers beware if they take more.
They should get a construction loan also which pays at its being built…if the builder bails, they can switch to another builder.
they probably said we have a line of customers, if you prepay, you are getting ahead of them.
@@Maksim-lz3og Sounds like a scam right?
@@keepitclean1237 of course, it is, but at the end of the day it is fueled by greed, building ADU faster, and getting income faster, and people lose the guards.
Now people know to check the bond amount of contractors they are planning to do do business with.
All of CA is 25k it's up 66 percent from prior year. What people need to pay attention to is the down payment 10% or $1000 bucks. They just gave him an extra 199k 🫣
Sorry but paying someone before any work is done is just plain naive.
No, that's how hiring a contractor works, unfortunately. They all want a down payment before they'll schedule the work.
@@redbloodedbutterfly,
But not the entire, finished price.
@@debracisneroshhp2827 Correct. I've yet to be asked to pay more than 50% upfront. Even for the 50% people, I want to tell them to pound sand.
@@redbloodedbutterflyDown payment is 10% or $1,000 That's legal max why they decided to give him $200,000 is the real question.
@@redbloodedbutterfly Except you are able to pay in increments as the work is completed. These buyers paid nearly the full amount up front, if not the actual full amount. This was truly a naïve choice. There is a reason it is good practice to NOT pay anymore than is required and you should do your own due diligence to know if the builder is asking for too much up front.
Company rakes in tens of millions in dollars and then suddenly files for bankrupcy, CEO and his family walks away with tens of millions without legal consequence. Just opens the door for more scammers like them to do the same if the law doesn't change.
This is true in every state. Contractors do this all the time to get out of repaying customers for unfinished work. Happen to me too
Pay that much money in advance? You should be embarrassed.
You can request a project specific bond from a contractor. Contractors are not allowed to request a down payment of more than 10% of the project cost or $1,000 whichever is LESS. You as a customer need to monitor the project and not pay for more than what is installed . You also need to be sure to require lien waivers from the contractor for the subs to ensure that they are being paid. This information is required to be included in the contract document for the consumer to see. So you have to be responsible for yourself to a large degree.
This happens a lot actually. You’d be surprised
I wouldnt be surprised at all
Why prepay 100% 😢 Never! PS I needed some emergency roofing work done last year. The guys at the breakfast table next to me told me they were roofers and I should give them a call. They gave me an astronomical quote. When I went to research them, I couldn't find any Company property. The professional licenses were not for roofing. One was for hazmat. 😮 The address was an apartment.
Nice story, helpful. Especially coming from NBC. thanks.
Wow! some people suck the big one. I'm sorry for all those people.
I was worried about the businesses. Good to know they are protected.
Im my state back in the 90’s even small independent used car dealers were required to carry a minimum $50k bond.This was 25 years ago.
A much higher bond will likely reduce the amount of general contractors available in CA, people will have to pay more for works because of less competition.
Or more legitimate businessmen will step into the void they leave. If there’s not a significant ratio of money in the bond, compared to the amount invested by the consumers, this problem isn’t likely to just go away. They’ve (scammers) established that this is a cash grab and without some legal remedy it’s an open invitation to prey on the unsuspecting.
@@CuriosityQueue Ugggh people just need to read. 10% or $1,000 why are people paying full price for nothing.
@@DaveP-uv1ml Rasing it will effect all 50+ trades we already have a shortage this would potentially be the nail in the coffin for smaller earning trades. More government isn't the answer people need to read up.
@@DaveP-uv1ml Doesn't matter what they raise it to people will still get scammed if they don't follow the rules set to protect them.
@@DaveP-uv1ml Operate a business in California is much harder than other states. California is already have a great shortage of contractors and builders, otherwise why would many people chose the prepay for ADU with this questionable builder in the first place. The truth is: more you regulate, the more likely price will increase or contractors have to cut corners and become fraud. Have any builder under current California laws chose to build true affordable single house?
Paulhus, that's a special last will not be forgotten.
Great reporting by NBC Bay Area..shared via threads
Why can the owner’s not file against the general liability insurance? The limits are often much higher $1,000,000 +
You're assuming they had general liability insurance.
@@660Oliver California requires contractors of 4 or more employees to carry $1,000,000 general liability insurance to obtain a license.
@@rodneyjohnston4381 It appears that this outfit subcontracted all the work out. I'm betting the only employee was himself.
@@660Oliver still, the subs are required to carry the insurance and list the builder on their policy. Would not be easy, probably a class action.
“0n one level we feel RELIEVED that we weren’t the only ones scammed”. Really?
I'm sure this is how the people of Rwanda felt. Sucks to be genocided, but at least you weren't alone!
Sorry, just a ridiculous frame of mind
A bond that low is ridiculous! I feel so bad for these people
Increase bond, increase building cost.
Building 101 is "never pay the contractor in advance".
This has always been the case, it is Buyer Beware when it comes to builders, you never give them access to your bank accounts, you pay in draws after the work is completed and inspected, you never give large up front deposits, the reasons for this are hard learned lessons. Builders can grab the money, and run, or just go bankrupt leaving you with nothing. One can not over look that these home owners had a responsibility to protect themselves, and they did so very badly, there were alarm bells all over this builders actions, they just were not paying attention.
Thousands of transactions are done by contractors with no problems. the business owner violated state law. He will go to jail.
Sorry but these homeowners are part to blame. You don't have to be a rocket scientist to figure out how to address work progress payments. It's pretty simple.
Yes, You never ever hand over all the money at the front. I normally do three splits. If it's a project that has a lot of material costs then maybe 50% up front to buy the stuff but that other half comes when things are complete
@@JimDean002In CA, you are only allowed to ask 10% or $1000 up front, whichever is less (excluding special order material).
All the "ADU experts" were backing this company and anytime someone would share some criticism they'd be labeled a hater. These homeowners should file a case against the people that recommended this company and this owner should be in prison for fraud.
We bought in 2021, we got an extremely poorly built tiny house. Sued but nothing happened. Lawsuit is still active but Colton and his lawyer refuse to show. Seize all assets, homes, cars, boats, dogs and anything else he and his father have and split up between those scammed. Why is it people like this are allowed to just walk away.Lock him and his father up.
There’s a difference between a license bond and a performance bond. The best protection, considering the disconnect with the state, is to require a performance bond before signing a contract. That’s a bond that assures the completion of a contracted project. However most small contractors would probably bulk at the demand. Contract law is something of a hodgepodge with sometimes strict and sometimes lax enforcement. There are several violations of contract law in these cases. Asking for an excessive down payment is one of them. I believe the law limits a down payment to 10% of the total and limits progress payments to amount equal to the progress demonstrated. There are several legal avenues the state could follow if they would.
A true misunderstanding of information. The contractors license bond is for the State of California to have enough money to sue the contractor to put him out of business for violation the contractors license law. That’s all it’s there for. It’s not for the customer. If you want a bond to assure the completion of your project you have to ask and pay the contractor for that surety.
totally! I’m currently in court with one of the bond companies for a contractor. Unfinished projects are not protected!!! A total scam!
and the 1st judge who sit on my case supported the contractor’s bond and assumed it’s fine to not pass city inspection and the contractor doesn’t have to pass city inspection. My project is basically half way through. The judge says she is not into contractor’s not passing city inspection..
Just lost the court case where I experienced illegal subcontracting, refused to pass inspection and refused to provide invoice. Jusge ruled a “plaintiff to take nothing” order and it’s a case where contractor went to my property and trespassed to cut off my hvac system to extort payment. It’s impossible to fight against the surety bond since they are the professional scammers.
Make the contractor post a performance bond or get course of completion insurance before works begins. Also retain 50% of the contract value of the scope of work to guarantee work is completed otherwise you lose control. Finally pay in increments as stages of work are completed. For added protection, don't hire a contractor who is doing business as a corporation, since their personal assets cant be taken in a lawsuit...dont forget the initial down payment per california law is 10% or $1,000 whichever is less
Bond amount should a sizable set percentage of the total of all quarterly invoices. If that can’t be implemented then bonding amount and percentage of coverage per customer should be front and center of all transactions.
Has a small business owner, I agree but at the same time it adds to another cost if the Bond is raise then the cost is pass on to me, between the bond, insurance, workers comp then taxes it strained me and other small business. Sometimes I feel like giving up and working a 8 to 5.
What a surprise. Never prepay before receiving goods or services. If it’s not reasonable it’s most likely a scam.
People complaining about why the government needs to implement laws to protect the general public. Well this is a prime example of companies screwing people over
Forget the bond, Contractor Law says the Contractor cannot take any more than 10% of contract amount or $1,000 , whichever is less.
Their contract is supposed to explain this as well.
The Contractor should be in big Civil trouble for this and the State should be all over them. This should be treated as a felony.
The homeowner should know better than to give so much up front as well.
Welcome to America. This is your country. Congrats!
Not just ADU, any contractor can leave customers high & dry. The state is not at fault, other than to do a better job informing the public of the coverage & payout of a bond. To provide ways to easily see the bond amount.
Because we need housing and cost to work and build here is high, not sure much else will really be done.
Sadly this means, it might be better to ignore a new biz and go with a biz with a long track record of finished projects.
Yes prosecute and claw back assets. Do not approve Bankruptcy for this guy and his company.
The bond isn't really for that, even if the law technically allows for collecting on bankruptcy. The bond is Iike a pre insurance claim, for mishaps, accidents that caused damage to property or faulty work.
It's not for a business lying and not finishing the work. For that you'd have to file a civil suit.
@2:26 “i dont understand.” 😂😂😂
An informed buyer follows the industry standard, and demands that the bidding contractors include the cost of an individual project performance bond, which bond meets or exceeds the total cost of the project.
The government is not your babysitter .
As a CA licensed contractor since 1976, I’ve seen a lot. In these Tiny Homes cases, it looks like the CSLB requirement that a contractor is to not receive more from a client than they’ve delivered in services has been violated hugely. If the CSLB is desirous of mitigating these situations, they should require “completion bonds” for projects that exceed a certain amount, so those who do smaller projects aren’t asked to have huge licensing bond requirements put on them. Completion bonds aren’t a “perfect solution” to the problem, but would make far less harmful situations than this one.
Bobby McGee for Bobby McGee Construction
You sound like the kind of person who should attend the contractor board meeting in October
Payment should not get ahead of work performed. Property owner needs to verify that the products have been paid for.
Look into ITH, Incredible Tiny Homes in Tennessee. They make fully contained homes, and can transport them to your location.
I believe they're built to code but ask about CA codes, and may even be insurable. Theyre a lot smaller than what was shown on screen though. Since theyre built on trailers with wheels.
Need water and electric hookups
NEVER NEVER NEVER buy an off-the-plan property.
No, not regulation. If you work for a living you must protect yourself. Don’t risk it without requiring a bond. Don’t trust anyone with your money.